Energy crisis, fires force gov't to revise 2017 budgets: Albania

The energy crisis | Torange

Emergency in power supply caused by the prolonged drought this summer and the wildfires situation has forced the Albanian government amend budget and make some funds reallocation, a press release from the Council of Ministers said.

Acting upon the situation, the Albanian government adopted a normative act late Wednesday through which it made some changes to the budget of 2017.

Through this normative act, the government decided to increase the current electricity purchase fund by 3 billion leks or approximately 30 million U.S. dollars, bringing it from 1.5 billion leks to 4.5 billion leks, said the source.

According to the press release, up to 1.2 billion leks of this fund will be used for unforeseen cases of budgetary institutions while 500 million leks will be used for the establishment and functioning of new justice system institutions. Also, 1 billion leks will be used to cope with natural emergencies, Council of Ministers announced.

Meanwhile, the government said that the revised budget envisages growth in both revenue as well as budget spending. Revenues saw a growth of 2 billion lek or roughly 20 million U.S. dollars, going up from 436.4 billion leks to 438.4 billion leks. Meanwhile, the budget deficit remains unchanged at the level of 31.1 billion leks.

Albania’s internal electricity generation capacity is about 98 per cent dependent on hydropower. The two main cascades on the Drin and Mat rivers produce over 94 per cent of domestic electricity and normally supply more than 65 per cent of the country’s total net demand.

The energy crisis presents a great danger for Albania. It affects all medium-term economic indicators and could create a shortfall in revenue in this year budget.