TIRANA, April 11 /ATA/ – The European Bank for Reconstruction and Development (EBRD) presented the findings of Transition Report 2017-18 in Tirana on Wednesday.
Addressing the event, the Governor of the Bank of Albania, Gent Sejko, said that the EBRD report presents a positive assessment of the developments in the region.
“After some years of anaemic growth, the economic activity in the region shows recovery and the prospects remain positive, notwithstanding the geopolitical concerns and the internal and external challenges we face,” central bank governor said in his remarks.
EBRD says in its report that the Trans-Adriatic Pipeline project (TAP) will facilitate and make positive impact on the development of Albania’s energy infrastructure.
“We asses that TAP investment will provide positive effects on energy infrastructure and will contribute to productivity growth through lower costs and coverage of capacity-building needs, overcoming one of the structural weaknesses of the Albanian economy (reliable energy supply),”the report notes.
According to governor Sejko, inflation is gradually returning to target levels and the accelerated economic growth in the Western Balkans is supported by bank lending and some major infrastructure projects.
According to Sejko, the EBRD report notes that productivity growth slowed down; hence, the firm dynamics is identified as one of the main issues that should concern our region.
Sejko highlighted some of the main reasons affecting these developments.
“First, the low capacity of markets and firms to regenerate, decelerates the replacement of non-productive firms with new innovative ones, and hinders the efficient allocation of resources. Secondly, small businesses are failing in increasing their output or the number of employees,” sejko noted.
The Bank of Albania – Governor Sejko went on saying – deems that the development of the financial system is indispensable for the economic development of the country.
“In this regard, through our policies, we are trying to encourage a more efficient allocation of bank lending, in order for it to be less fragmented or concentrated in certain sectors of the economy,” he said.
Likewise, he noted that central bank is closely monitoring the financial and borrowing situation of micro-economic firms, including those operating in the country’s agricultural sector.
According to the central bank’s most recent surveys – he added – the primary concerns of smaller firms are: unfair competition; difficulties in finding markets to sell the products; and, to a lesser extent, limited access in financing or the cost of providing banking products and services.
Sejko put emphasis on the indispensability of continued efforts to press ahead with the implementation of structural reforms, which aim to increase the formalisation level of the economy, as a tool for raising competitiveness, for promoting consolidation, for improving the governance of firms, and for lowering their financing costs.
Sejko insisted on the need for reforms in order to promote development of firms in fields where the region and Albania provide competitive advantages, such as tourism or the agro-industry, and in those fields that have high value added, such as the information technology or the financial services.
Development capital markets, as a tool to support new and innovative firms and as a partner to share the financial risk of entrepreneurs in the stage of the expansion and development.
The report also highlights that the projects and investments in infrastructure have contributed to economic integration of Albania with regional countries, providing a positive effect on higher productivity and more opportunities.
/a.gjonaj/ /a.g/u.sh/
