Commentary of Kseniya Lvovsky, World Bank Country Manager published by daily Ekonomia and Albania Daily News

November 16, 2010

Kseniya Lvovsky, Country Manager Shqip and Albania Daily News

This article is a brief account of my very first impressions about the country that is now my new home. It will be continued by a monthly series through which I would like to discuss with the broader Albania public specific priorities facing the country and how the World Bank helps address them.

Coming to Albania has been a wonderful discovery. A beautiful Balkan country with a fascinating history and rich cultural heritage remains a mystery for many people outside the immediate neighborhood. Indeed, the pace of economic and social transformation over the past two decades has been so dramatic that global perceptions lag behind. A journey from a very poor country in early 1990s to an upper middle income economy, the status Albania gained this summer, is remarkable by any comparison. As the world is absorbed by emergence of powerful BRICs (Brazil, Russia, India, China), Albania’s economic growth has been, on average, stronger than in those countries except China. It is considered a success story by the International Development Association (IDA), an arm of the World Bank that provides highly concessional finance to the poorest countries, from which Albania graduated in 2008. I happened to work - at different points of time - in all BRIC countries, and this experience allowed me to better appreciate Albania’s achievements. The issuance of the first Eurobond last month confirms the country’s move to a different league.

No less remarkable - and probably unprecedented – is a journey from one of the most isolated countries on earth to a soon-to-be visa free travel in Europe and a path towards EU accession. Another notable success, albeit not well known internationally, is arresting violent crime and ensuring public order. The streets of Tirana are safer than those in Moscow (my home city) and Washington DC (where I worked and lived in the past 18 years); yet, my friends from both cities responded to my invitation to visit me here by raising concerns about their safety! Telling the story of Albania’s transformation to the world – and thus both helping this country to improve the international image and enabling less advanced developing countries to learn from its experience - is one of the areas where I would like to see the World Bank doing more.

After just a few weeks in the country, I am impressed to see the intensity of intellectual debate about future directions – from social services to decentralization to the overall drivers and priorities of post-crisis economic growth. Some of the most innovative and comprehensive reforms are initiated, such as in higher education, where the World Bank, together with other partners, is supporting massive government efforts. The timing is right. In the post-crisis world with multiple poles of growth and increasing competition, the recipes for success have become tougher. For Albania, it has also coincided with becoming an upper middle-income country, which by itself requires a new, more sophisticated growth strategy. The one that would create the foundation for long-term competiveness and sustainability while eradicating the remaining poverty. The one that would avoid the main risk of success: overconfidence and underestimation of future challenges. Strong democratic institutions, vocal civil society, and open debate are critical for mitigating this risk. The World Bank will continue, as it has been, contributing to the debates and search for development solutions, as well as their implementation - through financing, leverage and convening power, technical assistance and analytical work. Our flagship report entitled “Albania: The New Growth Agenda” will be disseminated in the coming weeks.

Importantly, the fight over poverty is not over, as my visit to several communes in the Kukes district made painfully clear. These communes are supported by the Natural Resource Development project that the World Bank is co-financing. The improvements in their livelihoods brought and documented by the project are heartening. But while not in big numbers and falling, there are still villages in rural Albania where people live without adequate access to water, nutrition, social services and opportunities for their children. Helping better target social services and improve water supply to urban and rural populations is a key focus for World Bank work this year. Opportunities for unemployed, and particularly youth, to realize their talents and potential in their own country are an issue even in affluent cities. That is why we are also working with the municipalities of Tirana and Durres to help youth acquire skills and jobs.

While the needs and challenges are formidable, signs of progress and momentum are everywhere. I am still to learn and appreciate a lot about Albania but I already know that it is a distinct privilege to work here and contribute to country’s development at this time. I will do my best.