Albania Sees Drastic Drop in Trade In Jan ’09
Economy, Top News Wednesday, March 4th, 2009Tirana | 03 March 2009 | Albania’s trade registered a large slump in January compared with the same month in 2008, data published by the National Institute of Statistics show.
Exports were 11.8 percent lower than in January 2008 and 4.5 percent lower than in December 2008. Imports saw even a bigger drop, at 10.5 percent less than in January 2008 and 41.5 percent lower than December 2008.
The reduction in trade activity is expected to hit tax revenues for the 2009 fiscal year. The centre-right government of Prime Minister Sali Berisha has planned to continue high expenditures in infrastructure, raise pensions and wages for state-employees.
The International Monetary Fund, IMF, warned Albania on Saturday it should be prudent in its spending ahead of its general election on June 28 or risk possible threats to its macroeconomic stability.
In its final report on Albania-IMF relations, the Fund warned that “without its program support—which has served as a policy anchor since the early 1990s—added prudence of policy makers is called for when, at the same time, upcoming elections may tilt political instincts in the opposite direction”.
Albania ended its final supervisory agreement with IMF on Jan. 31, despite warnings from experts advising that it be extended to avoid the risks of a populist spending spree in an election year.
“The end of the program falls in challenging times. The external environment is deteriorating sharply and previously high inflows into the banking system have slumped,” the IMF said.
“Remaining structural problems in the utility sector, and elevated public debt aggravate vulnerabilities, meanwhile, the upcoming elections risk diverting policy makers’ attention from stability-oriented policies”, the fund added.
(Reporting by Besar Likmeta) Source: Balkaninsight
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