Pre-election tension, drought slowed Albanian economy: EU

The extended tense electoral climate has brought negative effects on the economy of Albania, slowing its pace of growth in the second quarter of this year.

The data this time come from the European Union in the report of the second quarter for the EU membership candidate countries.

“The data suggest a slowdown of economic growth in the second quarter, most likely reflecting the tense political situation ahead of the parliamentary elections, as well as problematic weather conditions,” the report states.

The decline for the second quarter also marked household consumption, which in year-on-year basis recorded a modest increase of only 1.9%.

Meanwhile, the Gross Domestic Product grew by 3.9% year-on-year in the first quarter, accelerating the pace of expansion from 3.4% in 2016.

A positive development was also reported in the employment rate, which rose by 2.8% in the first quarter of 2017, while in the previous quarter it grew by 5.5%.

According to the EU report, the unemployment rates among young people are still high, despite the decrease by 3.8 percentage points on an annual basis.

A persisting problem is the low level of lending, which, cleared by the effect of deleting the balance of non-performing loans, fell to negative levels in May, marking a rate of -1.2%.

However, the report considered Albania as the country that is expected to have the highest economic growth in the region for the years 2017 and 2018, respectively 3.7 and 3.9%.

When it comes to recommendations, the European Union stresses that Albania needs to continue its the path of fiscal consolidation, to continue efforts to increase public revenue, to continue the plan of reducing non-performing loans, as well as to promote the use of the national currency by citizens.

SCAN

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