PRESS RELEASE
Governor Sejko: Address at the promotion of the book on the Bretton Woods Institutions and Albania, by Academic A. Angjeli

Honourable professors,

Dear colleagues,

Dear guests,

I have the pleasure to address to the launching event of the latest book “The Bretton Woods Institutions and Albania”, by prominent Academic Prof. Dr. Anastas Angjeli. The book presents a thorough and interesting description of the role that international institutions, the International Monetary Fund (IMF), the World Bank (WB) and the World Trade Organisation (WTO), have played for the stability and prosperity of our economy. The narrative in this book invites the reader to review the way we understand the economy and the role of domestic and international institutions in restoring confidence and laying the foundations for a sustainable economic growth, as well as ensuring investments in long-term development capacities with a view to supporting the economic and financial stability and prosperity of each country.

The history depicted in the book encompasses in discussion the entire context of economic theory, which by fully exploring the past evolves more reflection on the future. It delineates the challenges ahead, by underlining the role these institutions play in mitigating macroeconomic shocks and strengthening resilience against them.

The book narrates the Albania's historical journey and cooperation with the International Monetary Fund, the World Bank and the World Trade Organisation, while illustrating concrete and tangible examples for the reader. It provides valuable and practical knowledge about the compilation and implementation of the policies of these institutions in promoting financial stability and economic development, in addition to the policies we must undertake to avoid the "middle income trap".

I take this opportunity to point out the importance of this book to the Albanian and foreign readers, as well to the economic researchers, historians and diplomats, for some reasons:

First, the book, enriched with concrete illustrations and historical facts, displays how economic and financial balance and economic development are necessary and sufficient conditions for sustainable economic prosperity.

Second, the book presents a practical perspective for policy makers in expanding the analysis with descriptions and conclusions about future challenges and providing recommendations for addressing them.

Third, considering we are living in an increasingly global economy, it is important to highlight the international institutional collaboration to tackle the structural economic challenges. Also, for the formation, consolidation and support of institutions and mainly of the central bank.

Institutions, independence, professionalism, their role and importance are identified as a bridge between international institutions and the Albanian economy, as well as a crucial factor of the economic and financial stability of the country. At this point, the book is in full harmony with recent conclusions that institutions and their quality give an important contribution to explaining differences in development and prosperity among nations. In addition, the involved institutions are guarantors of the country's economic and financial stability, by bolstering and accelerating the economic and financial development, in turn the prosperity of the society.

In this perspective, I am confident that the Bank of Albania fully embodies these features and is an important pillar of the country's economic and financial stability, by playing also a vital role in the development and promotion of financial market, its stability and sustainability, as well of the financial inclusion of citizens. Above all, the Bank of Albania gives an important contribution to price stability, which is its main objective.

Statistics show that prices in the Albanian economy are less volatile compared to the euro area and regional economies, despite challenges we have dealt with have been a lot. The good management of monetary policy coordinated with the macro and micro-prudential policies, coupled with the innovations applied by the Bank of Albania in dealing with the important structural changes taking place in the Albanian economy have led to this success.

Over the last 5 years, our monetary policy has been quite flexible to respond to fluctuations in the aggregate demand and supply through prudent interest rate changes. Even in cases where the change in the interest rate was assessed as insufficient, the Bank of Albania has undertaken macro-prudential measures to support the monetary policy. All the implemented measures have driven to an eased financial situation of households and businesses by guaranteeing the positive performance of consumption, production and investments, as well as by minimizing the volatility in prices caused by the differences in the demand and supply.

The effects of the structural changes that the economy has faced in the structure of production, demographic developments and their impact on the labour market, the growth of foreign investments, tourism income and remittances in the Albanian economy are reflected in the exchange rate, which has played a dampening role by distributing the effects in all sectors of the real economy, as well as in inflation. In response to these structural changes, the monetary policy of the Bank of Albania has become innovative. The interventions for managing the foreign exchange reserve and control the speed of lek appreciation against the euro have enabled the mitigation of disinflationary pressures in prices originating from the exchange rate.

In parallel, the Bank of Albania has undertaken a number of other initiatives, regarding the increase of financial inclusion and financial literacy. The Law on “Payment account with basic features”, the application for our membership in SEPA and the Strategy on Financial Inclusion and Education, are expected to derive significant changes in the further development of the financial system, in terms of reducing informality and increasing the efficiency of monetary policy pass-through.

I re-affirm that the Bank of Albania will continue to maintain a prudential and innovative position for taking all the necessary measures to react in a timely manner and to the right extent to the economic and financial developments, taking into consideration the establishment of an economic environment with stable prices, as an instrument for preserving the value of citizens' savings and promoting sustainable and long-term growth of the country.

At the end of my speech, let me once again thank Professor Angjeli for this new book, which exhibits a story enriched with interesting facts and conclusions about the economy and finance. The book comes as an advice to all decision makers to work on our priorities for a sustainable and comprehensive economy alongside with our institutional companions. Only in this way will we build an economy ready to encounter any future challenge.

Thank you for your attention and I look forward to the next work by Academic Angjeli, which I am sure will address phenomena and issues of interest to all economists, researchers, and students.

Thank You!