Germany lends Albania 106 mln euros ahead of Merkel visit

Germany lends Albania 106 mln euros ahead of Merkel visit

Chancellor Angela Merkel* Germany lends Albania 106 million euros for power, water

* Deals signed before visit by German Chancellor Angela Merkel

TIRANA, July 6 – Germany lent Albania 106 million euros on Monday to back the country’s cash-strapped utilities, fund small and medium-size enterprises and bring water to rural areas.

The agreements were signed by ministers of Albania’s coalition government and Germany’s ambassador before a visit by Germany’s Chancellor Angela Merkel on Wednesday.

At the weekend, Merkel urged the western Balkan states of Albania, Serbia and Bosnia and Herzegovina to build greater political stability, to smooth their path to membership in the European Union. She will visit all three countries this week.

Her visit also comes after debt-ridden Greece voted against accepting a bailout on terms imposed by its creditors. Greek banks are active throughout the Balkans, and fears have been growing that the debt crisis could spread in the Balkans.

However, an International Monetary Fund team said last week Greece’s troubles were unlikely to spill into Albania. Three units of Greek banks controlled 15.9 percent of total assets in Albania in 2014, but unlike Macedonia and Serbia, Albania has not restricted capital transactions with Greece.

“Today is a good day … After years of preparation, we signed six important financial cooperation deals,” German Ambassador Helmut Hoffmann said after the signing.

“This creates an excellent atmosphere on the eve of the visit after two days of the Federal Chancellor Angela Merkel. Hundreds of thousands of Albanians gain from these projects.”

Most of the funds from Germany will fund the electricity sector, with 40 million euros ($44 million)going to the KESH monopoly power producer and 20 million euros for the security of hydro power dams.

Albanian Finance Minister Shkelqim Cani said Germany had helped Albania since 1988 – two years before the Iron Curtain fell – with more than 1 billion euros in aid, including its European Union and United Nations contributions.

On Sunday, Hoffmann commemorated with Albanian villagers the massacre of 107 people in eastern Albania by the German Army in World War Two in retaliation for a partisan attack, saying every German felt ashamed.

(Reuters)

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