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Albania: Global Community Prepares To Help

Washington, 8 August 1997 (RFE/RL) -- As the bulk of an Italian-led multinational protection force begins withdrawing from Albania, the international community is preparing to launch a major civilian assistance program to help get the battered nation back on its feet.

The International Monetary Fund (IMF) expects to have a team of officials in Tirana by the end of next week to start negotiations on what financial assistance it may be able to offer.

That team will be followed immediately by several groups of experts to provide quick technical help in rebuilding the country's tax system and the central bank.

At about the same time, the World Bank says it expects to have its own mission in Albania to assess how it can help the new leaders get the government -- and governance -- back in operation around the country.

The Bank team will also be assessing how it can restructure and restart over 72 million dollars in projects that were receiving support from the Bank's International Development Association (IDA) before collapsed pyramid schemes brought down the entire economy and government last year.

U.S. President Bill Clinton, in a letter to Albanian President Rexhep Mejdani and Prime Minister Fatos Nano this week, spoke for the international community when he said it is "ready to assist your government in its pursuit of meaningful political and economic reform necessary to restore normal conditions in your country."

Clinton said the Prime Minister's pledge to include a broad spectrum of political forces in the governing process "is very encouraging in light of the political polarization that has afflicted your society."

The U.S. president noted that the civil unrest and economic upheaval Albania has suffered present Nano's government with "a tremendous task." However, he said he was "confident that, as long as your country remains on the path of reconciliation and sound policies, Albania will have a stable and prosperous future."

A draft recovery plan drawn up by the World Bank, the European Council, and the EBRD (European Bank for Reconstruction and Development), with input from the IMF, makes clear that before international money can begin to flow, Albanian authorities must gain control of the entire country and be able to maintain security.

An IMF representative told an international conference on Albania in Rome last week that the fund envisions providing quick money under its special emergency program for post-conflict nations, followed by one of its subsidized programs for helping a country rebuild its basic governing structure.

However, he said, before ANY financial programs can be launched, Tirana must "significantly" improve security in the country, gain control over all of the nation and get its tax and banking system put back together.

The IMF representative said this is critical because without tax collections -- which have fallen dramatically due to the lack of security -- the government's budget has gone into deep deficit and that has pushed inflation up to over 40 percent so far this year.

World Bank officials agree that basic security must be in place, and then efforts can be launched to begin essential institution building, including judiciary and governance reforms. At the same time, emergency reconstruction of the country's battered infrastructure must begin and efforts must be made to create employment opportunities while expanding the social safety net to protect the most vulnerable in the crisis.

The World Bank and the International Monetary Fund have been working with Albanian authorities on a way to deal with the festering sore that started all of this -- the pyramid schemes that destroyed so many people's life savings. IMF officials say they have made "substantial progress" and hope that once Albania approves the legal framework to wind up the pyramids, a key condition for international aid will be met.