VZCZCXRO0195
PP RUEHIK
DE RUEHTI #0700/01 2991530
ZNR UUUUU ZZH
P 261530Z OCT 09
FM AMEMBASSY TIRANA
TO RUEHC/SECSTATE WASHDC PRIORITY 8546
RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY

UNCLAS SECTION 01 OF 02 TIRANA 000700 
 
SIPDIS 
 
STATE FOR EUR/SCE 
 
E.O. 12958: N/A 
TAGS: PGOV ENRG EFIN PREL PHUM PINR AL
SUBJECT: Embassy Tirana Weekly Report 
 
TIRANA 00000700  001.2 OF 002 
 
 
¶1.  (U) The following is a weekly report prepared by Embassy 
Tirana's local staff to provide political and economic context and 
insight into developments in Albania. 
 
Central Bank Taking More Active Role in Economy 
--------------------------------------------- -- 
 
¶2.  Central Bank Governor Fullani recently increased his presence in 
the public to unveil the Albanian central bank's (known as the Bank 
of Albania) stance and its actions to mitigate the negative effects 
of the global economic downturn on the Albanian economy.  The 
financial sector in Albania has been largely spared from the initial 
devastating effects of the crisis.  However, both consumer 
confidence and economic activity have declined. Over the past year, 
bank deposits have declined by approximately ten percent, and banks 
have continued their conservative lending practices.  Even though 
both deposits and lending have seen recent upticks, the trend since 
last year has been negative.  This in turn has restricted banks' 
performance and their role as economic activity promoter. 
¶3.  Following the departure of the IMF mission from Albania in 
August, Fullani tried with some success to take over the IMF role as 
the watchdog of the government's financial policies and its 
implementation of the state budget. Fullani has repeatedly called on 
the government to remain focused - especially during the current 
developments - in maintaining country's macroeconomic stability as 
one of the best achievements in Albania.  More specifically, Fullani 
has raised the attention paid to long-term fiscal indicators, 
macroeconomic stability, and the GOA's expenditure approach and 
their effect on the budget deficit. 
¶4.  The Albanian Central Bank has managed to play an important role 
in tackling several problems and supporting and monitoring the 
banking sector in order to prevent any serious threat.  It has 
maintained a stable interest rate as an important anti- inflationary 
measure, despite political pressure on the Bank to reduce rates. 
The Governor himself has defended the domestic currency, the Lek, 
during a recent (and short-lived) sharp decline vs. the Euro, 
underlining that the Lek has been, is and will remain a successful 
currency for Albania, adding that it will serve Albania until it 
eventually enters the European Union.  Nobody can say with accuracy 
when the current global economic crisis will be over.  However, all 
appearances are that the BOA is playing a constructive and 
stabilizing role, and is helping to insulate as much as possible 
Albania from its negative effects. 
Minister of Economy, Trade and Energy, Dritan Prifti 
--------------------------------------------- ------- 
 
¶5.  Dritan Prifti was born on August 27, 1968 in Berat.  He received 
a Master's of Public Administration (MPA) from Harvard's Kennedy 
School of Government in June 2000.  He received a Master's of 
Business Administration (MBA) from the University of New Mexico in 
December 1995. 
 
¶6.  Mr. Prifti served as Minister of Energy during September 2001 - 
February 2002.  For a period of three months in 2000 he served as 
General Director of the Albanian Power Corporation (KESH).  This is 
his third term as a Member of Parliament.  Mr. Prifti is member of 
Socialist Movement for Integration (LSI) and represents this 
political party in the Albanian Parliament. 
 
Children of the Blood Feud 
-------------------------- 
 
¶7.  Sitting forlorn on the banks of the Lana river stands a 
run-down, three-storey building known by many in Tirana as simply 
"the blood feud building."  The purple house stands as a relic and a 
reminder of Albania's past history with blood feuds.  At least one - 
and perhaps even several - families live secluded in the house, 
unable to leave the building out of fear that they will be killed as 
part of an ongoing blood feud. 
 
¶8.  According to the Nationwide Reconciliation Committee, whose aim 
is to mediate interfamily revenge killings, more than 800  children 
across Albania are essentially imprisoned in their own homes, unable 
to leave out of fear of death.  For this reason these children do 
not attend school.  Attempts were made by the Ministry of Education 
this year to develop special home-schooling curricula.  According to 
media reports, however, the home schooling by qualified teachers has 
not commenced yet. 
 
¶9.  It is important to note the that blood feud killings in Albania 
are rare - the Ministry of Interior reported that in 2009 there have 
been only four deaths so far related to blood feuds - the lowest 
number in 18 years.  The blood feud is an anachronistic practice 
codified in the Canon of Leke Dukagjini, a code of law that emerged 
in the 15th century to govern life in the isolated north of Albania. 
 This tradition was banned by the communist regime and ruthlessly 
suppressed, but took hold again in the chaos after the collapse of 
communism.  The Code says that serious wrongdoing must be avenged by 
killing a male member of the family that committed the wrong.  This 
in turn leads to a cycle of killings that put at risk all male 
members of the extended family.  Feuds can go on for years or 
 
TIRANA 00000700  002.2 OF 002 
 
 
generations. 
 
Gjirokaster Folk Festival 
------------------------- 
 
¶10. Gjirokastra was the home of the 2009 traditional Albanian folk 
festival.  Held every four years, the festival is usually takes 
place in the fall.  Over 1,000 Albanian singers and dancers from 
Albania, Kosovo, Macedonia, Serbia, Italy, Germany, Switzerland and 
the U.S. came together for the festival.  The National Folklore 
Festival had its beginnings in 1968, when it was organized for the 
first time in Gjirokastra. 
 
¶11.  This year Ambassador Withers and a group from the Embassy 
attended the Festival, while paying a three-day visit to 
Gjirokastra.  The Ambassador gave a Cultural Diversity award to 
group of minority dancers from southern Albania.  Overall, the 
festival highlights Albania's rich cultural traditions, showcasing 
the best in Albanian folk music, art and costumes, with performances 
both within the beautiful Castle of Gjirokastra as well as on the 
city's famous cobbled streets. 
 
 
Quote of the Week 
----------------- 
 
¶12.  "...The time when Albania decided, based on what one person or 
another said, has ended. . .  Democracy, freedom of speech, freedom 
of property are all things that the internationals taught us 20 
years ago, and now they are also owned by Albanians; therefore, we 
won't be influenced by expressions, requests, or ultimatums, no 
matter where they come from." Socialist Party National Assembly 
Chair, Gramoz Ruci, responding to calls by several foreign 
ambassadors in Tirana on the opposition to end its boycott of 
Parliament. 
 
WITHERS