Albania targets 2.6%/GDP gap in 2023 budget draft - c-bank

The draft budget envisages revenues of 632 billion leks ($5.4 billion/5.4 billion euro), while expenditures are expected to stand at 687 billion leks, Sejko said in a statement on Friday.

Albania's government targets a budget deficit equivalent to 3.3% of GDP in 2022 under its revised annual budget.

The public debt-to-GDP ratio is expected to fall to 65.7% in 2023, from 68.8% of GDP expected in 2022.

The 2023 draft budget focuses on fiscal consolidation, which together with the normalisation of the monetary policy stance should enable inflation to return to target within the first half of 2024, Sejko said.

The increasing inflationary pressures is seen as the main risk to the country's long-term growth, the central bank governor added.

"This type of inflation reduces long-term investments, disproportionally hits the lowest income earners, increases uncertainty among households and enterprises, and damages social cohesion," Sejko said.

In the 2023 draft budget, Albania's government plans a new Eurobond in the minimum amount of 500 million euro ($497.9 million), news provider Albanian Daily News quoted finance minister Delina Ibrahimaj as saying last week. The government will make the borrowing only if market conditions are appropriate, Ibrahimaj said.

Albania's government approved the 2023 draft budget in October, according to local media.

(1 euro = 116.983 leks)