World Bank keeps Albanias 2012 GDP forecast at 2%.

By bne IntelliNews January 19, 2012
The World Bank has maintained its GDP growth forecast for Albania for this year at 2%, the bank said in the January edition of its Global Economic Prospects. The countrys economic growth will slow down from 3% estimated for 2011, but it is projected to speed up to 3.5% y/y in 2013. Albanias economic development in 2012 will be highly dependable on the outcome of eurozone debt crisis. Albania and the countries from the region face declining external demand, as economic activity in the EU has weakened. According to the World Banks data, Albanias total exports to the EU averaged 44% of GDP in 2008-2010, the vast majority of which (84%) or 37% of total represented exports to high-spread European economies such as Greece and Italy. The bank also highlighted that Albania is exposed to external financing risk. According to the estimates, the countrys external financing needs in 2012 will account for 21.3% of the GDP. Heavy reliance on short-term debt makes Albania vulnerable to a tightening of international bank lending conditions, even if these were not associated with a wider crisis, the report read. Finally, the bank projected Albanias current account deficit at 9.7% of the GDP in 2012, down from 11.7% in 2011. The gap is projected to increase to 9.9% of GDP in 2013.
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