The government's 560 million euro surplus/ How the Albanian economy is at risk

2026-06-18 12:58:00, Ekonomi CNA

The government's 560 million euro surplus/ How the Albanian economy is at

While budget revenues are being collected at enviable rates from year to year, on the other hand, the degree of effectiveness of tax use is increasingly deteriorating.

In addition to the high level of abuse of public funds in substandard projects, unrelated to economic benefits, and even more serious in projects such as incinerators that continue to be financed without laying a single brick, the government accumulates a budget surplus much higher than the program year after year.

The latest official data from the Ministry of Finance shows that in the first five months of 2026 there was an extraordinary increase in the budget surplus, significantly exceeding both government forecasts and the performance of the same period last year.

The surplus value reached 53.7 billion lek (560 million euros) for the first five months of 2026. This realization is almost twice as high as the government's initial plan of 26.8 billion lek in this period and marks a strong increase of about 37.6% compared to the fact of 2025, where this indicator was 39 billion lek.

Although at first glance a surplus can be interpreted as positive news for fiscal consolidation and macroeconomic stability, this performance in the case of our country is penalizing economic growth.

In the context of a developing economy like ours, which has urgent needs for infrastructure and social support, this large surplus over the plan reveals a chronic problem related to the non-realization of budget items.

At a time when the government is collecting taxes at high rates and is failing to put this money back into the market through public investments or higher pensions, it is freezing liquidity at a time when the country has great unmet needs, especially in healthcare.

This accumulation of money in the government's accounts with the Bank of Albania is helping to further strengthen the local currency in the foreign exchange market. By reducing the amount of lek in circulation, additional pressure is being created for the further strengthening of the national currency, while on the other hand euros coming from abroad are also increasing due to the tourist season.

This surplus, which is coming as a forced saving, carries with it the risk of all funds being exhausted in December. Experience has shown that the concentration of billions of lek in a short time leads to poor quality of public works due to haste in tenders and contracts./Monitor