September 27 (SeeNews) - The World Bank said on Tuesday Albania's real economic growth will be 3.2% in 2016.
The projection is unchanged compared to the GDP growth outlook for Albania in the bank's Global Economic Prospects report published in June.
Investments, mainly in the energy sector, will be the primary source of the projected growth, the World Bank said in its South East Europe Regular Economic Report on Tuesday. The report covers six countries of the region (SEE6) - Albania, Bosnia, Kosovo, Macedonia, Montenegro, and Serbia.
In Albania, a country where large public projects are part of the expansion, growth is projected to slow down as project activities level off, the bank said.
In 2015, Albania posted economic growth of 2.8%
The current account gap is expected to widen to 13.1% of GDP in 2016 due to projected higher trade deficit and falling remittances
Fiscal consolidation started to bear fruit, helping reduce Albania's fiscal deficit from 4.8% of GDP in 2015 to a projected 2.5% in 2016.
The World Bank warns that poor planning and management of investments in Albania could lead to the accumulation of new arrears.
The bank projects consumer prices in Albania to grow slowly in the medium term. According to the latest data from the country's statistics office, INSTAT, Albania's consumer price inflation accelerated to 2% year-on-year in August from 1.9% in July.
Details from the World Bank report follow:
|
2015 |
2016 |
2017 |
2018 |
Real GDP growth |
2.8 |
3.2 |
3.5 |
3.5 |
Consumer price inflation |
1.9 |
0.9 |
1.5 |
2.9 |
Public revenues (%/GDP) |
26.5 |
27.1 |
27.1 |
27.1 |
Public expenditures (%/GDP) |
31.3 |
29.6 |
29.3 |
28.2 |
Fiscal balance (%/GDP) |
-4.8 |
-2.5 |
-2.2 |
-1.1 |
Trade balance (%/GDP) |
-18.1 |
-20.8 |
-21.6 |
-21.8 |
Remittance inflows (%/GDP) |
6.9 |
6.7 |
6.4 |
6.1 |
C/a balance (%/GDP) |
-11.7 |
-13.1 |
-13.0 |
12.0 |
FDI inflows (%/GDP) |
7.4 |
7.1 |
7.1 |
6.5 |
External debt (%/GDP) |
74.2 |
74.6 |
74.9 |
75.1 |
Unemployment rate (%) |
17.1 |
16.8 |
n.a. |
n.a. |
sources: Albanian authorities, World Bank estimates and projections
The other economies in the SEE6 region are expected to maintain growth of between 2.8% and 3.6% in 2016, the World Bank said.