The Investment Council (KI) on Monday held its next meeting chaired by the Minister of Finances and Economy, Mr. Arben Ahmetaj, with the special participation of the EBRD Vice President of the Banking Sector, Alain Pilloux and the newly appointed EBRD Director for the Western Balkans, Zsuzsanna Hargitai.
The agenda for this meeting was “The Legal Framework for Investments, Debates and Challenges” in order to discuss how motivating and “easily applicable” is the current legal framework for investments as well as to facilitate the process of preparing a legal framework more simplified, capable of holding investments or promoting new investments. The topic of discussion was also developed in the context of the country’s EU and regional integration processes within the Reaction to the Regional Economic Zone (REA). A REA component is also the Regional Investment Agenda (RIRA), which aims inter alia to harmonize the legal and regulatory framework of local investment with best international practices.
In his speech, IC Chairman, Minister Arben Ahmetaj, underlined the importance of the legal investment framework in terms of guarantees, transparency and predictability for investors. “We need to identify together all the elements of the current legal framework and make the relevant changes if necessary, that precede the ambitious goals of our government for economic growth, ” underlined Minister Ahmetaj.
Vice-President of EBRD, Alain Pilloux confirmed EBRD support to Albania. He congratulated KI for the work done so far, while reaffirming EBRD support for this initiative. Mr. Pilloux encouraged the government to continue to improve the business climate as a very important factor for investment and sought to focus on implementing reforms, especially those dealing with important issues such as property rights, informality, public administration capacities, etc.
Following, Mr. Pilloux announced that the EBRD will continue to support private sector growth in the Albanian economy, mainly through banks through the risk-sharing instrument, to encourage them to take more risks in their lending operations, aiming to increase as much as possible lending in LEK. In addition, the EBRD is drafting, in cooperation with the EU, an innovative program, co-funded by the EBRD and the EU, with a total of about EUR 100 million to promote competition in the tourism sector.
The Director of the Secretariat of IC, Ms. Diana Leka, made a presentation on the main elements of the investment climate related to legal aspects, institutions and administration and economic policies. The presentation also referred to the previous KI work since April 2016, with the comparative analysis of the Secretariat on incentives to boost investment in Albania and the countries of the region. “The main objective of the new legal framework should be to create the conditions for attracting high-value-added investments in the economy chain that will have long-term positive effects on the economy. The recent recovery of economic growth was also driven by investment and the harmonization of the legal framework with best international practices could bring a new impetus to investment in the country, said Leka.
In the presentation were also included many elements discussed also in the consultative meeting with the business community held on 23 May 2018, where more than 60 participants were present. This meeting was organized by the Secretariat of KI in cooperation with the Ministry of Finance and Economy and the International Finance Corporation (IFC). The main discussions at this meeting focused on whether the new investment law would be a detailed law or law, in the legal security issues it should offer, the scope and objectives of the legal framework, the mechanisms for solving the complaints of investors ” grievance mechanism “, harmonization with the International Investment Arrangements (BITs), the importance of its harmonization with sectoral laws, the importance of the principle of fair and non-discriminatory treatment between domestic and foreign investors, the guarantee that should be borne by documents issued by state institutions, of ownership etc. All of these comments are part of the Secretariat Summary, which also includes an IFC presentation on ” Harmonization of the Legal Framework for Investment in Albania with International Good Practices ” and a comparative analysis prepared by the Secretariat on the Model of Mechanism for the Grievance Mechanism ‘s Settlement Appeal in 6 countries.
KI members from the business community highlighted several aspects that could further improve the investment climate such as fair and equal treatment of domestic and foreign investors; the fair use of infrastructure tax in the benefit of both investors and municipalities; the full responsibility of the institutions for the documents issued by them; the pattern of application of indirect taxes for specific industries in line with EU standards; institutional harmonization and coordination.
In conclusion, KI Chairman confirmed that the guarantee of documents issued by state institutions is an element deserving to be taken into account in the new law, while the debate continues whether this would be a framework law or a detailed law. Meanwhile, with regard to the infrastructure impact taxation destination, Minister Ahmetaj shared the view that this issue deserved to be subject to discussion by the Government.
At the end of the meeting, the IC chairman urged business representatives to submit comments to the Secretariat on the current legal framework, confirming that the draft law will be shared and consulted in due time with the business community through IC.
News Source DPT