New budget revision increases current account gap forecast to 14.6% of GDP

TIRANA, Sep 30؁lbania has raised the forecast for its 2009 current account deficit to 14.6% of the projected gross domestic product (GDP) in the latest revision of the country’s budget from 8.3% envisaged earlier, Finance Ministry figures indicated on Wednesday.
The country’s trade gap is now seen at 25% of GDP, higher than the 23.5% deficit projected previously.
Albania’s parliament approved late on Tuesday a budget revision proposed by the Finance Ministry earlier this month.
The revision raised budget spending to 34.08% of the projected GDP, or 400.9 billion Lek (2.98 billion euro), from 32.3%forecast earlier. The budget gap is set now at 74.79 billion Lek, or 6.36% of GDP, higher than the previously projected 4.2%.
Albania has also lowered its economic growth forecast for the current year to a real 5.8% from 6.3% projected earlier. Albania’s economy grew by a real 7.2% in 2008, even though the figures remain highly disputed, and by 6.0% in 2007.
The government has also lowered its 2009 average annual inflation forecast to 2.3% from 3.2% projected before the budget revision was made.
Albania’s government will take the steps needed to ensure continued fiscal consolidation, Finance Minister Ridvan Bode told a conference.
“For the rest of the year and next year, within the framework of preparations for the 2010 budget, the government will take the necessary measures to preserve the medium-term trend of fiscal consolidation,” he said.
The government and other public authorities will pursue economic and fiscal policies that support economic growth with a view to increasing productivity and competitiveness, Bode said.