Denada Jushi
Public debt continues to be a challenge with consequences for citizens, but also for economic development and the path towards the European Union. According to the European Commission's 2025 Report, the country's public debt is around 53.5% of GDP, ranking Albania among the countries with the highest level in the Western Balkans, after Montenegro (58.6%).
Such a burden demonstrates the government's challenges in managing public finances and guaranteeing fiscal stability, a key element for progress in EU accession negotiations.
In 2013, Albania's public debt was around 70.5% of GDP, a high level for a small economy exposed to external risks. In 2015, debt reached a historic peak of 73.7% of GDP.
This was the moment when debt management became a major political and economic topic, challenging the state's ability to balance spending with the emergency needs of the population.
From 2016 to 2019, debt began a gradual decline, from around 72% to 66.5% of GDP, due to consolidation policies and economic growth that partially stabilized the situation. The European Commission cites this period as a relative improvement, but underlines that progress was not sustainable and remained affected by economic fluctuations.
In 2020, public debt increased significantly, reaching 75.9% of GDP, due to the COVID-19 pandemic and emergency spending. This year is considered a historical negative record. In 2021, debt remained high, around 74.5%, still reflecting the effects of the health and economic crisis.
From 2022 to 2025, the debt-to-GDP ratio has marked a gradual decline:
• 2022: 67%
• 2023: 62%
• 2024: 58.5%
• 2025: 53.5%
Although the trend is positive, the European Commission emphasizes that the level of public debt remains high compared to countries in the region, ranking Albania among the countries with the heaviest fiscal burden in the Western Balkans.
In relation to the region, Albania ranks second, after Montenegro (58.6%). Other countries register lower levels: North Macedonia (50.3%), Serbia (43%), Bosnia and Herzegovina (26.4%) and Kosovo (16%). This comparison shows that, although there are improvements, Albania remains above the regional average, indicating that the road ahead of our country is still long.
The European Commission emphasizes that high public debt hinders strategic investments and limits fiscal freedom. For a candidate country like Albania, keeping debt at controlled levels is essential for progress in the European Union accession negotiations.
With the new draft budget for 2026, public debt is expected to undergo some slight changes.
In absolute terms, debt is expected to increase slightly, due to planned borrowing during the year, reaching around 2.6 trillion lekë. In relation to GDP, debt is projected to decrease somewhat, from around 54.1% at the end of 2025 to around 53.6% at the end of 2026, as a result of expectations for economic growth and fiscal discipline.
The draft budget targets a deficit of 2.3% of GDP and a positive primary balance, maintaining control over debt and supporting fiscal sustainability.
Although debt has decreased, the report identifies other issues related to fiscal management, such as:
- Politicization of appointments and lack of transparency in the budget, which hinder structural consolidation.
- Corruption and weaknesses in public administration remain key challenges.
- Low capacity for managing capital expenditures, which places the country in a vulnerable situation to crises and external economic shocks.
The report also highlights challenges in other areas such as education, waste management, digital skills and social development, which are improving but still fall short of European Union standards.
Albania has managed to reduce its public debt from alarming levels in 2020, but the challenge remains. The European Commission warns that only prudent fiscal management, coupled with structural reforms and transparency in spending, can guarantee long-term sustainability and real progress towards the European Union./acqj.al
