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WB calls for debt transparency: Albania to publish details of every loan

Politiko 2025-07-04 11:50:05

WB calls for debt transparency: Albania to publish details of every loan

The World Bank recommended radical measures and reforms to further improve transparency for the sovereign debts of countries around the world.

In the "Radical Debt Transparency" report recently published by the World Bank, upper-middle-income developing countries, including Albania, lack transparency in some segments of borrowing.

For these countries, including Albania, the report recommends a series of concrete reforms to strengthen transparency and prevent the creation of hidden or mismanaged debt. The group of countries that Albania is part of should adopt legislation that mandates detailed disclosure of loans, including contract terms and collateral.

It is required to more clearly define the definition of public debt in accordance with international standards (including public enterprise obligations and guarantees), while the use of confidentiality clauses should be limited and the signing of agreements that require total secrecy should be prohibited.

Public debt should include liabilities of state-owned enterprises, borrowings of local authorities, contingent liabilities (guarantees, PPPs, etc.).

For countries like Albania, it is required to increase the role of the Parliament and the Supreme State Audit Office in reviewing the debt strategy, approving new loans, and auditing existing contracts.

Regular audits by independent institutions are also suggested for high-risk loans (e.g., those related to natural resources or large infrastructure projects).

If a loan restructuring occurs, our country should publish the new agreed terms and avoid selective agreements.

The group of countries to which Albania belongs is required to publish a structured loan-by-loan format of each new debt agreement, with key financial terms.

It is also recommended to create an official portal on public debt where key contracts, regular analytical reports, and borrowing planning and risk assessment are published.

In 2024, public debt reached 54.74% of GDP, a decrease of 2.7 points compared to 2023. This was the lowest level of public debt in relation to GDP since 2008. The decrease in debt last year did not come due to a planned program, but from the failure to realize budget expenditures according to plan. The inability to spend led to a forced fiscal consolidation. But in the meantime, a series of liabilities from public enterprises and others are not included in the official public debt indicators./ Monitor

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