New Prime Minister Edi Rama on Thursday said he will make paying off the debt owed by the government to public contractors a priority.
“The economy has been tangled in a web of debts that we need to pay off,” Rama told a conference in Tirana.

“We cannot act like this debt does not exist and leave the burden to the private sector that is being asphyxiated,” he added.

According to a report by the High State Auditing Office that was leaked recently to the media, Albania owes at least 43 billion lek (€300 million) to public contractors in unpaid bills.

The figure is not included as part of the national debt, which has reached 61 per cent of GDP, the largest in the Balkan region.

The Socialist-led coalition, which won the June 23 parliamentary elections, has expressed concern over the state of Albania’s finances, complaining especially of the poor rate of collection of taxes in the first eight months of 2013.

Experts suggest that Albania might collect €320 million less in taxes than was planned in 2013, while continuing to run a high budget deficit.

Although economic growth this year is expected to be positive, at 1.8 per cent of GDP, rising public debt and poor tax collection rates are causing concern.

Rama said the government would carry out a thorough audit of public finances in order to shed light on the real size of the public debt.

“Our economy has been dependent on remittances and debt, which has now reached its highest level in history,” he said. “We will tackle this debt at any cost,” he concluded. Balkaninsight