Representatives from 27 countries and 12 international organizations met in Brussels on March 1, 2001, to review achievements by the Albanian Government in attaining macroeconomic stability and advancing structural and institutional reforms. This meeting was not a pledging occasion. It allowed the Albanian Government and donors to discuss how the international community is supporting the Albanian reform process.

The meeting was co-chaired by Ms. Catherine Day, Deputy Director General, European Commission, and Mr. Christiaan J. Poortman, Director, World Bank. The Albanian delegation consisted of Mr. Paskal Milo, Minister of Foreign Affairs, Mr. Anastas Angjeli, Minister of Finance and Mr. Engjell Skreli, Deputy Minister, Ministry of Economic Co-operation and Trade.

Ambassador Ahrens, the OSCE Representative in Albania and local Chairman of the Friends of Albania Group, updated donors on recent political developments. He noted progress in the electoral process, as evidenced by the October 2000 local elections, but cautioned that further improvements in the electoral process are needed to ensure free and fair Parliamentary elections in June 2001.

Donors were briefed on Albania’s performance in implementing its economic and structural reform program. In particular, donors expressed their satisfaction with the way in which Albania had put the crises of 1997 and 1999 (Kosovo) behind it. The IMF representative commended the authorities for implementing policies aimed at maintaining macroeconomic stability, resulting in favorable growth performance, and was supportive of Albania’s progress in improving revenue performance and in implementing a transparent process for privatization. However, the IMF representative noted that further economic progress is at risk unless there is a turn-around in the performance of the electricity sector, and emphasized that additional budgetary support for this sector in 2001 should be reviewed in the overall context of the budget, and would hinge on demonstrated progress in implementing the Government’s electricity reform strategy. Several other donors also expressed concern about the electricity situation and called for Government’s continued commitment to tackle critical issues facing the sector.

The European Commission’s Delegation briefed participants on the Stabilization and Association Process in Albania. The Commission welcomed the recent efforts made by Albania to reform the Albanian Customs Administration Commission and to develop a legislative framework in line with EU standards. The Commission noted, however, that considerable efforts are still needed. It stressed the importance for Albania to continue to address its structural weaknesses, to enhance governance and rule of law as well as to improve the overall functioning of public administration, including the judicial system. The Commission also underlined the importance of implementation and enforcement of the existing legislative framework.

The authorities briefed participants on the consultative process for preparing the Growth and Poverty Reduction Strategy (GPRS), involving representatives from civil society, private businesses, local governments and the donor community. The Albanian Delegation reaffirmed the Government’s commitment to produce a full GPRS by mid-2001, and emphasized that the GPRS is in full harmony with the Stabilization and Association Process. Several participants expressed appreciation for the participatory process adopted by the Government to prepare the GPRS.

The Albanian Delegation further briefed donors on its recent initiative to strengthen the budget planning process and achieve a more strategic focus and effective use of public resources through the introduction of a Medium-Term Expenditure Framework (MTEF). Participants welcomed the initiative and encouraged Government’s efforts towards a more strategic prioritization of public expenditures and increased transparency in the use of budget funds.