EU Growth Plan covers only 4% of public investment in 2026 budget

2025-11-10 07:25:47, Ekonomi CNA

In the 2026 budget, the Albanian government expects to benefit from around 6.8 billion lek in funding from the Growth Plan with the European Union, which will be distributed in various areas, based on concrete projects.

This amount will be used for specific projects related to structural reforms and economic development. The 6.8 billion lek fund is part of the funds that the European Union has made available to the Western Balkan countries through an overall package of 6 billion euros, from which Albania is expected to benefit from around 922 million euros by 2027.

Funds from the Growth Plan constitute less than 4% of the total public investment of 179.6 billion lek foreseen in the 2026 budget.

This modest weight indicates that, at the moment, the European funding included in the budget is still in the early stages of activation, while the majority of EU resources remain linked to the progress of reforms and the process of preparing projects that must comply with the requirements of the European Commission.

EU financial support will be distributed over several years and will be conditional on progress in implementing economic and institutional reforms, focusing mainly on increasing competitiveness, improving the business climate and aligning with the European single market.

If the reforms to which Albania has committed progress at the pace required by the European Commission, including improving public administration and implementing reforms in the energy sector, the country is expected to draw down most of the funds by the end of 2027.

Albania has so far benefited from very little funding from the growth plan, because the mechanism operates on the principle of “reform versus funding”, meaning that disbursements are made only after the country has implemented agreed reforms in areas such as competitiveness, public administration, energy and the rule of law. Albania is still in the implementation phase of these reforms and some of them have not been fully completed.

Also, the process of preparing and approving projects for financing requires time and strong administrative capacities.

Albanian institutions often have difficulties in preparing projects that meet EU standards, both for cost-benefit analysis and for ensuring transparency in procurement and technical implementation. These delays have meant that potential funds are not immediately included in annual budget planning.

The European Union's Growth Plan for the Western Balkans is a new economic and political initiative that aims to accelerate the approximation of the countries of the region to the European common market and EU standards.

It was presented by the European Commission at the end of 2023 and covers the period 2024–2027, combining financial support with a structural reform program that must be implemented by each beneficiary country.

The plan has a total value of 6 billion euros, which will be divided between six countries in the region - Albania, Serbia, North Macedonia, Montenegro, Bosnia and Herzegovina and Kosovo./ Monitor.al