Increasing confidence in the
economy and favorable financial conditions have supported the growth of private
consumption and investment during 2016. And, according to forecasts of the
Ministry of Finance presented in Macroeconomic and Fiscal Framework 2017 -
2019, which was published recently in the Official Gazette, the economic growth
for 2016 is projected at 3.4%.
Also, Finmin said in this document that
the country's economic growth is expected to rise gradually in the medium term
period 2017 - 2019 at an average value of 4.1%. The government will allocate
private capital to finance a broad package of public works projects, mainly in
infrastructure and tourism.
This package makes it possible the
investment of Lek 700 million up to Lek 1 billion in the next 2-3 years. Its
goal is to restore rapid economic growth in Albania, same as in pre-crisis
Based on projections of key
macroeconomic indicators, fiscal measures taken, the expected effects of
administrative improvement and other factors determining the performance of
different items of income of the state budget, the total income for three
following years (2017-2019) is projected to grow by an average of about 7.2
In its latest report, the International
Monetary Fund ranked the Albanian economy 75th among 190 economies of the world
in terms of the economic growth. Fund predicts that GDP in Albania will expand
by 3.7 percent this year, leaving behind other countries in the region.
Currently experts say that the Albanian
economy continues to operate below its potential, which in turn is reflected in
inflation below the targeted objectives. During the first half of 2016 average
annual inflation rate according to official statistics of Ministry of Finance
Albania's economic growth showed signs
of recovery after the global economic crisis. As a result of the global crisis,
growth rates were significantly reduced. Real growth in
2009 was halved from its historic trend,
but continued to be positive as a result of limited exposure to international
financial markets and an expansionary fiscal policy, initiated before the
Economic activity in Albania is directly
impacted by the international economic environment, particularly in its trading
partners, such as Italy and Greece, mainly through exports to them,
remittances, and foreign direct investment (FDI).
Exports, remittances, and to some extent
foreign direct investment (FDI) fell by turning on the main channels of
transmission of external shocks on the economy.
The economic growth recorded its rate of
1.1 percent in 2013, due to the decline in consumption, investment freezing and
financial and fiscal weaknesses that emerged.
Thanks to an increase in domestic demand
supported by sound fiscal policies and structural reforms, growth is estimated
to have reached 2.0 percent in 2014 and 2.6 percent in 2015, due also to an
increase in consumption and private investment.