IMF supports BoA’s efforts to reduce euroization of Albanian economy

The International Monetary Fund, in its latest report on the Albanian economy, and which is the first in the post-monitoring program, supports Bank of Albania’s policy to de-euroize the domestic economy, thus reducing the dependence on the common European currency and promoting the use of Lek.

The International Monetary Fund states that this policy will further strengthen the monetary policy effectiveness of the Central Bank of Albania, and will limit the risks arising from lending in foreign currency.

Currently, explains the IMF, the high level of euroization of the economy, with loans and deposits in euros that account for more than 50%, undermines the effectiveness of monetary policy.

At the same time, deregulation would significantly reduce the risks to financial stability, the IMF states.

But, of course, the Washington-based institution adds, the de-euroization of the Albanian economy is a process that needs to be done gradually in order to avoid risks in an economy where informality remains a major issue.

SCAN

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