ECONOMY

Albania’s 2008 budget sees record 7.9 percent deficit

TIRANA (Reuters) – Albania yesterday passed its 2008 budget, the country’s biggest ever, targeting a record 7.9 percent deficit and growth of around 6 percent. Finance Minister Ridvan Bode told parliament public spending was seen at 369 billion leks ($4.6 billion), or 34.3 percent of GDP. Total 2008 revenue was estimated at 283.7 billion leks. «This budget aims to increase revenues while cutting taxes, raise public spending to optimal levels and support reforms that will bring Albania closer to the European Union,» Bode said. The deficit, he said, was «exceptional» and, for 2008 only, going to finance large infrastructure projects, such as a highway linking the Albanian coast with Serbia’s ethnic-Albanian-majority breakaway Kosovo province. Bode said that maintaining the current 6 percent growth rate would depend on the electricity supply. The country suffers power cuts of up to 15 hours a day. Growth would also depend on global oil prices, and a deepening trade deficit with European Union countries as a result of a deal that stipulates the gradual phasing out of tariffs.