Albania

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The economy in 2022 showed remarkable resilience, despite risks stemming from external and domestic factors. Inflation picked up, but not too dramatically – 6.7% for the year. This was thanks to a government move to impose price controls on energy and food staples. Moreover, a steep rise in exports of goods and services, remittances and foreign direct investment led to appreciation of the currency, which served to contain inflationary pressures. November saw a fall in demand for credit, following a hike in the policy rate (up from 0.5% to 2.75% last year); demand will most likely weaken further, as monetary policy normalisation continues. The positive momentum seen in public finances – due to rising inflation and the concomitant higher revenues – will favour fiscal consolidation. Labour market conditions have been improving, and the unemployment rate dropped to a historic low of 11.1% at the end of 2022. Persistent emigration is helping to maintain the flow of remittances, though labour and skills shortages are looming. The weather has become a crucial factor in how well the country copes with the bottlenecks in the energy sector. Overall, in 2023 we expect growth to hover at around 3%, before recovering slightly to above 3.5% in 2024-2025.
        FORECAST*
Main Economic Indicators202020212022202320242025
Population, 1000 persons28382812....
GDP, real change in %-3.58.53.43.03.63.8
GDP per capita (EUR at PPP)919010480....
Gross industrial production, real change in %-6.326.6....
Unemployment rate - LFS, in %, average11.711.511.110.510.09.5
Average gross monthly wages, EUR434467....
Consumer prices, % p.a.1.62.06.74.03.02.8
Fiscal balance in % of GDP-6.7-4.5-0.50.00.50.5
Public debt in % of GDP74.573.2....
Current account in % of GDP-8.7-7.6-7.6-6.4-6.0-6.5
FDI inflow, EUR m9371032....
Gross external debt in % of GDP64.463.2....


Basic data are continuously updated.

* Forecasts are changed beginning of January, April, July and November.
See Press Conferences.

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Monthly Report No. 1/2023

Vasily Astrov, Alexandra Bykova, Rumen Dobrinsky, Selena Duraković, Richard Grieveson, Doris Hanzl-Weiss, Gabor Hunya, Branimir Jovanović, Niko Korpar, Sebastian Leitner, Isilda Mara, Olga Pindyuk, Sandor Richter, Bernd Christoph Ströhm, Maryna Tverdostup, Nina Vujanović, Zuzana Zavarská and Adam Żurawski
wiiw Monthly Report No. 1, January 2023
44 pages including 4 Tables and 16 Figures

Details

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Executive summary

Branimir Jovanović
in: Bracing for the Winter
wiiw Forecast Report No. Autumn 2022, October 2022 , pp. I-VIII
Details


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