Gent Sejko: Welcome remarks -14th SEE Economic Research Workshop Welcome remarks by Mr Gent Sejko, Governor of the Bank of Albania, at the 14th SEE Economic Research Workshop, virtual, 10 December 2020. * * * Dear professors and researchers from academia, Dear fellow central bank colleagues/researchers, Dear participants, It is a great pleasure to open the proceedings of the 14th SEE research Workshop. Due to the difficulties and restrictions imposed on all of us by the COVID 19 pandemic this year’s workshop is organized virtually. I am glad to see that you are all well, and wish that you and your families stay safe and healthy during these difficult times. In a way it is sad that we cannot welcome you all in Tirana during these December days. However, at the same time I am very glad that despite the forced change in the format and in the presence of the many inconveniences caused upon all of us by the pandemic and related restrictions, we are having a full house with participants from the academia in Europe and central banks. We thank you for your interest and take this as a certification of the quality and reputation of this activity. Our research staff is eager to get to know your work and discuss with you the research that has been produced by bank of Albania during 2020.
This shock and the negative effects that it brought upon the economy and the central bank policies have been beyond comprehension. The authorities are feeling the difficulty of performing their task in the zero lower bound or very close to it. In this respect central banks have lost the traditional instruments of monetary policy and are reverting to money as the instrument of monetary policy. The shift has been significant not only in size but also in concept. The leading central banks in developed economies, the ones which set the trends, are under process of reviewing their objectives and monetary policy. Using support of research analysis and conclusions they are eventually rewriting monetary economics by giving central banks new instrument in the form of permanent use of the central bank balance sheet as a tool of monetary expansion. However, while implementation of balance-sheet strategies is easy to implement and deal with for developed countries central banks, same policies might not be easily adaptable and applicable by developing economies. Narrow and shallow capital markets, problems of financial inclusion and financial education, stressed private, public and fiscal balance-sheets and history, remind us of several potential risks that such policies can have for the highly dollarized/euroized economies of South-East Europe. Yet in the presence of current constrains faced by monetary policy we have to react and to find new ways to support the economy.