bank of albania have provided the necessary monetary stimulus to support the normal functioning of the financial markets and to ensure the flow of credit in the economy. interest rates for households and businesses are low and liquidity pressures are under control, while the exchange rate appears stable. the albanian banking sector remains sound, despite the challenges posed by the pandemic. the immediate operational measures taken by banks, as well as the macro and micro prudential measures taken by the bank of albania, ensured not only a continuation of the operation of the critical functions of the banks, but also satisfactory financial intermediation despite the great shock suffered by the economy. credit to economy is growing ( it grew by 6. 3 % in the third quarter 2020 ), capital is adequate and the banks ’ balance sheets remain healthy, signalling their ability to withstand first - round shocks. we are optimistic that the economic activity is expected to revitalize over the next two years. however, the economic outlook for the future is accompanied by a high level of uncertainty and downside risks. in the short term, the risks are mostly related to 1 / 3 bis central bankers'speeches the uncertainty of the pandemic itself, its severity, duration, and potential return of restricting measures. in the long run, the risks relate to the long - term damage sustained by the productive capacities and domestic demand, as well as potential structural change sustained in the economy as a result of the altered behaviour of economic agents. we are sure that research based evidence, analysis and forecasts will provide accurate and timely information for policy orientation and coordination. research in the area of monetary policy, financial stability and banking supervision has always dominated the topics of our workshop. this year covid - 19 has entered the agenda by brute force. this shock and the negative effects that it brought upon the economy and the central bank policies have been beyond comprehension. the authorities are feeling the difficulty of performing their task in the zero lower bound or very close to it. in this respect central banks have lost the traditional instruments of monetary policy and are reverting to money as the instrument of monetary policy. the shift has been significant not only in size but also in concept. the leading central banks in developed economies, the ones which set the trends, are under process of reviewing their objectives and monetary policy. using support of research analysis and conclusions they are eventually rewriting monetary economics by giving central banks new instrument in the form of permanent use of the central bank balance sheet as a tool of monetary

authorities should continue working to improve the credit environment, among other things, by strengthening contract enforcement, implementing new legal and sublegal procedures related to collateral execution, and completion of the remaining duties under the national programme for the reduction of non - performing loans. the signing of a memorandum of cooperation in the field of banking supervision, between the european central bank and the bank of albania, will facilitate the exchange of information and enhance the security of european banking groups that operate in albania. likewise, the completion of the restructuring and consolidation process of the banking sector, which has had and will continue to have our attention, is an additional guarantee in this regard. in parallel, the development of other segments of the capital markets should be further encouraged, yet with prudence, so as to avoid missteps, and in harmony with supervisory and regulatory norms and standards for the banking sector. second, the structural reform agenda should be accelerated. 2 / 3 bis central bankers'speeches the second phase of this reform should aim at improving the education and know - how of the labour force, creating a legal, political, administrative and fiscal environment that attracts foreign developments and encourages domestic ones, and increasing the integration of albania ’ s economy with the regional and european development infrastructure. third, the opening of accession negotiations with the eu should be viewed as a primary instrument for the advancement of albania ’ s development. the bank of albania judges that the fulfilment of the criteria for opening accession negotiations and the rigorous implementation of reforms that this process imposes should be the focus of the entire political spectrum in albania. thank you for your attention! 3 / 3 bis central bankers'speeches