Page 14 - Gazeta AFP

14
E enjte, 7 dhjetor 2017 14
Thursday, 7 December 2017
SHËNDETI
ENGLISH EDITION
300

Million euros, with a five
year maturity period, for
which Albanians paid around
22.5 million euros a year in
interest rate, was the first
Eurobond issued by Albania
in 2010

450

Million euros, with a five
year maturity period, was
the amount of the second
Eurobond issued by Albania
in 2015 in the capital
market, five years after
paying off the first debt

Eurobond, Albania is Outstanding

debts
planning to borrow again increase,

570 million

Eglantina Nasi lek owed by
banian Eurobond in foreign ros, arguing that the inter- bonds are said to include 115 of them were from Britain,
lbania will soon markets. est rate on this loan was investors in international 23 per cent of them were from institutions
borrow from for This time, the amount 5.75 per cent. Meanwhile, markets. Based on geo- the US and 46 per cent of
eign capital mar was higher, 450 million eu- the buyers of the Albanian graphical areas, 30 per cent them were from Europe.
A kets. Such fact is
confirmed by the Albanian fi-
nancial authorities. The Me- Currency rate shifts a threat for the
dium-Term Debt Manage-
ment Strategy 2018-2020
document says that "during payment of the debt
this period, we are project-
ing an increase of foreign
debts through the Eurobond". he Albanian state
According to experts, ppreciation of European currency, Euro, may pose a continues to pay
this method aims at balanc- real threat for the payment of the foreign debt by the Toutstanding debts
ing the lack of domestic fi- AAlbanian government in this currency. "The threat con- to the business sector.
nancing, guaranteeing that sists on the fact that the 65% of the debt portfolio is in euro, Although several years
despite the increase of for- making it susceptible to shifts in this currency's value", ex- ago it pledged that it
eign capitals, "the level of perts of the ministry of Finance say on this, adding that the would pay the entirety of
foreign debt will continue to trend has been a growing trend in the recent years, lowering debts owed to busi-
remain within the object by the capacity of the state to pay in foreign currency. "The pace nesses, it doesn't yet
aiming to reduce threats of the growth of debt has been quicker than the pace of growth
from shifts in foreign cur- for exports and currency reserves. This means that debt in for- seem to have won this
rency rates". Let us recall eign currency for our country is growing", they say, adding that "battle", as private
that this practice was initi- risk from currency rate shifts is high, however, it is expected to companies continue not
ated seven years ago, be reduced. to get paid about their
namely, in 2010, when Alba- works. Meanwhile,
nia borrowed 300 million almost all central govern-
euros in foreign markets, Experts: Borrowing in foreign Objective, public debt must go ment institutions have
considered as the first Alba- incurred outstanding
nian Eurobond. markets may have implications down to 63% of GDP in 2020 debts. Referring to the
With a minimum maturity recent data from the
period of 5 years, Albanian orrowing in foreign markets may have impli he government is aiming to reduce public debt ministry of Finance, for
taxpayers paid around 22.5 Bcations, which depend on the fiscal policies Tto 63% of GDP at the end of 2020. This is pro- the period July-Septem-
million euros a year worth of of other countries, but also on the European Cen- jected by the Medium-Term Debt Management Strat- ber 2017, the value of
interest for this loan. But, at tral Bank. This is another finding made by finan- egy. According to this document, during a period outstanding debts
the time, the 7.5 per cent cial experts. According to them, these conditions from 3 to 5 years, the domestic market will con- incurred by different
interest rate was considered will lead to an involuntary increase of debt, but tinue to be the main source of financing and cover institutions amounts to
a real success by the right also an increase of foreign debt, warning for a on average around 75 per cent of the general need 569.7 million lek. The
wing government. higher risk that foreign debt may not be paid. for loans for the central government. "The main in- institution with the largest
Meanwhile, the left wing "The restricted level of exports and currency struments that will be used to secure financing are
opposition criticized the ap- reserves may put the state in difficulty when pay- government bills. Meanwhile, state guarantees are amount of outstanding
debts is the General
plication of such practice, ing loans in foreign currency, thus threatening the expected to range from 5 to 6 per cent of the debt.
although when it came into stability of domestic currency and macro-eco- By 2020, the country is expected to pay around 45 Directorate of Taxes and
power, five years later, it nomic indicators", the Debt Management Medium- billion lek worth of debt", the strategy in question the value of outstanding
would issue the second Al- Term Strategy 2018-2020 states. says. debts is 100.2 million lek.