From: Exit News
World Bank Warns Reconstruction Efforts Risk Increasing Debt

Country Manager of the World Bank for Albania Maryam Salim said in an interview that caution must be taken in choosing reconstruction projects because if picking the wrong project could risk negative effects in economic growth and public debt.

Salim said that transparency in every step of the reconstruction process will increase trust. Regarding the monitoring of the funds, she advised data, such as the progress, the timeline, and all funding for every project, be made public online.

Salim warned that donors’ pledges that consist of loans will become part of the overall debt once the government elects specific reconstruction projects.

Salim clarified that the World Bank has pledged to grant Albania a €106 million loan, €85 million of which will be granted by the International Bank for Reconstruction and Development.

Currently, the government and the World Bank have agreed that €6 million from an ongoing project (to modernize healthcare) will be used instead to aid in the reconstruction of three hospitals.

To aid with further healthcare needs, the World Bank pledged an additional €15 million loan.

Reconstruction efforts will adhere to four main principles:

  1. Need-based priority, avoiding discrimination
  2. Reconstruction must be led by a building’s owner, through effective mechanisms that ensure integration of owners’ concerns.
  3. The reconstruction process must be transparent and fully accountable.
  4. Reconstruction must ensure that the newly constructed buildings will surpass the old ones in quality.

The World Bank also encouraged drafting a bill for the mandatory insurance for homes, keeping in mind other countries’ (Turkey, Romania) experiences where similar insurance programs were implemented with the World Bank’s technical and financial support. Salim said that it is now “up to the authorities to pass the law.”

Following the November 26, 2019 earthquake the government has approved 26 different development areas, but, until the end of February, it failed to make the status of each application public, whereas the website set up for that purpose did not provide any information regarding the procedures or their progress.