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Although the Bank of Albania, together with the AFSA (Financial Supervisory Authority) and the Ministry of Finance are pursuing a five-year de-euroisation package to strengthen the national currency, the figures show that the policy is not working.
The use of the euro in the banking system continues to be high with most bank deposits being in foreign currency, the same for loans, over half of the total.
In 2021, the foreign currency loan portfolio increased by ALL 36.2 billion, the largest expansion in the last three years, while the fact that interest rates in euros are lower than those in ALL
Director of Financial Stability, Klodion Shehu: Interest rates generally reflect the stage of development of a given economy. The euro economies are mature, consolidated, while the Albanian one is still developing.
In the conclusion of the report, the Bank of Albania claims that the measures have not been sufficient to reduce the level of the euro in the economy, requesting even more assistance from other institutions
Director of Financial Stability, Klodion Shehu: The use of the euro in the real economy is important and we certainly have our assessment, that this high use reduces the effectiveness of economic policies in general. For this reason we are of the opinion that the measures taken by the Bank of Albania should be followed by other measures in the real economy.
De-euroisation policies do not work even because the euro circulates at high levels in informality according to experts
Teuta Nunaj, economics expert: There is a lot of money outside of banking management and that is part of the informal economy. This is mainly money of remittances, but also money of the criminal world as evidenced. These need to be formalized.
In conditions when the policy to strengthen the national currency is not giving the desired effects, will the institutions or markets surrender to the euro?
Director of Financial Stability, Klodion Shehu: Jemi in the conditions when we think that not enough has been done yet to strengthen the use of the national currency in the Albanian economy. The use of euros or other currencies in day-to-day transactions or as a payment instrument is unnecessary and unreasonable. ”
Teuta Nunaj: It has always been proven that it is the market that forces institutions to take action.
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