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2027-2028, the government keeps the scenario for economic growth unchanged, unrealistic forecasts

2026-01-22 07:09:27, Ekonomi CNA

2027-2028, the government keeps the scenario for economic growth unchanged,

In the new macroeconomic framework, 2027-2029, the government kept the economic growth scenario unchanged, with expectations of 4% expansion this year, 3.9% in 2027 and 4.1% in 2028, according to the document published in the Official Gazette.

The Albanian government projects sustainable economic growth in 2027–2029, supported by consumption, investment and tourism, at a time when the three main pillars of the productive economy, exports, agriculture and industry, are in decline.

According to medium-term projections, growth is expected to be generated mainly by domestic demand, especially private consumption and investment, while net foreign demand (exports-imports) is projected to have only a moderate positive impact.

Consumption is expected to grow by an average of about 2.9% per year, while investments by 4.9%, driven by improved confidence and easier credit conditions.

Exports are projected to continue the “positive trend,” with an average growth of 4.6% per year in the period 2027–2029, supported mainly by tourism. But these forecasts stand in stark contrast to the real developments of recent years, where exports of goods have fallen, agricultural production has shrunk, and industry has lost weight in the economy, reflecting the weakening of the country’s productive and competitive base.

On the supply side, the government's own projections show an economy that is increasingly relying on services, and less and less on manufacturing. Agriculture is projected to grow by only 0.2% per year, with virtually no impact on GDP. Industry by 2.6%, with a minimal contribution to growth. Meanwhile, services and construction will bear the brunt of economic expansion.

Employment is also expected to grow only symbolically, by about 0.1% per year, while the expansion of the labor force will come mainly from increased participation and not from the creation of new jobs in the manufacturing sectors.

In this context, optimistic growth projections are not based on real developments in the economy, but on assumptions of higher consumption, stronger tourism and a better financial climate, while the country's manufacturing base is weakening./ Monitor.al