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Albanian Economy 3,5% Growth in 2017

European Commission
14. February 2017

The European Commission affirmed the previous forecast for Albania's economic growth

The European Commission said on Monday it affirmed its previous forecast for Albania's 2017 economic growth at   3,5 %. 

Growth is expected to be driven mainly by household spending and private investment, the Commission said in it's Winter 2017 Economic Forecast. The Commission evaluated positively Albania's accommodative monetary policy stance, the improving labor market and the strong FDI inflows. The European Commission slightly raised its projections for Albania's 2018 GDP growth, to 3.6% from 3.5% in its November forecast.

For 2016, the Commission said it expects the country's gross domestic product (GDP) to have grown by 3.3%. Previously, it had projected an economic growth rate of 3.2%. The Commission also said that the Albanian central bank's decision to keep its policy interest rate unchanged at the record low level of 1.25% since May last year will continue to support the increase in domestic demand. Household spending is benefitting from favorable financial conditions, as well as from improvement in the labor market conditions. In the third quarter unemployment was 15.2%, record-low in more than three years. Meanwhile wages are rising.

The upward trend in investments, mainly related to ongoing energy projects, such as the Trans Adriatic Pipeline, is also projected to continue in the next two years.