Changes in the budget/Capital investments increase further to 1.5 billion euros, although the realization was quite weak in the 7-month

2024-09-02 07:24:00, Ekonomi CNA

Changes in the budget/Capital investments increase further to 1.5 billion euros,

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With the latest budget changes, the government increased the capital expenditure item to 150 billion ALL, from 135 billion ALL that was in the last changes with an increase of 11% from the first normative act and 210 million euros more than the initial budget.

Funds for capital investments reached all-time records, with an increase of around 150 million euros, which were divided mostly between the Ministry of Infrastructure and the Albanian Development Fund.

The roads and infrastructure program is the main beneficiary, as many public entities faced a decrease in funding such as agriculture and health which, even without the cuts, have a reduced budget in relation to their needs.

From January to July of this year, the budget allocated only 24% of the annual public investment plan.

According to official data from the Ministry of Finance, at the end of the 7th month, only 32 billion lek, or 24% of the annual fund planned for this item, was allocated to public investments, as the government further increased funding for this item.

Compared to the fact of the 7th month of 2023, capital investments have recorded an annual decrease of 11%. The data show that the government has failed to realize public investments, which is the strongest point of the realization of its program.

With the last review, the remaining investment funds are around 117 billion ALL or more than 1.16 billion euros, which will be allocated in the remaining months, negatively affecting some other economic indicators.

The Bank of Albania has stated more than once that the non-harmonized distribution of the investment fund during the financial year negatively affects the exchange rate.

The lack of budget funds in circulation has become the reason for the further strengthening of the Lek, while their concentration in the month of December is the reason for the increase in inflation.

Former treasury experts at the Ministry of Finance claimed that the concentration of funds at the end of the year increases the risk of their misuse.

The reasons for the non-realization of the public investment program are related to the stagnation of the procedures and the reluctance of procurement employees to sign, based on the fear of SPAK investigations.

Sources within the Public Procurement Agency claimed that there is a crisis for human resources in the procurement sector and a tremendous fear to sign the tender documents.

International financial institutions, on the other hand, have raised concerns that the management of the public investment framework faces weaknesses in all phases, from the classification of projects to their implementation.

In this year's budget changes, the Ministry of Finance has authorized public entities to carry out tenders, which will continue funding next year as well./ Monitor magazine