PRESS RELEASE
Interview of the Governor of the Bank of Albania, Mr. Ardian Fullani given to Voice of America, ''The Bank of Albania is a responsible and an independent institution'', Washington, September 24, 2005

Voice of America: Mr. Fullani, you have just signed the project on the administration of currency reserves with the World Bank. What shall Albania benefit from this project?

Ardian Fullani: This program is part of my vision for the Central Bank. To the accomplishment of this vision, I would like to express my sincere thanks to the World Bank, which assisted us during our eight-month cooperation to the finalization of the agreement signed today (Friday). This is an expression of an outstanding close bilateral cooperation with the World Bank. This cooperation bears a significant importance for other projects as well, such as Real Time Gross Settlements (RTGS), Automated Electronic Clearing House (AECH) system, which is now finalized and it shall be a very sound foundation for the "utility" payments. This payment system via banks and undoubtedly, by increasing the number of credit cards, shall be an encouragement to the perfection of the payment system, fight against the informal economy and at the same time, it shall influence on the reduction of cash circulation in economy. By means of this agreement with the World Bank, in two to three years, Albania shall not only benefit the administration of that part administered by the World Bank, but at the finalization of this project, it shall be technically and administratively capable of administering its currency reserve under contemporary principles, itself.

Voice of America: Budget deficit remains challenging to the Albanian finances. A few days ago, the Government approved a decision to reduce the small businesses taxes by half. Did the Albanian Government consult any of the international institutions and your institution before reaching such a decision, and what shall be the impact over the Albanian budget deficit?

Ardian Fullani: Albania is part of Monetary Fund program and we are present here (in Washington) together with the Minister of Finance, to discuss all issues related to fiscal policy and monetary policy of the Bank of Albania. Evidently, this new initiative shall be taken into consideration by the new program, compiled in cooperation with the Monetary Fund, and at the same time, all possible calculations shall be made for next year budget. What is important is that the Ministry of Finance and the Bank of Albania should further enhance their cooperation to the establishment of one or more new instruments for the administration of domestic debt. Regarding the decisions it takes, the Government has a wide consultation net and all these (expected) effects shall be an object for discussion here with the (World Bank) in order to have a better grounding for the next year budget.

Voice of America: Mr. Fullani, the Albanian press has recently published sceptical articles regarding high interest rates of treasury bills. How does this issue relate to your initiative to liberalise the Treasury bills market for commercial banks?

Ardian Fullani: The message we give, and it was quite evident in the Statement of the Bank of Albania a few days ago, is that we all have to realize that now, we do have a private market; we now have what we had hoped for. In the first days of my assignment as a Governor, I stated that year 2005 and on, shall be different from year 2004, because there is a different market. At least 60 percent of a state-owned market, such as the Savings Bank, now is privatised. There is a bank with private features, which, above all, has its own principles of consolidation and achievement of good financial results.

Voice of America: Has the change of the political majority and the ministers in the economy sector affected your work, as an independent institution?

Ardian Fullani: I believe that the Bank of Albania is a consolidated, independent, responsible, and above all, a vigilant institution. I emphasize vigilant, for the care that we provide to the market. If there is an increase of Treasury bill yields, it implies that the market is acting as it should in a private manner. If there are "distortions", manipulations, or disproportions regarding the monopoly or competition role, these are issues to be carefully looked at, and we are paying a special attention to them. Pursuant to the law, the Bank of Albania is an independent, well-organized institution, with its foremost objective of maintaining price stability. Changes have always been considered in the cooperation context and such a concept derives from me and the institution I represent; the concept of cooperation is crucial and essential to the Central Bank, it is a modern concept. Being an independent institution, it should be at the same time, a responsible and collaborative institution, with the Government, Ministry of Finance, Ministry of Economy and other ministries, in order to achieve the main goal, macroeconomic and financial stability.