The American dollar was appreciated in the first part of the year, as a consequence of expectations for a tightening of the United States monetary policy. But, during the second part of the year, the attention of financial markets mainly focused on the structural problems of the American economy, that of the budget deficit and current account deficit. These concerns brought about a quick decrease in the American dollar value, reaching the minimum levels against the common European currency. In face of these developments, both monetary policy and fiscal policy of larger economies maintained expansionist features. Notwithstanding the rise of US dollar interest rates, they remained at low historical levels while Euro interest rates remained unchanged. The fiscal policy has impacted the growth of domestic demand, either in the euro area or in the United States. The progressive integration of the Albanian economy in the international markets of products and capitals makes that this economy benefits from these incentive policies, in the form of lower interest rates for foreign currency and in the form of higher demand for its exports. Placed in this positive background, the Albanian economy growth continues to be generated from the dynamic development of the private sector, while maintenance of the macroeconomic stability and economic growth support through investments in the priority development fields: infrastructure, education and health, have been a priority to the public sector. BIS Review 38/2005  1  During 2004, investments in the economy marked the same level as during 2003, representing nearly 25.4 percent of GDP.
The work for implementation of this project was inaugurated on November 2004, with the participation of senior managers of the World Bank. During 2004, the Bank of Albania, together with the banking system and the Ministry of Finance designed a number of operations, which were intended to reduce cash in economy. In view of meeting these commitments during 2004, a number of concrete steps were taken, among which I would highlight the following: completion on January 2004 of the interbank payment system, initiation of the big project for building the Automated Electronic Clearing House and the transfer of wages of public administration personnel through a bank account. Both above projects are regarded as an essential infrastructure, connecting almost the whole banking system. The implementation of the systems is done in accordance with best international standards and principles, based on modern and up date technology. On the other hand, I would emphasize that we have also organized meetings with various groups and representatives of economic interest, who not only have helped us to better understand our weak points, but have also served for clarifying mutual benefits to the participants. We are determined to continue our efforts in this direction even during 2005. Therefore, we are working to complete the project on small-size payments in time, to start cooperation with the World Bank for creating a credit information register.