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Speech of Ambassador Vlahutin to the Working conference 'Municipalities in the EU integration process of Albania'

26.04.2018
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  • Dear Mayors, dear EU local coordinators, representatives of the central government, dear colleagues Ambassadors,

 

  • I am very happy to open this meeting today, because all the recent good news about the progress of Albania on its EU accession reform path need to be further strengthened with strengthening of the local governance, and a major change that is yet to happen in the role of municipalities when it comes to the development, economic growth, social cohesion and prosperity of the entire country.

 

  • Accession to European Union involves all levels of governance and the whole of society, and Albania will not grow unless all of its parts will be able and strong enough to grow as well.

 

  • We are trying to be of assistance, not only with the program of having a desk in every municipality dedicated to the EU but also with streamlining many of our other IPA assistance programs to the municipal level. Let me just mention local employment offices or targeted pilot project on development of tourism, and I can promise you that we will be doing even more in the future.

 

  • With the project of EU desks we wanted to help you as Mayors, and citizens in your municipalities, be better informed of all the opportunities that EU offers for the local governance level, to help your citizens get proper and accurate information, and to help you develop absorption capacity that you will need very much also once Albania becomes a member of the EU.

 

The EU-funded project 'Municipalities for Europe' helped to produce the first ever mapping in Albania of local government performance related to EU matters, and this report will be made public today.

 

You are closest to the citizen, and municipalities make very important contribution in areas such as the rule of law, property rights, human rights, social policies, agriculture and rural development, education and environment to name just a few.

 

  • Improving local performance will require a combined effort from you, central government, and donors. It is essential that you keep raising your concerns, and at the same time try to offer solutions and not get stuck only in talking about problems.

 

  • Areas like fiscal decentralisation, public and social services delivery, governance and rule of law are crucial and I am confident you will take advantage of the panels later today to discuss your concerns but also ideas on how to improve the situation. You will have an opportunity to hear from EU Member States experts and practitioners from Poland, Croatia and Italy, on how this works in their countries and maybe be inspired by some of their models.

 

  • Let me just mention you some figures, which do point to the fact that when it comes to the strong local governance, Albania still has a long way to go: for instance, the share of local revenues compared to the country's total revenues for Albania is among the lowest in the region, 14.1 %. Kosovo is having 30,3 %. The EU average is 24,8 %.

 

If we measure local revenues against GDP, again Albania stands far behind.  While the average of the EU is 11.3% this figure in Albania amounts only to 2.5 %. This is the lowest including neighbouring countries like Montenegro (6.1%) and Kosovo (7.6%)

 

  • On total GDP per capita, local government revenues represent in Albania only 9%. The regional average is 17% and that of the EU 25%.

 

  • On shared taxes, for example, 2% of revenues from personal income tax will be allocated to Local Government Units for the first time under the new law on local finances. This is a development in the right direction. However, in some countries like BiH this percentage goes up from 34.46% to 41%. In Slovenia it is about 50%.

 

  • It is clear that comprehensive fiscal decentralization is essential. Let me just take the example of Kukes, which is one of the poorer parts of Albania, with very high emigration level and high unemployment. At the same time, around 70 % of electricity on the national level is produced there, and the municipality receives no financial benefits from that whatsoever.

 

  • Let me mention Bulquise and the mining industry, and the fact that only 5% of revenues go back to the municipality which desperately needs funds for development. Municipalities should benefit from the businesses working on their territory. I was in Mirdita, also one of the poorer parts of Albania, where the entire region can go through a real renaissance with an investment calculated at 25 million euros put into the wine production.

 

  • It is clear that some recalculation needs to be done, and that municipalities need to be able to raise their own tax revenues, invest in the services for their citizens but also think harder on how to attract business investments.

 

  • It is pivotal that this next phase of Albania's approximation to the EU standards is done with full inclusion of municipalities. This needs further discussions, so that your country can make the optimal policy choices.

 

  • Ddevelopment of new policies and programmes need to be evidence-based, fully supported by clear and accurate information on the implementation of EU standards and criteria on the ground.

 

  • I hope that this first mapping exercise will be of help and that it will become a regular reference point for monitoring progress of EU integration at the local level.

 

  • At the end, let me thank you again for coming, thank you for all you are doing to improve the quality of life of citizens in your municipalities and rest assured that European Union will be a very strong and reliable partner in your ambitions to create prosperous local communities.
Category
Speeches of the Ambassador
Location

Tirana

Editorial sections
Albania