the country ’ s productive capacity. consumer spending is low, primarily due to households ’ uncertainties about the future, but also due to their slowing income. the two other aggregate demand components also show limited ability in providing stable economic growth impulses : public spending is limited, due to lack of fiscal room because of a higher public debt, while albania ’ s exports suffer the sluggish demand from the international markets and the low degree of diversification. finally, business investments are downward, reflecting businesses ’ restricted room for boosting their sales and banks ’ tighter lending standards. bis central bankers ’ speeches the economy is a complex and interdependent mechanism. all the afore - mentioned factors have led to a sluggish labour market and elevated pressures on public finances. they have also increased vulnerabilities to many businesses and the non - performing loans in the banking system. in bank of albania ’ s opinion, this situation requires pursuit of stimulating macroeconomic policies. economic theory and practice suggest that the maintenance of macroeconomic balances is a prerequisite to pursue these policies. i have reiterated that these balances do exist in the albanian economy. they constitute a strong point for its future outlook. inflationary pressures remain weak, external balances of the economy are improving and the albanian financial system is healthy. but the macroeconomic balances should be maintained and further strengthened in the future. this objective is a preliminary filter and every macroeconomic incentive should pass through it. every macroeconomic stimulus should also consider another vital equilibrium : that of financial stability in the country, otherwise it is at risk of becoming unproductive. the global crisis has significantly elevated a country ’ s exposure to risks related to financial stability. therefore, this equilibrium should remain a constant priority and in concert with stimulating development policies. the healthier we are financially, the broader the spaces available to stimulate the development of the country. having said the above and availing myself of the presence of the three main stakeholders responsible for designing and implementing the macroeconomic policies, let me now share with you bank of albania ’ s opinion about promoting the country ’ s development in the short term. the bank of albania, being an independent institution, responsible for the monetary policy and for the supervision and regulation of the banking system, has taken concrete actions to boost demand in the economy. we have lowered the key interest rate to record lows and are considering other spaces available in this regard. we have also supplied the banking system with the liquidity needed

. these fundamentals can most efficiently be constructed through careful policies and structural reforms during ‘ good times ’. hence, a degree of perspective should be retained when designing solutions to any short term challenge we face. dear colleagues, the scale of future challenges is potentially greater compared to what we have faced so far. beyond ensuring the cyclical recovery of our economies, we have yet to properly account for the structural changes this crisis is bound to leave with us. i believe we can only rise up to this task if we heed the lessons learned so far and proceed in the spirit of mutual coordination and solidarity. thank you! 2 / 2 bis central bankers'speeches