Financimi i qeverisjes vendore - sfidat bashkitë, komunat dhe sistemin bankar
Local Government financing and current challenges to municipalities, communes and the banking system

Summary/Abstract: Municipal decentralization from 1998 is based on three important column (1) function decentralization / new functions year by year for municipal units; (2) increment of financial instruments on municipal authorities hand (3) increase of institutional capacities. Law approval for organization and functioning of municipal authorities put the strategy of municipal decentralization on Albania on those three columns. It is clarified fiscal and financial instrument as main sources for own municipal authorities functions. At last, the approval on February 2008 the low for municipal authority loans is the important step in enforcing of finance and “municipal autonomy” on one hand and the express the maturity of those municipal units to make important decisions on behalf of community that they represent. On the other hand the banking market in Albania is prepared to explore such market because for many years is attempted such financing scheme on full partnership financial institution – municipal unit or and more complicating relations as scheme financing PPP (Private public partnership). Now with USAID assistance is explored this market and is realized the first commercial loan for one municipal unit, and are in process some other loans. The loan procedure is still the problem for all interest actors to take into the consideration the unknown risk for both parties, the buroucratic procedures, the actual financial market situation, the national banks and the continuous restrictions from approved authority of those loans as is Finance Ministry. But, are the municipal units prepared to enter in this market? What are those commercial loans in investment projection sense and are they ready to enter in relations with banks? What are on other hand the duties that are to take into consideration by financial and banking institutions in those relations and what will be the result?

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