Albanian economy among the fastest growing economies in the region

Albanian economy among the fastest growing economies in the region
The Albanian economy may have its problems, but its economy is growing faster than many other countries of the region. This is confirmed by the Bank of Albania, according to which, from one year to another, the Albanian economy has registered a higher rate of economic growth, while this growth is only overcome by Kosovo’s economy. The country’s central banking authority confirms that economic growth for our country this year was 4.1%, while Kosovo’s economy grew by 4.6%. “Economic activity in Kosovo marked a rapid growth in the second quarter, driven by investments and net exports”, bank experts explain, adding that “the economies of the region registered a growth in the second quarter of the year”, but, according to them, Macedonia makes an exception, as its economy shrank by -1.3%. “Macedonia’s economy shrank in the second quarter amid political uncertainties, which deterred investments. Investments dropped fast, especially in the construction sector and industrial production.

The negative effect has also been felt on the performance of exports. Meanwhile, consumer spending and government spending have grown, making small positive contributions on economic growth”, the Bank of Albania reports on the economy of the neighboring country. Meanwhile, experts also mention Serbia’s economy. According to them, Serbia’s economy is growing very slow, namely 1.3%. On the other hand, experts also mention another country whose economy is performing very well. This country is Turkey with 5.1% economic growth. “Turkey’s economy grew fast in the second quarter of this year too. This growth was mainly driven by investments, which have expanded rapidly, mainly as a result of developments in the construction sector. Exports have also improved, while consumer spending has slowed down economic growth”, experts say in relation to Turkey. In the end, experts of the Bank of Albania say that “in 2017, the economies of the region are expected to perform better than a year ago, thanks to aggregate demand and the positive performance in the Eurozone”.

Greece and Italy show a positive performance

“The economies of key countries that Albania does trade with, Italy and Greece, have registered positive growth in the second quarter of the year, in line with the positive momentum that the Eurozone is experiencing”. This is another confirmation that experts of the Bank of Albania have issued about the two countries with which our country has the highest volume of trade and the two countries which are the two biggest investors in Albania. In a way, this also explains our country’s economic growth this year. However, experts of the Bank of Albania add that “economic growth in Greece and Italy is below the average of the region”. “In Italy, consumer spending, government spending and investments have had a positive contribution on aggregate growth, while net exports have had an opposite impact. In Greece, investments have shrunk, but the growth of consumer spending, government spending and net exports have driven economic growth”, they explain about the economies of each of these countries. Meanwhile, they also say that inflation in these two countries which are key trade partners for Albania, has slowed down and in the third quarter, inflation was below the Eurozone’s average.

Eurozone, experts admit that economy has gained momentum

 “Economic growth in the Eurozone has gained momentum in the second quarter of this year, while its Gross Domestic Product grew by 0.6%”. This is the confirmation that experts of the Bank of Albania provide on the economy of the Eurozone, explaining that this zone is now going through a very good moment, following the economic crisis of the recent years. “The favorable financing conditions and the improvement of employment indicators are expected to boost consumption and revive investments”, they argue, adding that the strengthening of world economy and the improvement of foreign demand in the Eurozone are expected to sustain economic activity. “Inflation has registered a 1.5% growth in the months from August to September, as opposed to 1.3% in the months of June and July”, experts add.

COMPARISON

Overall, experts say that this year was a good moment for world economy. “The world economy has continued to expand in a sustainable way”, they say, explaining that “economic indicators for the months of July, August and September show a positive performance and sustain the strengthening of economic growth in the second half of the year”. Experts back this with the fact that production and economic growth during these months have registered values above the long-term average, signaling further growth in manufacture and services in the world. On the other hand, experts admit the threat from high prices. “Inflation has registered a growth in the months of July and August, mainly affected by a growth in the price of electricity”, they say.

 

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