Gent Sejko: Statement - press conference with IMF Mission Chief Statement by Mr Gent Sejko, Governor of the Bank of Albania, at the joint press conference with the International Monetary Fund (IMF) Mission Chief for Albania Minister of Finance and Economy, Tirana, 10 October 2022. *** Dear media representatives, In the last two weeks, the Bank of Albania and the Albanian government have been engaged in intensive discussions with the IMF Mission, which visited Albania in the framework of the regular Article IV consultations. Discussion focused on current challenges for the Albanian economy, as well as structural reforms that would enable a faster and more sustainable development of the country in the long term. Allow me - first and foremost - to extend my thanks to the IMF Mission for the open share of views in addition to the fruitful and transparent discussions. Overall, the Bank of Albania and the IMF share similar opinions on the developmental challenges that lie ahead. The swift upsurge of prices in the global markets following the unprovoked military aggression of Russia over Ukraine, have triggered serious economic and social challenges for the economies and citizens of all countries around the world, including Albania. Inflation hit 8% in August, increasing at a rapid pace and having a broad base. Based on our judgement, we have previously stressed out that the high inflation is the main threat on the macroeconomic stability and both the stable and long-term growth of Albania.
In the same vein, our projections suggest that the Albanian economy will continue to grow in the medium-term horizon. Although the economic activity will suffer from the negative consequences of inflation, the economic growth of Albania is expected to remain in the positive territory. Economic growth will continue to benefit from the overall financial and economic stability in Albania, the sound balance sheets of enterprises and households, as well as the continuing support of the banking sector with credit and payment instruments. In this context, it should be emphasized that the banking sector appears sound, liquid, and well-capitalised. The continuing reforms undertaken in the past years have borne their fruits. The consolidation of the banking sector, the improvement of the lending environment, the multifaceted development of financial markets and payment systems, as well as the initiatives carried out that encourage the use of national currency, have brought about notable qualitative improvements in the stability and efficiency of the banking sector. The growth rate of credit to the private sector recorded a progressive improvement, peaking to 13.7% in August. Also, it shows a good coverage of the need of enterprises and households for long-term financing and liquid tools. The stable growth of credit and the increase in the quality of its portfolio, are crucial indicators which demonstrate the sector's support to the economic recovery of Albania.