Albanian authorities have using their chance in a best possible way to boost growth in the country and to provide higher wealth and right income distribution for its people. IMF backed growth program which was firstly signed in the year 2002 is one of the main cornerstones to reach this target. But everybody should bear in mind that its a long marathon to run which requires much patience. Till today, Albanian authorities tried to:
Imply more liberal and transparent economic policies
Provide encouragements to increase export and to attract foreign capital
Give more independence to Bank of Albania (BoA) in implementing right macro economic policies
Privatise state owned companies to increase their productivity in the long run for the Albanian economy.
The sale of Saving Bank for US$ 126 million to Austrian Raiffeisen Bank (Highest price ever in a privatisation) is another big step to liberalize and deepen Albanian Financial Market. However, there is still a long way to run in the marathon. Governmental authorities should take more care about:
Improving tax collection, broadening tax base and strengthening administration
Strengthening the enforcement of the rule of law and the governance
Not being spoiled in future fiscal policies because of past good economic results
A deepened and more complex Albanian financial market is another cornerstone for Albania. In the world examples, financial markets have divided in to three main parts called foreign exchange (FX), money and capital markets. When we look into Albanian Financial Market, FX market is working without a problem between banks and foreign exchange offices. From time to times, what Albanian people call Black Market may work more effectively than the Albanian banks in FX because of cash based economy and widespread hoarding tendency of people. The money market where all the economic actors (Governments, banks, corporate customers, big companies etc.) can barrow and lend short term funds is existing but it is not deep enough for the Albanian economy. The capital market where all the economic actors can barrow and lend long term funds does not almost exist. A key element of capital markets, Albanian stock market where you can buy and sell stocks of Albanian companies to get their dividend payments, do not unfortunately exist.
A secondary government securities (Treasury Bonds, bills, etc.) market where all the economic actors, especially banks, can buy and sell government securities does not have liquidity. So a missing capital market is one of the hindrances in the marathon of Albanian economy.
Highly cash based economic activity of Albanian citizens is another hindrance in the marathon. This old habitual behavior of Albanian people to use cash and to hoard their savings in their houses as cash should be changed for Albanian shining future. |
