According to the Ministry, Moody’s highlighted the resilience of the Albanian economy and forecasts real GDP growth of 3.6% in 2025 and 3.5% in 2026.

Economic growth is expected to be supported mainly by the continued performance of the tourism sector, steady inflows of foreign direct investment-particularly in energy and tourism-and higher labour market participation.

On the fiscal side, the rating agency noted that budget execution remained prudent in 2025. Moody’s estimates the fiscal deficit at 1.8% of GDP in 2025, up from 0.7% in 2024 but still below the government’s target of 2.4%.

The agency also expects Albania’s public debt-to-GDP ratio to decline slightly to around 51% by 2027, from an estimated 52.6% in 2025, supported by solid economic growth and a balanced or slightly positive primary fiscal balance. Public debt is projected to continue declining gradually over the next three to five years, reflecting adherence to a prudent fiscal framework.

According to the Ministry, the “stable” outlook reflects Moody’s assessment that upside and downside risks to Albania’s Ba3 rating are broadly balanced. The agency expects reforms linked to European Union accession to continue, albeit at a gradual pace, while liquidity risks for the government and banking sector remain manageable.

The reaffirmation of the rating signals macroeconomic stability and continued progress in structural reforms, providing a positive signal to international investors and supporting Albania’s long-term European integration goals.

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The meeting focused on the country’s economic and financial health and ways to foster cooperation between the two institutions.

Central Bank governor said that Albanian economy has performed positively despite the many and serious challenges over recent years. He underlined that Albania has registered solid growth, low inflation rate, whereas the country’s domestic and external balances have improved.

Sejko said that the latest updated projections suggest that economy will maintain its positive growth momentum in the future, with economy expected to expand at a stable rate and inflation projected to remain at the current rate and to return to the Bank’s target in the first half of the next year.

Governor Sejko also noted that the central bank’s accommodative monetary policy helped efforts to keep inflation under control, without threatening the country’s upward growth trend and its financial stability.

Moody’s officials praised Albania fort its progress and growth over recent years, highlighting the country’s economic and financial stability. They also noted that Albania’s further European integration and accession to the Single European Payments Area (SEPA) will deliver significant benefits, but also a series of challenges in improving policy-making, drafting and implementation of the supervisory and regulatory framework.

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The Agency sad that the country’s macroeconomic stability was maintained in the wake of three major blows to the Albanian economy in recent years, the 2019 earthquake, the COVID-19 pandemic that sent national economy into recession in 2020, and the European energy crisis in 2022 triggered by the war in Ukraine.

Moody’s said that the Albanian economy showed resilience to the shocks it faced, recovering strongly to 8.9% in 2021 and 4.9% in 2022, after contracting 3.3% in 2020, with the tourism sector being one of the worst-hit sectors by the pandemic.

Albania’s tourism sector surpassed its pre-pandemic level in 2022 and will reach a new record high in 2023.

Albania’s fiscal indicators have shown an upward trend after significantly deteriorating in 2013. However, the three major shocks faced by the Albanian economy in recent years have affected public finances.

According to Moody’s, Albania’s total public debt to GDP ratio increased by almost 9 percentage points during 2019-21, recording a high of 74.5% in 2021. In 2022 the public debt ratio regained a strong downward trend, falling by almost 10 percentage points, well below the pre-pandemic level in 2019.

Taking notice of the GDP expansion and the narrowing fiscal balance, the Agency projects a decline in the public debt ratio to 62.3% of GDP in 2024 (12.2 percentage points below the 2021 level of 74.5%) and 3.5 percentage points below the pre-pandemic level of 2019.

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