Tirana to sell bonds

TIRANA, Feb. 4 – Prime Minister Sali Berisha made known, while on a visit to Brussels last week, that the government plans to sell its first foreign-currency bond this May, and said it is a sign that Albania’s economy has overcome the legacy of a half-century of communist-imposed isolation.
In an interview with Bloomberg Television, along other interviews to international news agencies in Brussels, Berisha said that Albania would raise as much as 200 million Euros with this bond, undeterred by the subprime crisis that has driven up interest rates for emerging-market borrowers.
However, the Albanian premier acknowledged that his government’s authorities had to still consult with the International Monetary Fund.
Berisha said his country was evolving from a country which was once considered the “North Korea of Europe” into a modern destination for western investors and travelers.
Further, Albania hopes to become a NATO member this spring as well as becoming a future member of the European Union.
Albania has had a stable 5-6 percent GDP growth in recent years while keeping inflation below three percent, a budget deficit reduced to 3.9 percent of GDP, and foreign investment equaling 5.2 percent of GDP, according to figures gathered by international institutions.
The economic output per person in Albania is 2,309 Euros, up from 204 dollars at the end of the communist regime, but still less than a fifth of the EU average.
Immigration remittances, increased exports and tourism remain main sources of income for Albania.
Also, officials believe Albania will soon resolve its power crisis.
Last June, Albania’s bond-sale plans were set in motion when it got a credit rating נa B1 from Moody’s Investors Service, four levels below investment grade, putting Albania on a par with the Ukraine, Pakistan and Jamaica. Balkan neighbors, such as Croatia and Bulgaria, have a Baa3 rating, which is the lowest investment grade.
Albania can only raise an additional 172 million Euros before it reaches the ceiling on international borrowing of 680 million Euros set by the IMF for the years 2006-2008, according to the latest IMF estimates.