TIRANA, Oct  24 /ATA/ The volume of constructions as part of the reconstruction process after the devastating earthquake that hit our country on November 26, 2019, but also due to soaring price of iron in the market amid the Russian aggression in Ukraine, caused the cost of imports of construction materials to increase during the 9- month period of this year.

The construction sector is one of the sectors with the most important contribution to the national economy. Data show that it contributes about 10% to GDP.

Referring to the data published by INSTAT on foreign trade, during the January-September period, the import of construction materials and metals recorded an annual increase of 4.8%.

In terms of value, the imports of construction materials and metals for this period are reckoned at over 103.8 billion ALL with a monthly increase of about 7 billion ALL, and almost 27 billion ALL higher than in the same period of 2021, when 77.4 bn ALL worth of building materials and metals were imported.

2021 recorded 111.8 billion Lek of construction material and metal imports, from 78.2 billion Lek that were in 2020.

The government says that the sharp increase in prices of construction materials has slowed down or caused some public contracts to cease operations, as further progress would cause significant unrecoverable losses for construction companies to the point of bankruptcy.

After the analysis on the implementation of the state budget for the 5-month period, it was noticed that the level of public investments through internal financing had slowed down, reaching 14% of the total amount planned for 2022, from 31% it was in the same period of 2021.

Based on this situation, the government drew up a Normative Act, laying down  the rules for compensation from 5-30% of the price of some construction materials that have increased.

Inflation and soaring interest rates are expected to hit purchasing power and demand in the property market. According to INSTAT, in the second quarter of this year the construction cost index recorded a record increase of 6.2%, driven especially by material and energy costs.

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