Albanian Finances in crisis

The difficult financial crisis has obliged the Minister of Finances to quickly prepare a draft to stop all budget spending.

The draft prepared by experts stops any new public investment procurement and freezes per diem and travel payments in the public administration.

Limiting spending in the middle of the budget year has turned into a tradition for the public finances since 2009, but the situation has got worse this time.

Sources from the Ministry of Finances say for Top Channel that it is necessary for the order to pass as soon as possible in the government, because the state finances are getting worse each day, to the point of not being able to pay emergency obligations.

The government exhausted 80% of the annual limit for the first months of the year, and in June this figure has grown even more.

Due to this situation, the Treasury has been unable to pay funds and this has been publicly accepted. According to these sources, 2 billion ALL of obligations have been created this months.

These bills have been officially created and accepted by the State Treasury, besides the mountain of due debts, which mounted up to 200 million EUR only through the last years.

The government’s financial situation is even more out of control now. After losing the elections, the fallen government doesn’t have the right to intervene in the budget. Chances are that the obligatory budget review will be made in October by the new government.

But with the revenues falling and the legal debt overpassed, the main risk of the new government will not be only the bad debt against business, but the government’s ability to pay pensions and wages on time.