PRESS RELEASE
With regard to the IMF staff visit in Albania during October 17 - 21, 2005

An IMF staff visit was in Tirana during October 17-21, 2005, to discuss with the authorities the fiscal outcome of 2005 and the 2006 budget, and the broad priorities of a possible future agreement between the IMF and the government of Albania. There was agreement on key parameters of next year's budget and its underlying macroeconomic and fiscal policy assumptions, including the principles of a conservative fiscal platform and the implementation of an ambitious tax administration reform agenda.

An IMF staff visit, led by Mr. Istvan Székely, the new mission chief for Albania, was in Tirana during October 17-21, 2005. The purpose of the visit was to discuss with the authorities the fiscal outcome of 2005 and the 2006 budget, and to reach broad agreement on key fiscal parameters for next year. The overall priorities of a possible future agreement between the IMF and the government of Albania were also touched on, in particular financial sector reform, revenue administration, public debt management, and other growth-enhancing structural reforms. These discussions are expected to continue during an IMF mission to Tirana planned for November 8-21, 2005.

The mission met with the Prime Minister, the Ministers of Finance and Economy, the Central Bank of Albania Governor, advisers to the Prime Minister and other senior government officials, representatives of the donor and diplomatic community, and private sector representatives.

The IMF representatives and the government were in agreement on the key parameters of the 2006 budget and the underlying macroeconomic and fiscal policy assumptions. In particular, there was agreement on the principles of a conservative fiscal platform and on the priorities of the government for the coming fiscal year, including the implementation of an ambitious tax administration reform agenda based on the technical assistance report prepared by the IMF's Fiscal Affairs Department earlier this year.

Overall, the mission noted the government's strong commitment to swiftly implement necessary key measures, including its ambitious action plan for resolving the problems in the energy sector.

If agreement is reached in November on a future 3-year arrangement, and it is approved by the Executive Board of the IMF, there will be regular reviews during the tenure of the program. In particular, the first review would take place in six months. Depending on the outcome of this review, further fiscal policy and budget measures could be then contemplated by the authorities in consultation with IMF staff.

At the end of the mission, on Friday October 21 at 11.00, a joint press conference together with the Minister of Finance, Mr. Ridvan Bode, and the Central Bank of Albania Governor, Mr. Ardian Fullani, will be held at the Ministry of Finance.

Istvan Székely Ann-Margret Westin
Mission Chief Resident Representative