PowerPoint Presentation

Sustainable developmentSustainable Development GoalsCreating Awareness Among Students-The Case of Albania

Prepared by:Anisa VrenoziDecember 2015Tirana, Albania

Aim of Sustainable Development

Sustainable DevelopmentNormative Definition:Development that meets the needs and aspirations of the current generation without compromising the ability to meet those of future generations.

In-Contest of Albania Definition:Development which enables individuals and communities in developing regions of the world to raise living standards through profitable products, consistent with minimizing adverse environmental effects.

AlbaniaUpper middle income cluster with a GNI per capital of $4,460in 2014

Weak institutional capacity

High vulnerability in different sectors such as energy, agriculture, climate, etc.

Albania - StatisticsUnits2013GeographySurface areathousand sq. km 28.75 PopulationPopulation, ages 15-64in thousands 1,903.90 Population growth% (1.01)Urban population% of total population 55.38 Economic developmentGNI, Atlas methodcurrent USD in millions 13,064.77 GNI per capita, Atlas methodcurrent USD 4,710.00 GNI per capita, PPPcurrent international $ 10,400.00 GDP growth% 1.42 GDP per capita growth% 2.44 PovertyInfant mortality rateper 1,000 live births 13.30

Data was retrieved from: http://www.aidflows.org/

Official Development AidThe amount of ODA amounts received and current sources and uses of ODA for Albania are presented as follows:

Net ODA Disbursements by year in US $ millionYearNet ODA DisbursementsIDA Disbursements2003 482 79 2004 371 78 2005 383 35 2006 376 47 2007 327 46 2008 361 20 2009 363 27 2010 379 16 2011 372 12 2012 362 14 2013 269 (5)Total 4,045 370

Data was retrieved from: http://www.aidflows.org/

WORLD BANKGross CommitmentsYearIFCIBRDMIGATFs200981.78302.1420102.28001.5220110.42524.983.422012112.7471.6159.375.93201361.864009.82201445.18305.302.8820150.4516007.96Total304.61684.9184.3533.67

Data was retrieved from: http://www.aidflows.org/

Sectors FinancingODA, 2014

Sectors FinancingWorld Bank, 2015

Allocation among SectorsThe allocation of resources should be done based on the current availability of resources of the country and the current development needs. High concentration of investment in Public & Administrative Law and the Economic/Finance sector.This distribution is quite logical considering the current situation of Albania as a country requiring immediate improvement in the legal framework and infrastructure in order to attract private investors and FDI.

More to be done.Despite the relative high life expectancy (77.16 years) and the high adult literacy (96.85%), Education & Health system should be considered with high priority considering:Immediate need for improved health system, especially in the perspective of further decreasing the current rate of infant mortality (14.2Need for specialized labor force, especially trained through vocational and professional training which is currently at very low levels.

Millennium Development GoalsUnits2013Goal 1: Halve the rates for extreme poverty and malnutritionPoverty headcount ratio at $1.25 a dayPPP, % of populationn/aPoverty headcount ratio at national poverty line% of populationn/aShare of income or consumption to the poorest quintile%n/aPrevalence of malnutrition% of children under 5n/aGoal 2: Ensure that children are able to complete primary schoolingPrimary school enrollment% netn/aPrimary completion rate% of relevant age groupn/aSecondary school enrollment% grossn/aYouth literacy rate% of people ages 15-24n/aGoal 3: Eliminate gender disparity in education and empower womenRatio of girls to boys in primary and secondary education (%)%n/aWomen employed in the nonagricultural sector% of nonagricultural employmentn/aProportion of seats held by women in national parliament (%)%17.9Goal 4: Reduce under-5 mortality by two thirdsUnder-5 mortality rateper 1,00014.9Infant mortality rateper 1,000 live births13.3Measles immunization (proportion of one-year olds immunized, %)%99

Millennium Development GoalsGoal 5: Reduce maternal mortality by three-fourthsMaternal mortality ratiomodeled estimate, per 100,000 live births21Births attended by skilled health staff% of totaln/aContraceptive prevalence% of women ages 15-49n/aGoal 6: Halt and begin to reverse the spread of HIV/AIDS and other major diseasesPrevalence of HIV, total% of population ages 15-490.1Incidence of tuberculosisper 100,000 people18Tuberculosis case detection rate (all forms)81Goal 7: Halve the proportion of people without sustainable access to basic needAccess to improved water source% of populationn/aAccess to improved sanitation facilities% of populationn/aForest area% of land arean/aTerrestrial protected areas% of total surface arean/aCO2 emissionsmetric tons per capitan/aGDP per unit of energy useconstant 2005 PPP $ per kg of oil equivalentn/aGoal 8: Develop a global partnership for developmentTelephone mainlinesper 100 people8.86Mobile phone subscriptionsper 100 people116.16Personal computersper 100 peoplen/aInternet usersper 100 people60.1

2016-2030

Domestic Mobilization of ResourcesFocus more in its Domestic Mobilization of Resources. European Commission in its report regarding the economies of the Balkan region has stated that the Tax revenue to GDP ratio in Albania is 27.8% in 2015. The same level is expected in the upcoming year, with a modest expected increase to 27.9% in 2017.

In the meantime, as stated in the same report, the countries of the region have higher Tax-GDP ratios with FYROM -31.6%, Montenegro-42.9%, Serbia-40.3%, Bosnia-Hercegovina-38.9%, leaving behind only Kosovo with the ratio of 26.8%.

Although the situation has been improving during the last decade, some of the main reasons for this situation as presented in the Doing Business in Albania report are as follows: a) Tax bases are mainly limited by the size and persistence if the informal sector with much of the countrys GDP out of the formal framework, b) Persistent corruption and lack of transparency which inhibit the citizens not to comply with laws and,c) lack of accountability to taxpayers on how money is spent which requires a higher oversight from the civil society on the parliamentarians.

DMR ~ Tax Revenues

Taxes~ What has been doneAlbania, as a transitional country in the 1990s, has been able to improve the previous erroneous tax system forwarded from the centralized economic system of the dictatorship.

Considerable improvement in the facilitation of compliance by providing a clear tax regulatory and legal framework, identifying all the taxpayers, collecting the taxes and providing adequate taxpayer services.

Taxes~More to be doneMore focus should be dedicated in enforcing compliance so nonpayment of taxes does not become a cheap source of finance and also an adequate penalty structure should be enforced for non-paying subjects.

More efforts should be done in improving governance and assure the honesty of the tax collectors.

Taxes ~ Sustainable ReformsTherefore, we may state that since Tax Policy in Albania is already established, more efforts should be dedicated in improving Tax Administration. The improvement of this situation can be achieved by :Eliminating unproductive activities,Focusing more efforts to larger business taxpayers and Implementing a modern IT infrastructure to facilitate tax collection, internal management & control of the system, audit selection system, legal structure & procedures and provide for lower compliance costs.

This would not only increase tax collections but also would aid in tackling illicit financial flows.

DMR ~ The Private SectorThe private sector plays a pivotal role in development financing since it underpins economic growth, know-how, technology transfer, and job creation and productivity gains. In this perspective, to increase private investment, both national and international, the Government should decrease the perceived risk associated with the investment in Albania or increase the anticipated returns to compensate for high risk expectations. This positive investment climate can be achieved through supportive governance structures, competition policy, hard & soft infrastructure and instruments that provided sustainable markets.

DMR ~ Capital MarketsIn addition, it would be very effective to work on developing a capital market with a variety of financial institutions apart from banks, which actually compromise 98% of the countrys financial system.

More attention should also be provided in establishing more pension funds and developing the existing ones (2 modest pension funds)

Pension Funds may highly contribute in the private sector investments in those fields that require higher rates of investments and provide also higher future returns, such as infrastructure.

How to Mobilize ODA?Multilateral and bilateral donors channel ODA funds in order to promote both stronger DRM and more transparent, tax-payer friendly environment by providing technical assistance, capacity-building and commodities, especially in the areas of tax administration and illicit flows administration.

In addition, they can bring in global experience in measuring the DRM gaps and results.

Countrys leadership demonstrates the political will to implement the necessary institutional and tax policy reforms.

Albanias Development FinanceMix of development finance based on its economy indicators

According to World Bank, Albania is classified in the Upper middle income cluster with a GNI per capital of $4,460in 2014, with weak institutional capacity and with high vulnerability in different sectors such as energy, agriculture, climate, etc.

Considering this situation, the countrys development priorities should be financed with a mixture of concessional and non-concessional loans when the investment can potentially generate an economic return.

Investment in InfrastructureImmediate need to invest in INFRASTRUCTUREConsistency on a cross party, cross-government basis to make investment in infrastructure account and deliver the outcomes aimed forCompetitive pressure: defend and to protect the user and the tax payer in terms of ensuring that infrastructure is efficiently deliveredManage the individual risks and to mitigate them, and then to allocate those risks to those parties that can manage, bear, and mitigate those risks bestAffordability: Avoid Vanity ProjectsImprovement in the legal system

Conclusions.In conclusion we may state that the distribution of ODA in Albania is quite accurate considering the current situation of the country and further investments should be dedicated to the sectors of Health & Education. Focus more in further improving its Domestic Mobilization of resources and further develop and enhance new ways of financing development-private & public.

Albania ~ The Financing Role of the Multilateral Development BanksLeverage and multiplying and mobilizing resources across the development landscape for greater impact.Investments are in roads, they're in energy, they're in health systems, they're in education, in agriculture, and climate-smart technology and water and cities

IBRD serves primarily middle-income developing countries and it helps them invest in their major development needs by giving them loans and also advice and guidance and advisory services.IFC provides advisory services for the Government and it works in the private sector with loans and equity grants and other investments.

References:

AIDFLOWS: http://www.aidflows.org/EU Commission: http://ec.europa.eu/index_en.htmWorld Bank: http://data.worldbank.org/country/albaniaDoing Business Albania: http://www.doingbusiness.org/data/exploreeconomies/albania/INSTAT-Institute of Statistics Albania: http://www.instat.gov.al/Ministry of Finance, Albania: http://www.financa.gov.al/Bank of Albania: https://www.bankofalbania.org/Coursera: https://www.coursera.org/

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