In this context, I am proud that the Bank of Albania has always been and remains frontrunner of change. 3. Bank of Albania, an evolving institution Throughout the transition history, The Bank of Albania has shown able to change and embrace better contemporary and most effective practices. The nature and functions of the institution were fundamentally transformed in 1992, when the Albanian economy started the transition process towards a free market economy. Within a short period of time and in the presence of a shortage of an institutional heritage, the Bank of Albania succeeded to establish the contours of an independent monetary policy, being empowered in the presence of a free-floating exchange rate, regulate and supervise a private banking sector that functions based on the market principles. The qualitative transformation of the Bank of Albania towards a modern central bank evolved further with the approval of the new Law on the Bank of Albania in 1997, which lays down the primary objective “to achieve and maintain price stability”. This Law sets out the decision-making, financial and operational independence of the central bank in the pursuit of its objectives, in line with the best international practices. In addition, it is encouraging that this institutional independence enjoys a broad social consensus. During these years of transition, our monetary policy has marked a notable progress towards: developing a theoretical framework; building up the completion of our knowledge with empirical studies; perfecting the instruments for its implementation; and the transparent communication with the public.

In this context, the Bank of Albania: reduced the policy rate to a historical low of 0.5%, in March 2020, and established the needed operational conditions to supply with sufficient liquidity to banks; provided the necessary regulatory relief and instructed banks to help enterprises and 1/4  BIS central bankers' speeches  households in difficulties, through the placement of a short-term moratorium on credit instalments as well as in the form of a targeted credit restructuring; temporary forfeited the commissions applied by banks on the use of electronic payment platforms and the fees applied on the interbank transactions costs for the payment systems AIPS and AECH operated by the BoA; last, we suspended the distribution of profit from commercial banks for 2020 to enable the maintaining of capital adequacy of the banking system. The stimulating measures undertaken by the Bank of Albania were coordinated with an augmented fiscal stimulus. Fiscal stimuli were in the form of tax relief and direct transfers to households and enterprises, whose income were affected by the closure of the activity and in the form of sovereign guarantees on loans to enterprises, aimed at minimising the negative effect from income and preserving the liquid position in their balance sheets. The simulating macro-economic policies helped in containing the impact of the pandemic on the real and financial sectors of Albania, and succeeded in safeguarding the macroeconomic stability uncompromised. The economic contraction, fall of employment and the damage in the financial balances of enterprises resulted lower than our initial projections.