albanian economy and society. the response of authorities in albania, like across the world, was fast and unprecedented. the bank of albania intervened through a package of monetary and financial measures. these measures were aimed at containing the short - term impact of the pandemic and safeguarding the production capacities and the economic and financial stability of albania. these are two indispensable preconditions for the rapid, solid and long - lasting growth of the country. 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. the banking sector continues to be well - capitalised, liquid and profitable. the risk premia and interest rates in the financial market remain at low levels, by underpinning lending to the economy, in response to its needs for working capital, consumption and investments. in particular, non - performing loans ratio remains at a low level, notwithstanding the worsened cyclical position of the economy, by showing the benefits of the banking sector ’ s consolidation process and the advantages of the continuous improvements in the regulatory and supervisory framework. the undertaken

simulating policies have helped in reducing risk in the short run, but they cannot address structural changes, which have been noted from times now or which are directly related to the pandemic. a “ new normal ” is expected to guide the need for the adaption of the private sector and a re - thinking of the institutional government paradigms. 2. challenges of the future policy - making institutions are expected to tackle complex structural challenges, which will determine the shape and content of a new reality within a not too far future. the increase of barriers in international trade, the population ageing, international migration, decrease of innovation, global warming, the growth of inequality and increasing social tensions, are critical global issues. public authorities, in their response, should engage, without losing time, in coordinated structural reforms – among others – bolstering innovation and reallocation of sources among the sectors of economy, free trade, stability of pensions system and maintenance of social consensus. further, a “ new normal ” would call for a prudential coordination of public policies, for reaching an optimum balance between the economic growth and the economic, monetary and financial stability. allow me to elaborate somewhat further on this issue. the global financial crisis and the pandemic renewed attention to the indispensable role of fiscal policy : an instrument for the stabilisation of the economy and mitigation of crises. this lesson is expected to be relevant – both in medium - term and long - term - by paving the path to a more active role of fiscal policy in the future. nevertheless, it should in no case skip the need for preserving the fiscal stability. in contrary, fiscal stability remains a precondition to long - term 2 / 4 bis central bankers'speeches growth and enables the establishment of the necessary premises for the amortisation of shocks. in the area of central banking, the “ new normal ” will continue to be characterised by a flatter phillips curve, where wages, employment or economic growth will continue to have a weak relation to inflation. challenges to maintaining price stability will continue to be present. it dictates the need for the improvement of transmission mechanism of monetary policy by making indispensable the exploring of unconventional instruments as feasible and valuable alternatives for managing future shocks. all these challenges lead to the need for enhancing the flexibility of public institutions making them more able to evolve, adapt to changes around them, and to boost innovation. in this context, i am proud that the bank of