Ardian Fullani: Albania’s economic and financial developments in 2011 Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the presentation of the Bank of Albania’s Annual Report 2011 to the Parliamentary Committee on Economy and Finance, Tirana, 30 April 2012. *  *  *  Honourable Chair, Distinguished Members of the Committee, Ladies and Gentlemen, *** Before starting my speech, I would appreciate your kind understanding about the fact that the period after the submission of the Report has enriched the 2011’s economic data inventory with new information. It is understandable why this information is not incorporated into the submitted material. In the following, I will address overall economic developments based on the latest information, trying to also identify the differences between the latest data and the version available to you. *** Our annual meeting on introducing Bank of Albania’s Annual Report remains a special pleasure for me. More than a legal obligation, the Bank of Albania considers this Report as an important step to enhance institutional transparency, foster accountability and intensify the dialogue with all economic policy-makers and stakeholders. Let me now start with an overview of main conclusions of the Report. The economic activity recorded positive growth rates, while the macroeconomic balances remained stable or were further strengthened. It should be emphasized that this activity was conducted against the backdrop of deteriorating global economic and financial situation in 2011.
The estimates incorporated the price increases associated with Russia's invasion of Ukraine, with the knowledge we then had of how the conflict would unfold and its implications. While at the time inflation already appeared to be a global problem, it has since worsened, due to a protracted war, the spread of problems in international supply chains and transportation costs, and the effects of China's weak real estate sector and its zero Covid policy. On top of all this, there was further persistence in a context of significant inflationary surprises and heightened inflation expectations. Thus, we come to the end of the year with a sum of new shocks that were installed in our economy, which already exhibited important imbalances that needed to be corrected. During this period, financial markets have shown high volatility. At home, we have had to face it while immersed in a context of high uncertainty, which peaked in July. In that period, the local exchange market experienced important tensions in its price formation process, particularly in exchange rate derivatives. This led us to announce a foreign exchange intervention aimed at reducing the probability of significant distortions in the operation of other segments of the financial market. This year has not been easy, nor were the previous ones. In this challenging period, the Bank has continued to make progress in various areas.