October 25 (SeeNews) - Increasing inflation, supply chains disruptions and financial markets disturbances caused by the continuing geopolitical tensions are expected to slow Albania's economic growth over the medium term, the World Bank said.
Albania's gross domestic product (GDP) is projected to expand by 3.2% in 2022, the World Bank said in a statement on Monday after releasing its latest Western Balkans Regular Economic Report.
“These prospects hinge on the global recovery and Albania’s structural reforms, as well as keeping the course on fiscal consolidation,” Emanuel Salinas, World Bank country manager for Albania, said in the statement.
Higher costs of public service provision can further affect growth as higher spending may be needed to guarantee the energy supply through imports, the global lender said.
Tighter global financing conditions, a slowdown in both domestic and external demand, and weakening business and consumer confidence is expected to impact the financial sector of all Western Balkan economies. The region should prioritise policy support to the vulnerable and reforms that boost medium-term growth at limited fiscal cost, the World Bank noted.
Albania's economy grew by an estimated 8.5% in 2021.