March 3, 2020 / 6:14 PM / a month ago

Albania offers amnesty to curb shadow economy, revive growth

TIRANA, March 3 (Reuters) - Albania’s government plans to offer an amnesty to businesses that have failed to disclose funds or made illegal gains for a fee, in an effort to formalise and revive the economy, open firms’ access to capital markets, and plug a budget shortfall.

Business association Konfindustria estimated on Tuesday that Albania’s informal economy equals 50% of Albania’s gross domestic product, adding one million Albanians live abroad and $30 billion had been taken out of the Balkan country illegally.

Finance Minister Anilaj Denaj said the draft law would comply with international standards.

The country of 2.8 million, which borders European Union member state Greece, is pushing to start entry talks with the bloc.

Last year the state earned 26.3 billion leke ($240 million) less than planned and a European body fighting money-laundering is monitoring Albania for compliance on 17 issues.

“Formalising the informal economy is a priority for the Albanian government,” Denaj said.

She said the amnesty and the level of fee would distinguish between those who had gaps on their books and those who had dealt in illegal activities.

“For us this difference is very clear and should be clearly marked, with special tools, and I think this will also help the process of public consultation,” Denaj added.

“We cannot give details on the level of fees, we are still discussing figures. It will be a low level and it would make possible the declaration of assets and stimulate businesses to get formalised, especially the mid-sized and big ones to access capital markets.”

Prime Minister Edi Rama said on the weekend the amnesty would not apply to convicted criminals, politicians, judges and prosecutors.

Denaj said that since Albania toppled communism 30 years ago businesses had often operated with inaccurate financial statements, hurting their chances of getting loans.

“The banking sector feels this the most... That is why we think it (the amnesty) will also stimulate lending,” Denaj said.

$1 = 109.6800 leke Reporting by Benet Koleka Editing by Alexandra Hudson

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