The Socialists present the alternative version OF THE DRAFT BUDGET

Socialists present the alternative version OF THE DRAFT BUDGET The draft budget for 1995 has arrived in Parliament after a long wait, also crossing the limits. After being discussed, not without difficulty, in the parliamentary committees, it is now on the desks of the deputies, who have begun their discussion. The first to defend the draft state budget was Prime Minister Meksi himself, before an almost full attendance of deputies, although this was not maintained until the end of the day. For around 20 minutes, Mr. Meksi presented the implementation of the 1994 budget and, alongside it, the main objectives contained in the 1995 draft budget, which is generally characterized by important alternatives for the country’s future. Following him, and without emerging from the shadow of the previous speaker, another government representative, Deputy Prime Minister and Minister of Finance Mr. Vrioni, tried to give the draft budget for this year a more concrete form, then yielding the floor to the third government representative, Mr. Çeku, the deputy minister and deputy prime minister, to answer questions raised by the deputies; after a numerical simplification, quite a few of them also considered his task completed. The united front of government speakers—the Prime Minister, Deputy Prime Minister and deputy minister—was somewhat disrupted by the left-wing contributions of deputies from all the parliamentary political forces, who pointed out numerous shortcomings in the draft budget submitted for parliamentary approval. On behalf of the Economy and Finance Committee, its deputy chair, Socialist deputy Anastas Angjeli, presented the options. Deputy Leontej Çuçi said, among other things, that the economic indicators point to the depths of the country’s economic crisis. “In fact,” he said, “we do not understand whether the 7 percent growth in GDP is demagoguery or real growth.” Speaking about investments, Mr. Çuçi said it was unfortunate that of the 600 million dollars entering our country through emigration, the money is turned into food products and kiosks rather than productive investment. He called this a weak draft. (Continued on page 4)

— Speech delivered yesterday in the Albanian Parliament on behalf of the Socialist Party parliamentary group by Asst. Prof. Dr. Anastas Angjeli — Honourable deputies! The discussion on approving the draft state budget for 1995, although it has passed every time limit and legal deadline, is one of the most important moments in the country’s economic life during this period of transformation and reform towards a market economy. From the presentation made by Prime Minister Meksi and Deputy Prime Minister and Minister of Finance Vrioni, as well as from the materials submitted to the committees and the group, a rather unclear picture emerges, expressed in monetary figures, of what the Meksi Government has done and will do, and of where the Albanian economy is heading. Thus, in this legal and financial document, so important for the country’s economy, the indicators conceal the success or failure of the economy and the reform; the most fundamental interests of the country’s economy and its people—economic and social, administrative and political, etc.—intersect and intertwine. I believe the most fundamental characteristics that stand out in the drafting and approval process and the contents of the 1995 draft budget are: Strict enforcement of laws and greater transparency The passing of the deadlines for approving the 1995 draft budget, as well as the consideration of a number of laws approved by our Parliament, whose financial effects must be covered by the 1995 budget, show that the Government has been careless in enforcing the laws. (Continued on page 3) Not a budget for growth, but for consolidating the economic crisis

Speech by deputy Shkëlqim Cani I appreciate the work of the team of specialists in drafting this budget proposal, since technically it shows year-on-year growth. And although the budget is a working tool for budgeting, I will set out below some thoughts and suggestions on the 1995 draft budget: First: The excessive delay in submitting the material means that we are discussing and approving, almost entirely, a budget that has already been implemented and a half-draft budget. After around five months of the Government’s lethargic sleep, we deputies were given not even two weeks, and, moreover, answers to all the questions have still not been received, which does not seem fair to me. Second: In Article 6 of the 1994 State Budget Law, the People’s Assembly approved as an integral part the tables specifying expenditure items for each ministry. For 1994, the Government reported (p. 6 of the explanatory statement accompanying the budget) that “public investment policy is based on …”, and the text continues but is cut off. With arguments intended to leave itself room to manoeuvre and the possibility that funds from foreign sources may not be realised, the Government, in Article 7 of the draft budget submitted, asks us for permission to change the allocations for each project by up to 30 percent. The Economy and Finance Committee has reduced this to 20 percent. I think this authority up to 20 percent would be sufficient for the Government. This is all the more so since only nine months remain until the end of the year. It is true that foreign funding depends on donors, but also, to a considerable extent, on the work of our executive branch. More than 10 loan agreements have been submitted for ratification with excessive delay because of negligence and bureaucracy. This restriction, then, would encourage better work by the Government, which, in any case, would have no difficulty appearing before its Parliament to report and justify transfers of funds up to the 5 percent limit. Third: Compared with the end of 1993, … it is projected that by the end of 1995 we will have nominal GDP growth of 75.8 percent, while revenues will grow by only 59.6 percent, or almost the same as inflation growth (56.8). The number of taxes and duties has increased year after year. It is true that there is no direct connection between them and that certain adjustments must also be acknowledged. But, based on the figures above and an analysis of budget revenue items, I believe there is room for improvement, specifically: 1. Turnover tax can be increased from 5,300 million lekë to around 6,600 million lekë; 900 million lekë would come from the delayed implementation of VAT. Another 400 million lekë would come from increased domestic production and services. (Continued on page 4)

Speech by deputy Leontej Çuçi Discussion of the draft state budget is as much a political issue as an economic one. Judging it from a political standpoint and considering this draft budget an implementation of the Meksi Government’s medium-term economic programme, I see no positive grounds for saying a good word in its support. Viewed from an economic perspective, with two or three positive indicators adjusted, the other indicators not only point to a worsening economic crisis, but also to its consolidation. More specifically, the growth of gross domestic product (GDP), the increase in budget revenues, or control of inflation, although they may appear to be positive indicators, in reality express a distorted, temporary, and even catastrophic reality if we continue along this path in the future. It is naïve or demagogic to be satisfied only with 7 percent growth in gross domestic product, or an economic growth rate of 8 percent, when the current state statistics do not provide a reliable figure for the real increase in agricultural production. It is acknowledged that industrial production will continue to fall in 1995. Add to these facts imports around four times greater than exports, and it is not difficult for even the simplest citizen to understand that these indicators do not point to the activation of domestic Albanian production, but to artificial and forced economic growth—indeed, growth driven solely by imports or imports. It is unfortunate that the approximately 600 million dollars that enter Albania on average every year from emigration are spent almost entirely on consumer goods and kiosk construction, and very, very little on ... Secondly: Article 6 of the 1994 State Budget Law provides that the People’s Assembly approved, as an integral part of the law, the tables setting out expenditure items for each ministry. For 1994, the government stated (p. 6 of the explanatory report the assets inherited during the transition, especially the rehabilitation of infrastructure, education, healthcare, the irrigation system, etc.” But what actually happened? Just a few months later, the Government deviated—and by no small amount. It increased total investment by 44 percent, contrary to the law presented to the Assembly. Meanwhile, the branches and sectors identified as priorities above were ignored, receiving increases far below this average or even cuts. Specifically, changes in agriculture and food: plus 16 percent; industry and transport: minus 47 percent; education: plus 5 percent; healthcare: plus 15 percent; Ministry of Labor and Social Support: minus 23 percent. Contrary to the priorities, investment rose excessively in SHIK, plus 200 percent; Public Order, plus 164 percent; the State Audit, plus 687 percent; the Ministry

BSPSH is demanding a 35 percent wage increase in the public sector; the Government promises only a 10 percent wage increase. Nothing on inflation indexation Yesterday, another meeting was held at the Ministry of Labour headquarters between government representatives, led by Deputy Prime Minister Dashamir Shehu, and BSPSH, led by the chair of the trade union council, Mr. Valer Xheka. This was the conclusion of a meeting at which BSPSH reiterated its well-known position on inflation indexation. BSPSH is demanding a 35 percent wage increase in the public sector. Prime Minister Shehu also repeated the Government’s familiar position: a 10 percent wage increase, so that employees’ wages, including in the public sector, remain at the same level as inflation, and in Parliament. According to Mr. Shehu, a 35 percent wage increase, as demanded by BSPSH, is currently impossible. Mr. Xheka once again stressed the need to meet the demands that the education, health, telecommunications and higher education unions have submitted to the Government. He also said that BSPSH could make the case for meeting the stated demands, as well as other demands concerning pensions and the Labour Code, the drafting of which was deemed urgent. On the Government’s side, besides Shehu, those present included Education Minister Tellit, Health Minister Çikuli and Labour Minister Dakli, who each reiterated that the Government could raise wages in these sectors by only 10 percent and that, perhaps, the possibility of further wage increases could be reconsidered in the future. The union representatives argued, as they had at the meeting a few days earlier, that once current inflation is deducted, the 10 percent increase proposed by the Government for this sector is effectively reduced to an increase of 2–3 percent. The leaders of the independent unions reaffirmed that their activists would decide on the future course of the talks and how they would respond going forward. The Government side insisted on continuing the dialogue to resolve the problems. At the next meeting, the unionists had warned that they might resort to union action. Meanwhile, it is reported that education unions in several districts have called for strikes.

Just one day after the President of the Republic, Sali Berisha, in his capacity as Chairman of the Defense Council, signed the decision to establish the Defense College in Tirana, the inauguration of the College took place yesterday in one of the buildings of the General Staff Academy in Tirana. Those attending the ceremony included the President of the Republic and Commander-in-Chief of the Armed Forces, Mr. Berisha; the Minister of Defense, Safet Zhulali; senior political and military figures of the country; representatives of foreign embassies accredited in our country; military attachés, etc. NATO Deputy Secretary General, Mr. Kreg, who was visiting our country, was also in attendance. The Defense College, the first of its kind in our country, will be dedicated to the training of civilian and military leaders on matters of the country’s defense policy. (Continued on page 5)

Money changer seriously injured He was shot with a revolver and then robbed of his bag containing 22 million lek (old lek). The incident took place after 8 p.m. on a street among the alleys of the “Vullnetari” neighborhood in Elbasan. Money changer Ilir Zolli was on his way home when a revolver shot rang out in front of him, knocking him to the ground. The masked robbers then snatched his bag of money. The robbers fled in an unknown direction, while the money changer is in serious condition in Tirana’s military hospital.

Above Picar, in Gjirokastër, alone there are two flocks of 300 sheep each, people say as they discuss agrarian policy. But the shepherds have nowhere to take the milk, and keep putting off milking for no reason. There is no organization—not even a small private company—to come and collect the produce. The shepherds grow despondent and watch the livestock’s milk drip away.

The cinema in the town of Laç has been out of operation for four years. According to Mr. Hilë Kamani, director of the Palace of Culture in the town of Laç, the cinema has not been operating solely because of the municipality’s negligence and the lack of interest of the culture officials themselves. The equipment is there, as are the booth and the auditorium. So why is the cinema not operating?

REPORT OF THE MISSION OF THE PARLIAMENTARIANS’ COMMITTEE ON HUMAN RIGHTS IN ALBANIA, REGARDING THE NANO CASE