“After a strong growth momentum in previous years, Albania's economy is expected to grow by 3.6% in 2025 and 3.5% in 2026, driven by domestic demand.” This is the European Commission's economic forecast for Albania, based on support from tourism and exports.
"Service exports are expected to continue to expand, while goods exports are expected to recover somewhat after two years of significant contraction ," the report said, according to A2 CNN.
According to the report, after a rapid decline in 2024, inflation is expected to gradually return to the 3% target next year.
While the fiscal deficit is expected to widen before falling below 2% of GDP in 2026.
"The current account deficit is expected to widen slightly from its historical low recorded in 2023, but remains well below its long-term average, indicating structural improvements driven by the growth of tourism. This outlook is subject to downside risks, related to changes in exchange rates and interest rates and growing shortages of skilled labor exacerbated by emigration," the report says, writes A2 CNN.
As a small open economy, Albania is exposed to external risks related to the economic impact of tariffs on its main trading partners in the EU, such as Italy. Furthermore, global uncertainty and geopolitical risks could affect foreign direct investment flows.
Meanwhile, the public debt-to-GDP ratio is projected to decrease only gradually, driven by nominal GDP growth. (A2 Televizion)
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