At the end of his first visit to Albania, the Deputy Director of the International Monetary Fund Bo Li asked the leaders of economic institutions to protect the poor from the crisis of price increases through temporary fiscal support.
Albania is currently dealing with inflation of at least 8% while many items, including food and fuel have gone way beyond that. This is a big blow to one of Europe’s poorest and most debt-ridden economies.
“In my discussions with the authorities, I emphasized the challenges faced by Albania resulting from the increase in food and energy prices, the tightening of financial conditions and the weakening of the external environment. There is a need to protect the vulnerable from rising living costs through temporary and well-targeted fiscal support,” he said.
He also stated that an important point of his meetings with Governor of the Bank of Albania Genc Sejko and Economy Minister Delina Ibrahimaj was the promotion of Albania’s growth potential and the convergence of income with the EU
“We also discussed policies to promote Albania’s growth potential and revenue convergence with the EU, and I asked the authorities to continue with the finalization and implementation of a sound Medium-Term Revenue Strategy, he said.
The deputy director of the IMF did, however, note the considerable stability of Albania in the face of numerous challenges in recent years, which according to him, comes from the quick reaction of the authorities.
“Albania has shown considerable resilience in the face of numerous challenges in recent years, maintaining macroeconomic and financial stability. The authorities have responded quickly to strikes with policy barriers built in the past.”
Meanwhile Deputy Finance Minister Besart Kadia told the media that the government is trying to play catch up when indexing welfare payments against inflation. He said the winter will be difficult and it is exepected not to be resolved in a few months, but rather a much longer time.
“This is not a period that will be resolved in a month or two. We, as the Minister of Finance, have been strict that this is not a temporary crisis that will be resolved in 2 months, it is lasting and the concern is that it will not be an easy winter. The increase in gas and energy will also be reflected in the prices in Albania,” he said.