BB: Economic growth in Albania is not reflected as well-being. Poverty, double the region

2023-08-03 07:54:41Biznes SHKRUAR NGA REDAKSIA VOX

Despite the country's economic growth over the years, the latter is not reflected in the well-being of the poor population. This is a conclusion of the World Bank in a recent report that analyzes the impacts of the modernization project of social assistance which has been implemented with its support for several years by the government.

Specifically, in the last part of the analysis, the bank focuses on the general trend of poverty.

"The poverty rate in Albania has remained stubbornly high, despite periods of economic growth, even compared to other countries in the region. With a rate of about 29.3 percent of the population estimated in 2022, Albania's absolute poverty rate (measured at US$5.5 per person per day in purchasing power parity [PPP]) is currently almost double the rates of other countries in the Balkans Western countries for which there are comparable recent data that assess poverty. The poverty rate appears to have decreased significantly between 2016 and 2018, but then the November 2019 earthquake, followed by the COVID?19 pandemic, first reversed the trend and then slowed the rate of poverty reduction.

In another point, the bank estimates that Albania is relatively better in terms of the rate of those at risk of falling into poverty calculated by Eurostat in the Western Balkans, but still, it has a higher rate than the EU average.

"Eurostat estimates the relative poverty rate, or poverty risk rate, as the percentage of people with an income of less than 60 percent of the equivalent national average income. In Albania, EU?SILC results for 2019 show that around 659,000 individuals (23 percent of the total), or nearly 173,421 families, live below the poverty risk threshold.

This percentage is comparable to other countries in the region. However, the relative poverty rate is still higher than the EU average of 16.5 percent in the same year," the Bank estimates.

Regarding the social assistance modernization project, where an important element according to the bank is economic assistance and the establishment of the scoring system that changed the old approach, the impacts have been positive in poverty alleviation. The project became effective in 2012 and was expected to close in 2017, but in fact after a review it was postponed to December 31, 2022. The bank offered a financing of about 60 million USD./ monitor