Press conference of Prime Minister Edi Rama in conclusion of the second 300-day period:
This is a final conference for this season before you start your well-deserved holidays. As always, we will start an overview on the facts and figures which, I believe, create a meaningful view of the second 300 day-period in government following the first 300 days which were crucial to determine the necessary turnaround and to target the right direction.
- Economy
I’m starting with the economy, recalling that the negative trend was broken since the first quarter of the government, and the positive turn began after a series of previous quarters in decline. Actually, in 2014, after the first quarter of governance, the economy continued on a stable positive trend, in line with the provisions set out when the International Monetary Fund program was signed.
The year 2014 was closed with an increase by 2.12%. Meanwhile, it is encouraging to notice that the first quarter of 2015 has marked a continuous trend growth and, taking into account the reasonable suspicion that the crisis in Greece would have its impact, it was closed with 2.82% versus the first quarter of 2014. It is quite a significant figure. We continue to believe that by the end of the year we will be back within the target set in the program, and we will be very close or totally close to 3% increase.
In relation to all allusions or wrong predictions, this fact constitutes a significant reason that our initiative for the debt, in addition to the moral effect of the relationship between government and contractors, would have no effect on the economy. The opposite is true. We believe that the payment of 350 million dollars in arrears in 2014, and the fact that a total of 641 million dollars of debts to contractors in all sectors has been written off to date, have had a direct impact on the consolidation of the positive trend of economic growth.
Now, the procedure for debt repayment is almost complete, except for a series of recent reconciliations which need to be reviewed. It should be taken into high consideration that it was an absolutely transparent and fair procedure. In the meantime, many claims, which may have been based de facto, but not de jure, therefore on regular legal documents, have not been taken into account, for they could not be taken into account.
In addition, I want to underline the fact that this has been a process with zero complaints for corruption. The method used has guaranteed a totally uncontested and incontestable process, because duties were not paid on the basis of an order determined by the government or on the wishes of the institution leading this process, the Ministry of Finance, but they were paid based on the debt chronology.
On the other hand, a part of the funds provided by the payment of taxes are used by enterprises to repay arrears to tax and customs administration. This is a necessary condition which has been determined in the strategy for removing this huge immoral and of course financial burden of the government towards contractors.
A significant portion of these funds have been used by enterprises to repay part of the loans with commercial banks. In this context it is worth noting that this operation has had a role in both preventing further growth of bad loans to a certain extent, and in their reduction. Let’s not forget that in September of 2013, when we took office, bad loans had exceeded 24% and tended to go to 25%. This was an alarming figure with a very negative connotation for the economy. In December 2014, it went below 23% and in May 2015, based on data of the Albanian Association of Banks, it was under 22%.
The plan for further reduction of bad loans is an action plan. I must say, thanking the governor of the Bank of Albania in the first place, that institutions coordination and the very active role of the Bank of Albania in this direction give us reasonable assurance that we will have a further and significant reduction of bad loans. On the other hand, by the end of 2014 we have substantially increased deposits in commercial banks, with 240 million more than a year ago.
Stabilizing and keeping control of external debt is another important step in the whole process of overcoming a situation of chaos in the country and in the state budget, and a moment of unpredictability as was the moment when we took office, in this regard.
For the first half of this year, the debt level is below 70%, namely, 69.9%. If we exclude the impact of arrears settled in 2015, and the effect of the exchange rate that is outside government control, we have a debt reduction under 69%, i.e. 68.2%. I am saying this for all those who talk about inflated and completely manipulated figures when referring to debt. But, if we exclude the total amount of paid off arrears which is 641 million dollars, then the real indicator of debt is under 65%; it is exactly 64.6%. Let me remind you that we have been said to have increased the debt, while we have done neither more nor less but legalize a debt that the government could not help but recognize and pay to contractors for services received , from public works to the services received for schools or hospitals.
Meanwhile, thanks to the adoption of the strategy of public finance management, which gives way to continuous quality improvement in the use of public funds, we have opened the way of receiving the first grant from the European Union in the form of budgetary support, because this strategy has been highly appreciated by partners. The beginning of the transition from conditional grants to budget support by the European Union marks a new stage of relations, in this regard, with the European Commission.
We have under total control the budget deficit, and up to last June 30 the level of budget deficit was 50% lower than it was envisaged for the period. So, the debt level has been kept under total control, also as a result of a good administration of the deficit.
- Revenue
The total revenue for the period July 2014 – June 2015 is 287 million dollars or 8.3% higher than the period July-June 2013-2014. Income tax for the period July 2014-June 2015 is 231 million higher compared to the same period of one year before, or 7.3%. Total revenues for the first six months of 2015, from January to June are $ 77 million higher than the first half of 2014.
But we are in the process and towards the end of a very thorough analysis of all the reasons for the revenue decrease, compared with the forecast. We are doing this analysis with high international expertise that is part of a process of reform and transformation of the way the Ministry of Finance, customs, taxation work in relation to concrete figures. We do not have an exhaustive overview because the process has not finished yet, but one thing is sure, we are changing our economic model. On the one hand we have an increase of 2.82% of the economy, on the other hand we have a revenue decline reflecting among other things, not only change in the economy structure with a significant increase of the GDP, but a significant increase in imports of machinery to our country, which implies that it has started to move in the right direction, and according to our major objective for changing our economic model, the entire enterprise is now investing much more than before in production lines and processing lines.
Decline in oil imports has had its role, as a result of the growth of domestic oil production and its processing in the country, but we will have an exhaustive overview at the end of this analysis, which will determine also our approach in relation to the revenue plan for the rest of the year.
- Tax relief
For two consecutive years, that is, for two seasons in a row, along with the budget this government has adopted fiscal packages that have come with significant mitigating rather than restrictive measures. 10 new mitigating measures were presented in the 2014 package, with a US $ 97 million impact on the state budget allocated to individuals or companies. This means more money for consumption and more money for direct investment to citizens.
These measures, together with measures taken a year ago, enabled 97% of Albanians to pay less tax and receive up to one more salary per year thanks to the abolition of the flat tax and the establishment of fair taxation. 12 new measures were added in the 2015 package, with $ 15 million impact on the state budget, and direct contribution to facilitate production, especially in agriculture.
Today, in addition to this aspect, automatic refunding is another completely new aspect and very welcomed by the enterprise. So, no more procrastination in reimbursement of VAT to enterprises, because it will be carried out within 30 days for toll manufacturing and other exporters, and within 60 days for other businesses. This means that this process of direct reimbursement has its effect in relation to access and income flow. A direct effect has also the change in principle of the methodology in revenue production, which is no longer based on calls and violation of businesses in order to implement the plan. These stories are over. We do not produce any more revenue plans by borrowing in advance from the companies, as it used to be for many years. Enterprises will use the value added that has not been paid by tax authorities to pay other tax liabilities. So, this is done automatically. This relief brings a fundamental change in the relationship between government and enterprise.
- Employment
Referring to the labor force survey, which has been published, the number of employees is 10% higher compared with the first quarter of 2014, and there is an increase of 103.945 people. In addition, there is another significant fact. Some 121.106 new work forces have been registered since our first day in government, and this is not said by polls, but by the Albanian state payroll and the non-agricultural sector. A very meaningful figure, which certainly has not solved the problem of unemployment in Albania, but which gives us a very clear indication on the efficiency of the government’s new policies, and on the efficiency of the new administration since we took office.
100 million dollars have been added to the state coffers as an amount available for pension, after an increasing number of people were freed from the slavery of illegal work and regularized. In fact, this growth ensures a successful implementation of the pension reform, and the beginning of the end of the terrible deficit inherited by the scheme of pension theft due to which not only the scheme but our entire funding system of pensions was in danger of collapsing.
There is another fact for all those who have been contrary to the progressive tax, because it would reduce the number of registered workers, especially in upper rural areas.
So, for salaries exceeding 1 million 500 thousand (old) ALL, where some predicted that a tragedy was going to happen, we went from 6800 individuals to 8600 individuals. This means that there are approximately 2 thousand more declarers and approximately 2 thousand more taxpayers of a tax that has been fairly increased for that category because, as we told even before taking office, those who earn more will pay more.
- Consumption
Ultimately, what constitutes the most meaningful, the most significant and indisputable figure or fact concerning the state of the economy is consumption.
Has consumption increased or decreased?
In fact, we have increased consumption. In 2014, retail trade marked an increase by 6.4% in value, and 7% in volume. While in the first quarter of 2015, the volume index of retail sales increased by 4.7% compared with the first quarter of 2014. Meanwhile, in the retail trade group, excluding retail trade of hydrocarbons, where for proce reasons this index is not the same, in the entire group of retail trade we have a 9.5% increase versus the same quarter a year ago. Fortunately, this is not a matter of opinion, but a matter of numbers and direct experience of both the enterprise involved in retail sales and of the customer.
- Production, import & export
I do not want to make long lists. I just want to say that, as far as import is concerned, we have marked an increase by 14%, or an amount of $ 1 billion for imports of machinery and equipment. This means that there has been a turning point in the orientation of businesses and the money that businesses invest in foreign direct investment in technology. That presumes growth, increased production and processing lines, and real employment growth. This growth has continued also in 2015. 10 million dollars more have been spent in machinery in the first six months compared with the same period of last year, which was of course a very significant figure.
Let’s look at exports. Overall, they have increased by 9% in value than before. Thanks to an intensive support by our part to manufacturing, there has been an increase by 140 million dollars, including, not in this amount, also an increase in the export of plastics. While in the first half of 2015, the export grew by 54 million compared with a year ago.
On the other hand, there has been a significant increase in agricultural exports. In 2014, they increased by 20%, but this year’s figures – which are also the figures of the first but not final impact of our new policy for promoting the sector with a view to increasing exports – increased by 24% in the first quarter. During this quarter, and according to the preliminary data of the second quarter, exports have doubled compared with a year ago in some of the main regions of the country where production for export is more intensive.
A very important fact is the change that has begun in the structure of labor and interaction in agriculture, thanks to the support that we have given to agricultural enterprises, and thanks to the conditions that we have provided in order to start creating the value chain, thus making possible the opening of an alternative road to avoid land fragmentation, a great harm that has historically been caused to the sector. The intent is to make land fragmentation irrelevant, because no matter how much land is available to farming families, involvement of every farming family in the production scheme, and in view of the value chain that has its center entrepreneurship, through orientation and coordination of entrepreneurship, makes possible for everybody in their own share to be directly connected to the profit, but collectively organized because they use the same seed, the same crops, the same process, in view of a guaranteed sale.
Here we will aim more strongly also with the new package that we are preparing, and which will be implemented in the autumn of this year. We will make available to agricultural enterprises 300 million Euros in the next three years, divided into an average of 100 million per year. In doing so, we ensure that all applications, which until now have been denied due to financial difficulties of the state, will be accepted when they meet the standards. Direct lending to agriculture by commercial banks is made on the basis of risk guarantee taken by the state, and the reduction of interests to zero, through direct state contribution.
Meanwhile, the relation between farmers and the bank will be mediated by the state through the Paying Agency, a.k.a. ARDA. This means that the huge influx of applications will not be rejected as a result of the inability to give loans to agriculture. We expect from this a radical transformation of the entire sector, and an exponential growth of entrepreneurship in agriculture.
In parallel, we are working and are negotiating a package of financial support in order to take the irrigation and drainage system out of the medieval situation that we inherited, and to ensure that in the next three years – as a final objective, but our aim is to do it in a shorter time – all arable lands will have water, and farmers will neither dry out nor be flooded due to lack of the canalization system. This is a package that we will launch along with the new local government.
In fact, we have marked a turning point from the agriculture of illusions and alms for survival to the agriculture of production, benefits and welfare. Of course, there is still much to do. I must emphasize that everything I am saying, all the figures that I gave and all these elements that together show a positive trend of the economy, do not mean that I or we are pleased with these results, and that for me or for us the economy is booming. Absolutely not! They mean that after an era of chaos, where development rights were given without any criteria and no measures were ever taken to ensure liability towards development, we have entered a new era. Look at all sectors, and in every sector history shows a fact: development rights given indiscriminately, concessions, territory given away without any criteria, endless constructions, mines, HPPs, universities – anyone could have these development rights but no one was responsible for the cost of this development. This was done in complete absence of the state and of the mechanisms that should provide monitoring of the exercise of these rights, and nobody would take from these rights benefits for the people. Therefore, the country we inherited was a real mess.
Today, we can say that we are at a steady turning point and the foundations for having tomorrow a really developed economy are being laid with difficulty, with sacrifice, and obviously with some costs, but they are being laid once and for all.
I’m not dwelling on figures in the agricultural sector, but I will only give you the news that we have completed the preparation of the digital registry of agricultural land in 41 former towns and municipalities. This is not much, but it is the beginning of a radical change in relation to land inventory. We have inherited a country without inventory. A country where every square meter has 3 contenders for the right to property, not to mention the lack of inventories for surface and underground infrastructure. What’s important for us in this case, is that this register will be extended intensively, in cooperation with the new local government, across the whole territory of the Republic of Albania.
- Foreign investments
You have heard pipes being played incessantly about decrease of foreign investments, about foreign investors leaving the country, about devastation of our lands in relation to foreign investments. But the data of the Bank of Albania for 2014 show that the value of foreign investments has amounted to 878 million Euros, while in the first quarter of 2015 it increased by 50.5% compared with the same period of a year ago. Meanwhile, -please, refer to records – we have 948 new foreign companies. This increase is not comparable to any other previous year. It’s an increase by 30% of the pace of new investments, and 16.731 new companies were registered in 2014 only. This marks the highest point of all years. Is this enough? It is absolutely not enough! These are not successes; they are results and achievements in the process of a work that still has a lot to give. But it is certain that these figures are directly verifiable by state registries.
I won’t dwell on TAP or with figures and data related to investments, but let me just remember you that in the meantime we have had encouraging assessments of international financial institutions. For instance, Standard & Poor’s upgraded twice the assessment for the economy of our country. Doing Business Report and Foreign Policy Report have had encouraging improvements that do not make us happy, but motivate us to do much more, because the goals are much more ambitious than the current achievements. There is also the World Bank study, and in the end, as a direct result of these improvements, the allocation to Albania by the World Bank of the largest amount of financial support ever granted in its program in our country, with the explanatory statement by the Board of Executive Directors of the Bank, which I quote: “The government’s strong determination and the historic opportunity created by this determination to separate from the past.” This was said by a financial institution that cannot grant money unless there is a reliable basis for this, and which cannot make such statements being it a large international financial institution, and not the party newspaper.
I won’t dwell on the region either, but I will certainly say a few words about the increased cooperation with Kosovo and, in fact, about the work for the common transit corridor, whose target is – it is not propaganda, but it is part of a job started – that all transits opened in the territory of Albania will be closed in the customs of Kosovo, thus avoiding stops at the border for redoing procedures. Vice versa, the transits opened in the customs of Kosovo will be closed in the Albanian customs. Thus, Albania and Kosovo will work as if they had only one customs office, and we’ll have the customs union, which we talked about earlier. A procedure that used to last up to two or more days, due to financial guarantees and bureaucracy, will last no more than five minutes. Meanwhile, as we have seen, we have added lanes at the main crossing point of Morine, in order to facilitate the passage of people and goods.
We are actively involved and have a more active role, well-known and recognized, at the Berlin Process. We will go to Vienna for the second stage of the process in late August. Same as before, this time we will have a more active approach, and we will go with concrete proposals regarding access, not just projects.
I won’t dwell on the historical visits and personalities who have been visiting Albania. It is something that my predecessor used to do much better and with much more pathos, and I cannot compete with him, although I believe that the quality of Albania’s foreign relations does not compare with the quality of the relationships that we found. I believe that the visits that we have had talk by themselves, and there is no need for me to speak.
Coming back to our country’s issues, I want to talk about the other side of the coin, the part that deals with the rights on responsibilities; which means with the sectors where the state had to take responsibility and ask all actors having rights to take their own responsibilities. I mean here, for example, all those who have rights on quarries, mines, hydropower plants and so on, and who didn’t care at all about accountability because no one would hold them accountable in relation to the environment. Even here, we are making a historical turning point. All those who have been granted the right will respond one by one, by directly investing in the environmental rehabilitation and compensation of surfaces based on what they have received, as it is actually envisaged in the contracts that have never been implemented.
On the other hand, we have made a large funding in forests.
I will remind you just one fact. Albania has returned for the first time to intensive planting of new seedlings. We planted 2 million new seedlings in 2014, and by the end of 2015 we will reach the figure of 5 million new seedlings. This is an important moment in the first place, of awareness of the role that the government should play. On the other hand, you are witnesses, although you have not seen it with your own eyes, but you know it from the stories and reports of your colleagues, we have done a considerable work to rehabilitate protected areas. Just look at the protected area of Karavasta where we ensured the return of other creatures who had left Albania under the attack from humans engaged in such an animal behavior that was unrivaled by any of the animals that used to inhabit the area of Karavasta. The moratorium, the ban on hunting, has ensured the return of many species and, indeed, the rebirth of creatures throughout the area, in addition to curbing the barbaric cutting of forests and transforming the area into an increasingly visited attraction. I take this occasion to suggest you to visit it. For further details you can contact the local MP, who is intensely involved and who has a special merit for everything that has happened in that area.
I would look now at another aspect that has to do with social support. Often, mainly due to the operation for putting back on the right track the sector of electricity distribution, we have heard a deafening music of pipes regarding the unsocial nature of our government. The opposite is true. The figures show that this government has invested in social support more than any other government. The pension reform is one of the main reasons to be proud of what we have succeeded to do at this stage of government. In fact, the 1.2 billion increase of the Pension Fund, in order to implement the new scheme, is a meaningful example of the attention and the achievement of the objective to increase social support. Meanwhile, it is not useless to repeat that we finally removed the caps that used to keep all pensioners of Albania under the level of 240 thousand ALL, in addition to ensuring real increase of pensions for rural areas, from 2% to 40% according to their contributions. On the other hand we made available the social pension, lowered the retirement age for miners, and this month we increased the pensions of 6.600 war veterans up to 15.6%. Whereas, indexation of 1.4% was done for all other pensioners.
In the second 300 days of government, figures showing our commitment in relation to those who have suffered political persecution are also meaningful. During the second 300 days of government, former persecuted people who still live were compensated with 27 million 400 thousand dollars. 13 million dollars have been paid in these 6 months only, and the distribution of the 5th installment has started for those who have really been imprisoned and who are alive. Meanwhile, many of their fellows passed away without even receiving the first installment, when the country was ruled by those who call themselves the party that represents the interests of this category. In addition, compensation has been given also to the successors of the persecuted, as provided for by law, and in these six months only there have been over 1.500 beneficiaries.
I’m not dwelling on the law on records. You know the story. But I believe that this is one more reason to say that from a moral standpoint, this government has done in relation to the past more than any other government, either they were right-wing or left-wing. In addition, in this period only, an Albanian government thought and did something tangible about immigrants. Agreement for social protection of migrants have been signed with Macedonia, Luxembourg, Romania and Hungary, and we are waiting for bilateral draft agreements with Germany and the Czech Republic to be finalized. These agreements, including social security agreement with Canada, are expected to be completed in autumn of this year. As part of this process, we have started communication with the governments of Italy, Spain, Croatia, Denmark, France and Bulgaria, and we will start negotiations for social protection, therefore, to ensure that immigrants are recognized pensions.
Meanwhile, we have started work to finalize a major commitment of the “Alliance for European Albania”, a commitment that is in the program of both parties of the Alliance, to ensure the vote of immigrants. Today, I cannot say: “Yes, immigrants will vote in 2017”, but I am able to tell you that we will do our best to provide the vote of immigrants in 2017. Let’s be very clear on this point, so that tomorrow we won’t read headlines, such as: “Immigrants to vote in 2017”. We will work so that immigrants can vote in 2017, and this is a target that we will follow with a lot of perseverance. Its feasibility depends on many technicalities which will certainly be handled by experts.
- Education
Like any other government, ours also can be called into question for many things, but it is out of question that this has been the best period of education governance, that it has been the most significant period in education reform. This is due primarily to our Minister of Education who, in the beginning, was seen with skepticism but who proved that a high school principal can run education better than all the professors who have run it in the past. Today, we are entering a new phase within the education system. We are at a time when we have set some mechanisms, firstly to fight corruption in education – which has been a nightmare and continues to be a sworn opponent of the quality of education – and have passed in a new stage where a completely new mechanism is used for appointing teachers through the Portal of Teachers for Albania.
On the other hand, we have taken forward the project of schools as Community Centers. 180 schools across the country operate as such. In addition, 60 high schools of the country will start this September to implement digital learning through 120 intelligent classes. Our aim is to extend this across the country, but it will initially be implemented in these 60 high schools, this September.
Let’s talk about textbooks. We had become the most embarrassing banana republic in relation to textbooks. 1.130 textbooks. Not only the number, but also their content was frightening. Last year we cleaned 120 problematic textbooks, while this school year we have freed students from 470 other textbooks, following a secret ballot of teachers across the Republic of Albania.
We reformed Altertekst, and limited alternatives. This school year, students will not only have the best textbooks available, but more importantly in first and sixth grades scientific subjects will be taught on textbooks of the three largest and world famous publishing houses such as Oxford, Cambridge and Pearson. We will learn from the best, because students don’t have to be victims of our science learning process. This is a completely new methodology. Next year it will be applied to the 2nd and 7th grade, and within three years the whole cycle of study will have available textbooks from the best publishing houses worldwide.
Digital learning programs will be introduced in parallel. Students will also have available programs they can check on their computers, in order to have a complete picture of what is written in books. These also will be produced by these publishing houses.
I won’t dwell on higher education. I believe that you have listened to what I and we have said on this matter. I consider a great victory the overthrowing of a ridiculous system, as collectivist and parasitic as it was corrupted, and the fact of having paved the way to a new system of higher education on a very simple principle: no more state universities that have made a living and have ensured funding, no matter what they did, and no more private universities issuing diplomas in return for money. We will have universities funded by the state or by privates, which are non-profit institutions of higher education. This means that contributions by students, both in the former and in the latter, are reinvested in the system. But above all, we will have a competitive system of higher education.
We have started the process of accreditation and ranking of universities by the famous British agency for accreditation and ranking. But right now we are at a point where they must first recover from what they seen here, and then they will arrange the situation and make it readable, according to the legal framework. In many cases this situation is unreadable. You cannot read it. At least, British cannot read it. Albanians were taught for years to read it as a fantastic situation, where we left behind Great Britain, by having eight times more universities per 1 million of inhabitants, and we totally destroyed Germany with 15 times more universities per 1 million of inhabitants. We did this geometric progression in the growth of higher education institutions by making the system completely unreadable. Those who come here to accredit it cannot read the system. So, it is a process, but the British agency will provide results very soon.
- Sport
You have seen how not only my predecessor, but also others who have never kicked the ball, would wear the shirt of the national team to get some benefit from any of the national victories, or would post orgasmic statues on some gold medals. They left us 120 thousand Euros of debt. This money was meant to be given as reward to athletes with whom they would show off. But actually, they would suck the blood of their victory, and then wouldn’t care less about them. We have paid every cent of this debt. Our champions have received what the government owed them.
In addition, we have allocated another 100 thousand Euros.
This government has invested in the sport infrastructure approximately 25 million Euros, more than all governments taken together in the years after the 1991. Not to mention the two new stadiums of Elbasan and Shkodra where work still continues.
We strongly believe that there is still much to do for sports, and especially for sports in schools for which we will cooperate very strongly with the new local government. This is directly linked with health. It is a well-known axiom that one Euro invested in sports means three Euros saved in healthcare. I believe that we will not see its immediate results, but in the future these 25 million Euros invested in sports will become 75 million Euros saved in healthcare.
- Health
Today, citizens pay 30% less for medicines. In addition, over 150 thousand citizens have access to 85 new reimbursable medicines. This means that they have saved 70 million dollars. Today, every Albanian citizen aged 40-65 has access to free checkup.
I won’t dwell on everything that has been done, and I am aware that there is still a lot to do in healthcare. Nevertheless, I would invite you to keep track of the fact that today we have 22 health centers, with doctors and nurses, providing 24/7 service during the tourist season. Today, emergency cases of regional hospitals are solved through telemedicine consultations, and patients of 11 regional hospitals and 5 university hospitals in the country are not forced to come to Tirana with their families and relatives. In addition to saving time, money and energy, through telemedicine they have direct consultation they would have in Tirana. I would be very happy if you monitored this with your cameras, in all hospitals, including municipal hospitals of Tropoje and Saranda for all emergency cases.
You must remember how some would act on breast cancer awareness day. Everybody would talk about the importance of woman’s breast, but nobody would do anything about it. Actually, we have done nothing strange, except for providing free breast examination to all women. Approximately 30 women are examined every day, because as those who used to occupy the breast’ platforms on breast cancer awareness day have taught us, prevention is the golden key to treating this plague.
I want to emphasize that the government decided yesterday, and this is very important, to provide an additional reward of 100 thousand ALL per month to each doctor who decides to exercise their profession away from home, because we have a big problem: we lack doctors in many areas, and in regional hospitals there is even a shortage of specialists. All those who are willing to take on their task away from home will receive every month an additional 100 thousand All – not old, just to be clear on this.
- Modernization of services
I won’t dwell on public services, but I will just give you a figure. There are 60 thousand transactions per month concerning payment via mobile with an intent to shorten and simplify procedures for citizens.
As far as services are concerned, we are continuing intensively to establish relations between citizens and the state through the one-stop-shop portal. This portal provides today 98 services with a thorough procedure, among which payment of energy bills and traffic ticket, and 59 incomplete online application services. Our aim is to reach what is called level four, where not just applications but services are completed online. Including the digital signing of the documents, we have increased by 300% the number of certificates that are generated by electronic signature.
Yesterday we decided the launch of digital consulates, which will solve a major problem for Albanians living abroad. The most problematic services creating significant costs and forcing people to go to the only consulate with a radius of hundreds of kilometers will be conducted online. The project has been approved and next year immigrants living in countries that recognize the production of documents in their own land – not every country recognizes this, and we are working also with other countries – will have access to the digital consulate and receive full service.
Coming back to liabilities, we have freed from the clutches of the definitive devastation the towns of Gjirokaster and Berat, besides preventing them from being part of the world heritage black list. In addition, Albania and Kosovo have a unified cultural calendar. I won’t list what we have done regarding the restoration of historic centers, but I will emphasize that we will be the government to mark the highest number of investments in sport and culture compared to all previous governments taken together. We will invest on the revival of the Opera and Ballet Theatre; we will invest on the revival of the theater “Migjeni”; on the revival of the theater “Çajupi” in Korca, and of the new stage of the National Theatre. The first three are in process, while for the last one the project is about to be completed. Meanwhile, we have opened the Archaeological Museum in Durres, which remained closed for many years, and soon we will open the museum “Marubi” in Shkodra, the new Museum of Medieval Art in Korca and will continue to fanatically protect our cultural monuments. I’m not counting here all small interventions that we have made.
I do not think it’s worth dwelling on the energy sector, but I just want to say that we have achieved a positive record level of losses, we have approached 30%, some 30 points. We must bow with the greatest respect to the citizens of this country, all those who supported the reform and continue supporting it, and those who have become the contributors of this great success, which is the success of Albania.
Now it’s up to the state to guarantee a quality service, which is still far from being such. We will continue to invest in terms of providing energy quality service. Meanwhile, we are investing in a number of major projects. I’m not mentioning all of them, but let me tell you that the interconnection line between Albania and Kosovo, which was blocked for the shame of those who blocked it, will be completed in April 2016. Meanwhile, work will start for the interconnection line of Albania with Macedonia, thanks to the financial support we have received from the Berlin Process.
We will close the famous southern ring, so that we can really talk about tourism and tourist development in all of southern Albania pearls. We will continue with the construction of new substations in Tirana, in addition to freeing the small ring of Tirana and the promenade of the square “Skanderbeg”, in order to be like all normal capitals which have squares. We will build another substation, so that energy security of the capital city will pass to a new stage. I’m not dwelling on the new energy policy, but I just want to point out that thanks to the leadership of the Minister of Energy, historical reforms have been done in this period not only for distribution, but for the whole sector which has entered a completely new era.
In relation to the hydrocarbon sector, I will not talk about the growth of oil production and other things, but I will only say that, for the first time in its democratic history, Albetrol has started contributing with income to the budget, which had become a black pit from where nothing would ever come out, even for the state. On the other hand, we are about to start negotiations for opening a series of new major strategic investments in the field of oil exploration. You’ve made public that some of the biggest companies have stepped up. Meanwhile, the story of oil robbery and contracts with fictitious companies, as it used to happen in the past, is over.
In the mining sector, although we have revoked 200 mining permits that didn’t meet legal requirements, versus the 9 permits revoked in 2013; although we have less accidents in areas where the activity is performed; although we have rehabilitated 119 abandoned galleries, have closed and continue to close other galleries, we are still in the conditions where we need to take a drastic measure, it will be taken in September, to stop any exploration in the danger zone and to put an end to deaths as a result of the barbaric exploitations of our underground asset.
Meanwhile, in order to not be a country that only extracts raw material and exports it overseas, but also a country that has its own processing industry, a number of plants have been opened or are about to be opened.
Last but not least,
- Crime and security
I’ll give you just one figure: 50% less murders in the first half of 2015 compared to any other year since 1992. I believe it is a very significant figure. Meanwhile, in the second 300 days, compared with the first 300, we have had 53% less armed robberies, 16% less theft with violence, 33% less destruction of property by explosives, and Albania is not any more a country of origin for the cultivation of drug.
Albania was a country of origin, as it was in the list of countries under surveillance, the blackest list of human trafficking. Of course, there is still much to do in both aspects, but these I mentioned are the ones that we have achieved within a very short period, compared with the large volume of problems inherited for many years.
Thank you for the patience!
Hello Mr. Prime Minister! My first question is whether the government cabinet will be refreshed in the next 300 days, a process that occurs in every European government. My second question is about taxes. Recently, we have reported that the tax agency in Vlora has imposed fines of approximately 100 million ALL for tax evasion, but we are seeing that in the south of the country people still do not issue receipts. Is there a government plan to deal with tax evasion?
Thanks! The cabinet will be refreshed during the August break. Each of the members of the government will go and get refreshed on vacation, and the government will be back at work as it is now. We have no plans to make changes in government, we see no reasons for this.
Meanwhile, in September, we will begin another major operation, which by its nature and aggressiveness will be similar to the operations made for energy, the territory and the closing down of universities.
It will be an operation against informality, and it will be a complex one. At the opening of the next session, the Parliament will discuss the package for aggravating criminal measures against tax evasion, smuggling, and slavery of illegal work. They will be measures against all those activities that have made of Albania a country where still today there are some businesses, whether large or small, that pay regularly their obligations but who are unfairly crushed by a major pressure, because the administration tries quite rightly to generate income – there is everywhere room for improvement, even in business – while some others don’t even bother to be provided with cashboxes or registers. This operation will include Customs, Taxes, the Labor Inspectorate and, obviously, the State Police. There will be zero tolerance, and measures will be very severe. Those who don’t have cashboxes will be severely punished. Fiscal evasion will be considered a criminal offence, and all these offences will be part of the criminal offences package. Some of them are already in, but measures will be significantly tightened.
Fight against informality will the priority of the next 300 days, since we are dividing our work into periods of 300 days. It will be our priority, because we want to reduce taxes. And in order to do this, we need first of all to ensure that the number of taxpayers will increase significantly and everybody will pay their dues. Then, we will reduce taxes for all. This is the goal. I am convinced that we will succeed.
In the next session, we will carry out in parallel the great national water reform, because we are now in a situation where we need to establish a completely new relationship with the 61 new municipalities in the country, and a new system of water supply management. It will be an-eye for-an-eye-and-a-tooth-for-a-tooth fight against informality.
My question has to do with decriminalization, a very important and controversial issue. Actually, the international community, not just names in politics, but also the United States have prompted you to make a political purge. Will there be in September a cleaning of political parties, namely, of your party?
Firstly, I see no hygienic problems in the Socialist Party, of any kind. Second, let me tell you that our duty is to do things, while others have nothing to do but talk. We will extend the issue of criminal records in politics also in the administration, and will deal with it legally. We have worked on what we committed, and in the next session the question will be whether we will dealt with it as integral part of justice reform, or a law on its own, but this is a technical issue. We will pass the law in order to deter all those with criminal records that have been tried and not presumed, from having political activity or being involved in public administration, by periods, types of crimes, etc.
We are not ready, I have never been ready and I’m not either for a witch hunt – you know who hunts witches, the club of hunters left by the regime of Enver Hoxha and recycled in the Democratic Party – or for an Albanian invention.
Fortunately there are models. We take as reference the Italian model. It is a model that has very reasonable points to act, and we will act on that model. We will strengthen the Italian model, which does not extend fully to parliamentarians, but we will fully extend to parliamentarians.
We don’t have to dwell on this history any more. Those living in Albania know very well that this story did not start in 2013, but it is the result of a political escalation which, for many reasons, has involved people who have had many problems in the past, and this escalation has occurred during the years. The important thing is for us to address it legally. It is important that we don’t do things as banal from the constitutional standpoint, as ridiculous from the political standpoint. Because, what the Democratic Party keeps on doing is as banal from the constitutional standpoint, as ridiculous from the political standpoint, in this aspect.
In relation to what you just explained, the US embassy said very clearly that it is a shame that the Albanian politics have MPs incriminated in trafficking. You haven’t expressed a view on this matter, but you just said institutionally what you will do. I believe you already have the name of the MP. Do you have any comment?
What comment do you expect from me? In the current legal and constitutional conditions, there isn’t in the Albanian Parliament people who don’t have trouble with the law. I’m not talking about those who have had problems with the law recently; I am talking about those who have become members of parliament; people who have had evident problems with the law have not entered the parliament. I believe I have been the first to ask for criminal evidence of every new MP. Criminal evidence is the only official document in the Republic of Albania to determine whether a person has criminal records, and nobody has a criminal record. Trials occurred in a distant or even recent past, but that are beyond the limit of criminal record, cannot be addressed with a witch hunt, but with the law, provided that we want to address them. And we will address them with the law. This means, of course, dealing with an unpleasant phenomenon. But this sort of wars that resemble very much inquisitional forms are to me unacceptable. They are totally unacceptable.
Here politics deal with phenomena and addresses the phenomena. That’s what politics for. Politics do not undertake to consume people, but undertake to address phenomena. When the phenomenon is addressed properly, all those involved in that context have their limitation. In fact, persons who have been convicted and who have served their sentence in terms of the Constitution and the law in Albania – and to my knowledge, in all European countries – even Italy has not implemented this law yet, there is a huge debate and decision on the constitutionality of the Constitutional Court is expected to be taken – are people who have the right to elect and be elected. Aren’t’ they?
Given our conditions, the phenomenon requires management. We have said since the very beginning that even if the DP had had will and a vision – but they cannot find a vision because it is not contagious – we could have done the law a long time ago. We waited for their proposals, but we got instead some shreds where it was said that those willing to run had to “leave” their fingers to the CEC for fingerprinting, as if the CEC were I don’t know what sort of agency. We could not go after those shreds, and now we will bring the draft and will approve it with them or without them.
We will end this debate and avoid the phenomenon for the future. This phenomenon will be already dealt with in view of future elections, but meanwhile our goal is to extend it to the public administration. You’ve heard some say that this one has been convicted, this other has not been convicted. Criminal evidence says no, but for certain functions in the administration we should go beyond criminal evidence, and not allow people who might be convicted of corruption to come back in the administration and be directors. This is the approach.
As far as local elections are concerned, I am telling you once again that we have not accepted anyone with criminal records. I am repeating that I consider criminal records those who have been tried even in the first instance. Then, doubts, detention, processing, investigation, these are part of the processes that have no value in terms of judgment. When you tell me about a person that has been tried, even in the first instance, and who has run for or won municipalities, then I will make a public apology. The comparison “we removed them but they didn’t remove them” does not stand, because they removed people who had the gavel and lived abroad, and people who were banned from circulating in the European Union.
Mr. Prime Minister, I want to ask you about a goal that you mentioned at the Harvard University conference regarding tax cuts, which you say that you intend to realize after the action that can be similar to that of energy. Do you have any plan for the escalation of VAT?
No, we don’t.
In what does the tax cut consist, and do you think people can be rewarded, even with the reduction in VAT on energy!
I continue maintaining the same commitment. Yes, VAT of electricity for households is a commitment that we will keep, but we will keep it when the system is fully stabilized, and we are on this track. As for those who wanted us to do 6% VAT for families, as we promised on the first day, my question is: to whom do this 6% VAT? To those 320 thousand customers who were not even registered? Or to the others who would of course pay, but then we had to leave everybody without electricity, have an electricity collapse across Albania! And secondly, we will drastically reduce VAT in tourism, but we don’t intend to make a VAT escalation as a mechanism, so my answer is no.
Regarding tax cuts, first, we believe that taxes are not high. This is our conviction.
Secondly, we believe that there is room for tax cuts, provided that the base is significantly expanded. For this reason, my message to all those who continue to do business without paying taxes is:
Enjoy your vacations and prepare for September. In September you should know that you can no longer receive services from the state with the money of those paying.
Measures will be drastic. For example, those who are found without cashbox will first have their goods seized, and if they repeat the offence, they will physically follow their goods in court for prosecution. There is no other way.
Mr. Prime Minister, have you planned to visit Greece within the year, and will the Greek Prime Minister visit Albania within a year, as has it been talked about? What will happen to the Sea Treaty, and is there a loss for the Albanian state given that it cannot do sea research after an agreement on the sea was not reached?
I have invited the Prime Minister of Greece, and he is welcomed at any appropriate time for him. I have no plans to visit Greece this year. On the other hand, it is certainly not a loss that we cannot do research in that area, because it is a disputed area, which in our view belongs to the territorial waters of the Republic of Albania, but I do not believe that we should give away that part of our territory because of research. We will do research there, only after it will be clear to whom that territory belongs. That territory belongs to Albania. We have agreed with the Greek part that if we do not find a common language with the negotiations, it will be decided by a third party in the arbitration, or a third party on which both parties will agree.
Mr. Prime Minister, I would like to ask you about a possible stalemate concerning the Special Court, following that of the last year after the general elections. How do you comment on the polarizing debate, and what consequences may this situation bring? Secondly, do you think Albania’s safety is endangered after the threatening voices of some ISIS representatives, while some political center in the Balkans accuse Albanians of being such elements?
I believe that the second question needs no comment, because if Norwegians, the Danes and the English became warriors of the barbaric cause, it would be impossible for Albanians to not be affected. But those saying that Albanians are a problem have a problem with themselves and with the Albanians.
Concerning the first part, it is the will of the Assembly of Kosovo, and I am confident that the Assembly of Kosovo will take the best decision.
When did work on judicial reform start? At what extent is the majority ready to intervene for restructuring, even for constitutional changes regarding institutions such as HJC or the Public Prosecutor’s office?
Justice reform is built on a principle. It will be done by experts and will be voted by the Assembly. It will not be made by politics, and will not be a reform of political negotiations. It will be done by experts. Experts have worked, an analysis and a strategy have been made, and we will give the draft package coming from experts all the political will by means of vote.
You gave earlier a positive overview of the economic situation in the country, but how come there are some Socialist MPs like Mr. Blushi who do not look at it the same way? According to him, poverty in the country has increased and the Renaissance project in the country is already dead.
Secondly, how are yours and SP’s relations with SMI and Mr. Meta, given the recent allusions about a cold climate in the alliance?
I believe that you hold the thermometer because of your job. I have no thermometer for relationships.
If there were a Socialist party where everybody looked at things the same way, it would be the Socialist Party any longer. It would be called the Democratic Party of Albania.
Mr. Prime Minister, you talked about a satisfactory economic growth, but nevertheless a few weeks ago the IMF and also your Minister of Finance said that the economic growth for 2015 is expected to decrease. Exports and imports in the first half of this year have also decreased. How do you see this fact, is there room for such optimism?
I talked about exports in agriculture and manufacturing, which are the two sectors where we have invested more political and financial capital. Not only they have not decreased, but they have increased twice in some regions of the country, like for example exports in agriculture.
In terms of economic growth, there has been a normal and legitimate concern that the Greek crisis could impose revision of targets. The fact is that the first quarter has given us 2.82%, a figure that was surprising for us. We will see the second quarter, which is also directly related to the Greek crisis, but for the moment there is no reason to be pessimistic. I never use the word “satisfactory”. I’m generally a dissatisfied person, with myself, with you, with your bosses, with everyone.
I said that economy is far from being in decline or deterioration. It has given significant and encouraging signs of growth on the path laid out. But from this to satisfactory there is a very big distance. It will never be satisfactory for me, but in order to have a satisfactory growth for Albania and for the people, a lot of work must be done and a lot of time has to pass. This will start when we start to get the real results of all the reforms that we are doing, particularly in the next mandate. While this term, our aim is to achieve the growth targets we have set, and it is a real increase compared with the decline and negativity that we had up to 2013. This is a fact! Increased consumption, for us, is the most essential thing. As long as we have consumption growth, we have also strong reasons to believe that the policies are right, it is the right way. Of course, these two are not enough for us to say that we have reached the destination, but they are means of transport that take as to the destination.
Mr. Prime Minister, you said that some tests are being carried out in terms of income, and necessary measures will be taken after these tests. Are budgetary changes part of these measures?
Of course, there is a first thing to determine. If decrease is only a result of restructuring and conjunctures, let’s say oil on the one side, while as for cigarettes we all know that large stocks were created before the new excise was adopted, because large amounts were introduced to avoid new taxation etc., if these are the dominant measures, it means that the decline is temporary and will have a reset, including the new methodology based on which companies to do take debts anymore to realize the plan. If there are other elements, which are not excluded and which risk to make the problem more chronic, then of course we will definitely take new measures.
For the curiosity of all those who are flowing this conference, where will you spend your holidays?
I am forced to follow my little boy, and my little boy cannot not go anywhere else but near Vuno. So thank you very much, and I wish everybody enjoy your holidays. Please, convey my best wishes to your bosses, and wish for yourselves that they will come back from vacations with a cooler mind.
Thank you!
