Albania's new Socialist-led government targets economy, EU

Sun Sep 15, 2013 1:07pm EDT

* Socialists vow to take European Union agenda forward

* PM says to create 300,000 jobs, adopt progressive tax

* Government to meet IMF over finances

* Opposition says government will struggle to meet goals

By Benet Koleka

TIRANA, Sept 15 (Reuters) - The Albanian parliament on Sunday endorsed the new Socialist-led government of former Tirana mayor Edi Rama who has pledged to kickstart the economy, fight poverty, create jobs and move the country towards European Union membership.

Lawmakers voted 82 to 55 in the 140-seat chamber to install Rama's cabinet after his Socialists won a landslide victory over the ruling Democrats in June's parliamentary election.

The 49-year-old told parliament: "Our goal is clear: to govern the way Albania deserves. To give Albanians a clear, tangible sight of the European Albania they dream of and deserve."

Albania has been rocked by repeated bouts of political unrest since the fall of Communism in 1991, stalling the reforms necessary for the country to catch up with its Balkan neighbours on the road to EU accession. Its bid for EU-candidate status has been rejected three times so far.

Three days after the election, former prime minister Sali Berisha - one of the dominant figures of Albanian politics for more than two decades - conceded defeat, ending fears of a messy handover of power. The move was seen as a sign of growing democratic maturity in the Adriatic state.

But the West, which welcomed Albania into NATO in 2009, remains concerned about high levels of crime and corruption.

Rama has vowed to fight graft and told parliament: "Albania does not deserve the corruption and criminality that have tied its hands and feet."

Despite the euro zone debt crisis, the European Union remains a big draw for the Balkans, offering the prospect of stability, prosperity and freedom of movement.

Financial turmoil in Italy and Greece, Albania's main trade partners and home to around 1 million Albanian migrant workers, has hit the Albanian economy hard, with remittances tumbling.

It has avoided recession but growth rates of up to six percent a year between 2000 and 2009 have more than halved. The economy eked out a 1.7 percent expansion last year.

The new government inherits a public debt level of 63.3 percent of gross domestic product, higher than the International Monetary Fund recommends for similar emerging economies.

Rama said: "We are preparing to talk directly with the IMF, not necessarily to start a new programme, but to understand clearly what crisis we are facing and how to respond.

"We have vowed to create 300,000 new jobs and we will work day and night to achieve that goal."

The Socialists have said they will reintroduce a progressive tax system to replace the flat income tax of 10 percent.

The opposition Democrats left the chamber on Berisha's cue during Rama's policy speech on Wednesday. Their new leader Lulzim Basha has dismissed the new government's programme, saying it had no real development plan, no resources and its policies were not based on concrete calculations.

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