The Financial System and Its Impact on the Albanian Economy

Abstract

This is a problem-related analytical article whose aim is to offer an in-depth description and exploration of the shortcomings of the Albanian financial system. Its analysis focuses on pinpointing the incompetent measures and misjudged fiscal and monetary policies applied by the government and its main financial supervisory body, the Albanian Central Bank, in order to establish and administer and adequate market economy’s financial system for the country, since the fall of the single-party system 24 years ago. Furthermore, it explores various fiscal and monetary standards that should have been considered, and need to currently be put to practice, in order to avoid deeper financial disappointments in the face of a seven-year-long financial crisis that continues to sway over Southern Europe. Finally, it draws several conclusions on what the country’s fiscal and monetary approaches should be in the near and mid-term future in order to start building a solid financial system, which rigorously reflects Albania’s economic potential, deficiencies and particularities as a small developing country in Europe.

DOI: 10.5901/mjss.2015.v6n6p291