“1b euro” project main driving force behind Albania’s 4% GDP growth in next two years: VIIES

The Vienna Institute for Economic Studies has significantly cut projections for the performance of the Albanian economy this year by 0.3 percent.

Among other things, the institution, in its latest report on the region, also gives an estimation of the performance of the country’s economy this year, and it also offers the reasons why the economic performance has been revised for the next two years.

The emphasis is placed on the appreciation of local currency, Lek.

The report says that tourist season, banking sector restructuring and the flow of foreign direct investment are all three inadequate factors to justify the fall of the euro and strengthening of Lek.

Despite an intervention from the Bank of Albania, the seasonal effect, ie tourism, will have an effect, conveying fluctuations to the exchange rate, the report states further on.

Regarding the general framework, the Vienna Institute positively assesses the pace of reforms.

The labor market is also considered in a very good shape in terms of performance.

The report says that the depreciation by 0.3 percentage points comes as a result of a number of risks that have been added to the Albanian economy.

Meanwhile, the upward revision of the economy for the next two years has come as result of infrastructure projects, part of the 1 billion euro program.

SCAN

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