ATA News

IMF increases the forecast for Albania’s economic growth to 3.6%

The International Monetary Fund (IMF) in the latest global outlook, published on Tuesday, has increased the forecast for Albania’s economic performance by 1.4 percentage points.

The IMF report published in October estimates that the Albanian economy is expected to expand by 3.6% in 2023.

Meanwhile, in the April report, economic growth for 2023 was estimated to be 2.2%, to accelerate to 3.3% in 2024 and to stand at around these levels until 2028.

For 2024, the IMF stands by the April estimates, for a growth of 3.3% that will improve slightly to 3.5% by 2028. The IMF made the revision in accordance with the new estimates, where for 2022 the growth resulted in 4.8%, from 3.7% which was the initial estimate.

Meanwhile, according to INSTAT, in the first and second quarters of this year, the Albanian economy grew by 2.83% and 3.23%, driven mainly by construction and real estate. Growth is expected to accelerate in the coming months, driven by the good performance of tourism.

Regarding the average inflation, the IMF projects it to be at the level of 3.8% this year, while in the April report, the average inflation was forecast at 3.9%.

Focusing on global developments, the IMF predicts that the global economy will continue to slowly recover from the shocks of the pandemic, Russia’s invasion of Ukraine and the cost of living crisis.

“Despite the problems in energy and food markets caused by the war, and the unprecedented tightening of global monetary policy as a means of combating high inflation, the global economy has slowed down, but not stalled. However, growth remains slow and uneven, with growing global divergences,” the IMF is quoted as saying.

According to the IMF’s latest forecasts, global growth will slow from 3.5 percent in 2022 to 3 percent this year and 2.9 percent next year, a drop of 0.1 percentage point for 2024 from the last July forecasts. This trend remains well below the historical average.