From the perspective of underpinning policies, economic activity expanded, favoured by the following: The accommodative monetary policy and the favourable financing conditions, in both domestic and foreign markets; The fiscal consolidation, which has reduced the impact of the public sector on the domestic financial markets; and The structural reforms programme, which, irrespective of the short-term costs, have started to yield initial results. Economic growth has contributed to the overall improvement of Albania’s economic and financial balances. In line with our previous statements, the following is notable: Inflation edged up slightly, despite the containing effect of the sharp appreciation of the exchange rate, suggesting that the improvement of the cyclical position of the economy is beginning to be reflected in higher wages and other production costs; Albania’s external position has improved, reflected in the narrowing of the current account deficit;  Budget deficit remains low and public debt has trended down; Lastly, Albania’s financial system is stable. The Albanian banking sector shows stable or improving capital, liquidity and profitability indicators. Our analyses and stress tests suggest that the sector is resilient to potential stressful situations, thus guaranteeing its ability to withstand shocks. 1/3  BIS central bankers' speeches  Such analyses show that the foundations of the country’s development remain relatively solid. The analysis is reflected also in our projections. In the baseline scenario, these projections suggest that economic growth will continue in the medium-term horizon, production capacities will be utilised in fuller terms, and inflation will converge to the central bank target by 2020.

Gent Sejko: Statement at the joint press conference with the IMF Mission Chief for Albania and the Albanian Minister of Finance, 20 November 2018 Statement by Mr Gent Sejko, Governor of the Bank of Albania, at the joint press conference with the IMF Mission Chief for Albania and the Albanian Minister of Finance, Tirana, 20 November 2018. * * * Dear media representatives, In the last two weeks we have been engaged in discussions with the IMF Mission, which visited Albania in the framework of periodic Article IV consultations. Such discussions focus on the current performance of the economy and financial markets in Albania, their outlook, as well as the adequate economic policies and necessary structural reforms that should be implemented and monitored with a view to guaranteeing sustainable development for the country. I must say, with pleasure, that we share similar views on development trends, challenges that lie ahead, and the respective measures for tackling them. Let me now present in brief the opinion of the Bank of Albania on these issues. The positive trend of Albania’s economic development continued throughout the current year. From the perspective of aggregate demand, economic growth was supported mainly by the expansion of consumption, investments and Albanian exports. From the perspective of production sectors, economic growth reflected mainly the expansion of the industry and services sectors, driven to a large extent also by the rise in electricity generation.