"Developing countries are facing the worst debt crisis in history. Spending on health and education is being cut because almost half of the budgets are used to pay creditors." When the pandemic crisis broke out and its impact on the economy was leading the affected countries into recession, accompanied by a drop in economic growth, an increase in unemployment, and the bankruptcy of many businesses, it was the former President of the ECB, Mario Draghi, who, on behalf of "the protection of the economy," called for an "increase in budget deficits and public debts" in order to inject into the economy the hundreds of billions of euros necessary to cover expenses. 
In fact, for the moment, to face this crisis, public debt was the only instrument that could be used, even though it was considered as "breaking the taboos of the Maastricht treaty," which did not allow the debt to exceed the value of 60% of GDP. But even the proponent of this instrument and all the experts were aware of the risk of a new debt crisis that could threaten developing countries. And here we are today: 

DEVELOPING COUNTRIES FACING THE WORST DEBT CRISIS IN HISTORY 
Developing countries are facing the worst debt crisis in history, with almost half of their budgets being spent on repaying creditors. In the report drawn up by the campaign group "Debt Relief International for Norwegian Church Aid", it is said that more than 100 countries are struggling to meet their debts, which has forced them to make cuts in investments in health, education, social defense, and climate change measures. Debt servicing is absorbing 41.5% of budget revenues, 41.6% of expenditures, and 8.4% of GDP on average in 144 developing countries, according to the study. 
The report notes that, without urgent action, these problems will continue to worsen into the 2030s and that the pressures are greater than those during the 1982 Latin American debt crisis and the debt crisis of the 1990s. This report pushed for relief measures through the Indebted Poor Countries Initiative (HIPC). In 2020, the G20 group of major developed and developing countries launched the Common Framework, a scheme designed to speed up and simplify the debt relief process. However, progress has been much slower than expected, highlighting the fact that poor countries now owe a large portion of their debt to China and private shareholders. 
Among the suggestions made in this report are that debt relief be: 
Available to countries of all income levels and regions and suitable for their needs. 
Deliverable in such ways that lead to the reduction of debt servicing expenses to less than 15% of budget revenues. 
Available quickly and with immediate payment suspensions when a country applies for relief. 
Inclusive for all creditors. 
A guarantor of legal protection for debtors against fraud and lawsuits in all major financial centers. 
Matthew Martin, one of the authors of the report, called on the new British government to draft and pass legislation to prevent so-called predatory funds—funds that buy debt at a low price and then seek to make a profit from it—through the use of UK courts to sue poor countries. "We now have the worst debt crisis in history, largely because more and more countries have entered international bond markets and developed domestic bond markets to finance their development," Martin noted. 
A debt crisis is paralyzing and undermines all other development efforts. The 1982 crisis lasted over 20 years and caused much suffering before it was finally resolved in 2005. Is there a generation today capable of dealing with this new debt crisis that is coming? 

WHAT ABOUT ALBANIA? 
If around 100 countries are deeply shaken by the debt crisis following the pandemic, Albania is performing positively in managing this problem. This success is attributed to the country's economic performance and the implementation of a "vigilant" monetary policy. According to the press statement from the last IMF Mission in July 2024, "The Albanian economy grew by 3.5 percent in 2023, led by stable private consumption, with considerable strengthening in tourism and construction. The performance of the fiscal sector and the external sector has exceeded expectations, with a primary surplus and a current account deficit of 0.7 percent and 1 percent of GDP, respectively. Inflationary pressures have decreased, with inflation reaching 2.1 percent in June due to the drop in raw material prices. The economy is expected to maintain its positive momentum this year, with expected growth around 4 percent. Inflation is expected to gradually return to the 3 percent target." 
This good performance and correct orientation of fiscal and monetary policy (including the strengthening of the national currency, the Lek, in relation to the USD and the Euro, even though about 70% of foreign debt is in Euros) have positively affected the situation of public finances, particularly in managing public debt and the budget deficit. Foreign debt has followed a downward trajectory since 2015, except for the year of the pandemic. The ratio of foreign debt to GDP has decreased significantly, from 74.4% at the end of 2015 to 46.8% in the first quarter of 2024. Meanwhile, the ratio of foreign debt is expected to decline gradually in the medium term, supported by GDP growth, fiscal policy commitment towards reducing public debt, and improvements in the foreign sector of the Albanian economy. 
Additionally, public debt has followed a downward trajectory since 2015, with the exception of the pandemic years, supported by the pursuit of a consolidating fiscal policy and rapid economic growth in the country. Public debt in 2023 was estimated at 58.9% of GDP, marking a decrease of 5.5 percentage points from the previous year. The appreciation of the local currency also had a positive impact, reducing the weight of foreign debt to 26.9% of GDP. At the end of 2023, domestic debt represented 32.1% of GDP, or 54% of total public debt. 
This positive situation in public finances and measured public debt management highlights the need for more effective use of expenses, especially for investments. The surplus of 51 billion ALL should be allocated in a balanced way for further debt reduction, financing investments, and social policies. With only five months remaining in the year and the election year approaching on January 1, 2025, more initiative is required for the efficient use of financial resources, budget expenditures for investments, and public finances in general. This approach is essential to better guarantee continuity, development, and economic growth in the country. 

*Academician Prof. Dr Anastas Angjeli is an economy expert, former Finance Minister and MP, president of the Mediterranean University of Albania