TIRANA, May 26 – The sale of a huge amount of fuel by state-owned Albpetrol oil company and the award of three 4G licences secured the Albanian government around Euro 52 million in the first five months of this year when public revenues have been underperforming due to sluggish consumption and private investments, the two key drivers of Albania’s growth.
State-run Albpetrol oil company which has been scheduled for privatization, has announced the successful sale of 100,000 tonnes of crude oil to an Albanian operator for around $31 million (€28.7 mln) this month at 72 percent of crude oil Brent price of around $66 a barrel.
The huge amount was purchased by “TPD-Trading Petrol & Drilling” an Albanian operator part of the Sulaj Progres Group which also operates in real estate development and entertainment industry.
In its 2015-2017 national economic reform programme approved last January, government says it plans to restructure Albpetrol oil company, the biggest remaining state run company whose privatization in 2012 registered a spectacular failure after a fake Euro 850 million bid by an Albanian-led consortium.
Government says it has set up a working group with technical assistance from the IFC, the World Bank’s private sector lending arm, to study Albpetrol’s restructuring and identify its proper form of sale or a public-private partnership in a bid to increase production, employment and investment in the oil sector.
Prime Minister Edi Rama has described Albpetrol as an atavistic and hybrid enterprise under state management during the past two decades of Albania’s transition to a market economy.
Earlier this year, the Albanian government also obtained around 22 million euros from the sale fourth generation of mobile service known as 4G LTE.
Underperforming public finances in the first four months of this year have forced government to curb spending in order to keep the budget deficit in check.
Finance Ministry data show government revenue rose by 4.6 percent to around 121.5 billion lek (€850 mln) in the first four months of this year but yet failed to meet the target by 4.3 billion lek (€30 mln).
The lower than expected revenue was caused by a drop in the value added tax and a slowdown in excise taxes affected by lower imports of fuel and tobacco which both underwent tax hike last January.
The value added tax, which is levied at a fixed 20 percent rate on almost every product and service and accounts for around one-third of total government revenue dropped by a considerable 9 percent in the first four months of this year, hinting sluggish domestic consumption which is the key driver of Albania’s growth.
