TIRANA – “The latest global coronavirus outbreak (COVID-19) is expected to slow economic growth further in 2020 in Albania, and this shock will also hit tourism. The rate of slowdown is very unclear at the moment,” has said IMF.
This gloomy prediction was made by the International Monetary Fund (IMF) mission led by Jan Kees Martijn after consulting with Albanian authorities lately, according to a statement issued by the IMF.
IMF experts underscored that following the earthquake of November 26, 2019, the spread of coronavirus is expected to further slow Albania’s economic growth this year.
“Policies will also be needed to protect people during the COVID-19 outbreak by ensuring that the health sector has sufficient resources and supporting the most affected. Monetary policy should be significantly accommodating to support economic growth, “the statement said, adding that the IMF remains “ready to continue dialogue with authorities on measures to help limit the economic impact of the virus.”
The shock from the pandemic, which has affected the world economy and the country’s main economic and trade partners, is second to Albania after the powerful November earthquake.
“The short-term outlook for the Albanian economy has changed significantly over the past three and a half months. The earthquake that hit Albania on November 26 is expected to weaken growth in 2020, as the negative impact on economic activity (in particular, tourism) outweighs the positive impact of expected reconstruction efforts After the earthquake,” the statement pointed out. IMF mission praised Albanian authorities who, as they said as quoted by VoA, have rightly decided to prioritize budget spending in support of reconstruction assistance and efforts, allowing for a moderate increase in the fiscal deficit.
“It is important to ensure that reconstruction projects are administered in a transparent manner in line with international best practice and prioritize the most at risk,” IMF experts said.
The Fund’s mission noted that “after 2020, after the current negative shocks have passed, authorities should build stronger fiscal drivers that will allow greater fiscal stimulus to address possible future shocks. Therefore, measures to reduce public debt and improve fiscal risks proposed in our Concluding Statement of November 26, 2019 remain critical,” the statement added.
IMF experts also commented on government’s recently mentioned initiative for a broad fiscal amnesty, pointing out that “it will have to be implemented very carefully. While no specific proposal has been made so far, experience in other countries has shown that such programs undermine compliance with fiscal obligations. Moreover, effective systems must first be established to detect evasion and prevent money laundering and corruption,” concludes the statement issued by the IMF mission./Argumentum.al/
