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Recent progress in NSSED implementation in Albania Adrian Civici Ministry of Finance Conference on labour markets, growth and poverty reduction strategies 28 May 2005 Thessaloniki GPRS - November 2001 NSSED – December 2002 PRINCIPALS OF NATIONAL STRATEGY • Objective harmonization / main agenda • Prioritarisation of public actions • Albanian ownership Priority fields (i) improved health and education services and (ii) improved infrastructure Pillars (iii) institutional reform (iv) economic growth Conditions for implementation (v) macroeconomic stability (vi) social support NSSED Institutional structure Steering Committee (Chaired by Prime Minister) Inter- Ministerial Group (Chaired by Minister of Finance) MoF/ DoNSSED Technical Sector Working Groups in line Ministries NSSED M&E in line Ministries Other Institutions involved in the process: (Bank of Albania, INSTAT, etc) Proportion of total expenditure (%) Public expenditure in priority sectors, 2002-2004 30.0 25.0 20.0 15.0 10.0 5.0 0.0 Agriculture Education Health Energy Housing and communal services 2002 2003 2004 Social welfare Transport and telecommunications Proportion of total expenditure (%) Capital investment in priority sectors, 2003-2004 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Agriculture Education Health Energy Housing and communal services 2002 2003 2004 Transport NSSED goals and achievements Objective (unit) Actual Target 2001 2002 2003 2004 2006 1386 1557 1950 2604 2660 GDP growth rate (%) 7.6 4.7 6.0 6.0 6.0 Budget deficit as proportion of GDP (%) 6.6 5.6 4.4 4.6 5.0 Inflation rate (%) 3.1 5.2 2.4 2.9 3.0 Growth GDP per capita ($) Poverty Absolute poverty headcount rate (%) 25.4 20.0 Extreme poverty headcount rate (%) 4.7 3.0 Unemployment rate (%) 16.4 15.8 15.0 14.4 12.0 Infant mortality per 1,000 live births 17.4 17.5 15.5 15.1 15.0 Maternal mortality per 100,000 live births 22.7 25.9 21.3 12.0 15.0 Health Measuring progress in poverty reduction The poverty monitoring system is built on the Living Standards Measurement Survey: • 2002 – Estimation of poverty indicators • 2003 and 2004 – No consumption module Poverty trends in 2003 monitored through a model: how did variables correlated with consumption poverty in 2002 change in 2003? Results of FAO research team suggest that poverty rate has fallen in 2003 – more so in urban than in rural areas Labour market in Albania Labour force participation according to the Census 1989 2001 Male Female Total Male Female Total 842 758 1600 800 548 1347 Employed 71.5 63.8 67.7 60.8 35.6 48.0 Unemployed 5.7 9.0 7.3 14.0 14.1 14.1 Total active 77.2 72.8 75.0 74.8 49.7 62.1 Inactive 22.8 27.2 25.0 25.2 50.3 37.9 Total (aged 15 years +) 100 100 100 100 100 100 In thousand Labour force (aged 15 years +) As percentage (%) Age of population Pyramid 80+ 80+ 70-74 70-74 60-64 60-64 50-54 50-54 Male 40-44 Female Female 30-34 30-34 20-24 20-24 '10-14 '10-14 0-4 -250 Male 40-44 0-4 -150 -50 50 150 250 -250 -150 -50 50 150 250 Labour market indicators No Labour Force Survey Unemployment rate is estimated from the records of the registered unemployed at Employment Offices Evidence from the Living Standards Measurement Survey confirms that unemployment is falling Men rather than women are more likely to benefit from new jobs NSSED labour market policy objectives Strategy of employment and vocational training Build capacity of Regional Employment Offices 8000 job mediations in 2004 Strengthen vocational training system by expanding capacity and modernising curricula Two vocational training centres constructed in 2004, co-financed by the budget and the CARDS programme NSSED labour market policy objectives Strategy of employment and vocational training Employment promotion projects • Salary and social contribution subsidies over 5-7 months; • The company has to keep at least 50-70% of subsidised persons as permanent staff • 3385 jobs created in 2004 at a cost of $1,070 each Current challenges for the NSSED Link strategic priorities to the budget Harmonise and streamline existing planning systems: poverty reduction, European integration, decentralisation; Monitoring of progress and transparency; Establishment of an integrated planning system Future challenges for NSSED Role of NSSED in Integrated Planning System • identify pathways to national goals and set indicators • oversee sector and crosscutting strategies, including indicative costing • continue monitoring poverty for policy purposes • advise on policy implications for MTBP Future challenges for NSSED • Revision of NSSED in 2006 • Ensuring sustainable growth supporting new sources of growth; • National consensus building / assembly • Maintain Albanian Ownership and donor’s coordination and development partners.