IDEAS home Printed from https://ideas.repec.org/a/eur/ejesjr/59.html
   My bibliography  Save this article

Lack of Credit in Albania; Who is to “Blame†Analyzing the Demand

Author

Listed:
  • Eugen Musta
  • Elvin Meka

Abstract

The last global crisis had it influence on Albanian economy as well. As the economy is still struggling to recover from the slowdown, a special attention is dedicated to lending which will in turn help investments pick up. Banks in Albania are currently flooding in excess deposits, but meanwhile the lending has hit its lowest score. What is refraining banks from lending? Is it really them to blame or maybe the demand is also part of the problem? Are businesses suffering from lack of funds to finance their activity or are they hesitating to invest and are waiting for better times to come along? The purpose of this study is to look into these questions and find the reasons behind them. This paper is focused on the demand side, analyzing some of the most important indicators influencing the demand for credit like enterprises growth, profits, planned investments, working capital needs, liquidity, etc. In order to get better understanding on the behavior of these variables the enterprises are divided in four groups by size criteria. The analysis is covering data for five-year timeframe, which is corresponding with the start of the economic slowdown. To help getting a prospect of the present and the future perceptions of the economic situation, a survey was conducted on a small sample of enterprises. This study comes to the conclusion that the demand for credit is growing, but what’s keeping businesses from applying for it, is mainly because of high interest rates and cost of credit, the study ends with some recommendations toward the solution.

Suggested Citation

  • Eugen Musta & Elvin Meka, 2015. "Lack of Credit in Albania; Who is to “Blame†Analyzing the Demand," European Journal of Economics and Business Studies Articles, Revistia Research and Publishing, vol. 1, ejes_v1_i.
  • Handle: RePEc:eur:ejesjr:59
    DOI: 10.26417/ejes.v3i1.p122-132
    as

    Download full text from publisher

    File URL: https://brucol.be/index.php/ejes/article/view/5265
    Download Restriction: no

    File URL: https://brucol.be/files/articles/ejes_v1_i3_15/Eugen.pdf
    Download Restriction: no

    File URL: https://libkey.io/10.26417/ejes.v3i1.p122-132?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. ., 2013. "The Global Entrepreneurship and Development Index," Chapters, in: Global Entrepreneurship and Development Index 2013, chapter 4, pages iii-iii, Edward Elgar Publishing.
    2. Zhllima, Edvin & Viaggi, Davide & Müller, Daniel, 2010. "Property rights to land and its perception in rural part of central Albania," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 9(3), pages 56-64.
    3. ., 2013. "Entrepreneurs, firms, and global wealth since 1850," Chapters, in: Entrepreneurship and Multinationals, chapter 2, pages 13-56, Edward Elgar Publishing.
    4. ., 2013. "Entrepreneurship in post- conflict Iraq," Chapters, in: The Political Economy of Iraq, chapter 10, pages 183-208, Edward Elgar Publishing.
    5. Wheeler, Rachel, 1998. "Past And Present Land Tenure Systems In Albania: Patrilineal, Patriarchal, Family-Centered," Working Papers 12781, University of Wisconsin-Madison, Land Tenure Center.
    6. ., 2013. "The role of entrepreneurship in economic development," Chapters, in: Global Entrepreneurship and Development Index 2013, chapter 5, pages iii-iii, Edward Elgar Publishing.
    7. ., 2013. "Markets, competition and entrepreneurship," Chapters, in: The Rediscovery of Classical Economics, chapter 6, Edward Elgar Publishing.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Patricia Kotnik & Rok Stritar, 2015. "ICT as the Facilitator of Entrepreneurial Activity: An Empirical Investigation," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 17(38), pages 277-277, February.
    2. Gusciute, Egle & Quinn, Emma & Barrett,Alan, 2015. "Business Migration to Ireland," Research Series, Economic and Social Research Institute (ESRI), number RS43.
    3. Ferrante, Francesco & Federici, Daniela & Parisi, Valentino, 2017. "University Students and Entrepreneurship. Some insights from a population-based survey," MPRA Paper 76980, University Library of Munich, Germany.
    4. Alessandro Rosiello & Dave Wield & Omid Omidvar & Michele Mastroeni & Joyce Tait, 2015. "Science and Innovation in Scotland: a Study on the Impact of Enhanced Autonomy," ERSA conference papers ersa15p1014, European Regional Science Association.
    5. Daniel S. J. Lechmann & Christoph Wunder, 2017. "The Dynamics of Solo Self-Employment: Persistence and Transition to Employership," SOEPpapers on Multidisciplinary Panel Data Research 932, DIW Berlin, The German Socio-Economic Panel (SOEP).
    6. Elert, Niklas & Henrekson, Magnus & Stenkula, Mikael, 2017. "Institutional Reform for Innovation and Entrepreneurship: An Agenda for Europe," Working Paper Series 1150, Research Institute of Industrial Economics, revised 16 Feb 2017.
    7. Martin Binder, 2017. "Entrepreneurial Success and Subjective Well-Being: Worries about the Business Explain One's Well-Being Loss from Self-Employment," SOEPpapers on Multidisciplinary Panel Data Research 947, DIW Berlin, The German Socio-Economic Panel (SOEP).
    8. Peter van der Zwan & Jolanda Hessels & Cornelius A. Rietveld, 2015. "The Pleasures and Pains of Self-Employment: A Panel Data Analysis of Satisfaction with Life, Work, and Leisure," Tinbergen Institute Discussion Papers 15-099/VII, Tinbergen Institute.
    9. Dilli, Selin & Elert, Niklas, 2016. "The Diversity of Entrepreneurial Regimes in Europe," Working Paper Series 1118, Research Institute of Industrial Economics.
    10. Akinboye Abayomi Kazeem & Soaib Asimiran, 2016. "Factors Affecting Entrepreneurial Self-efficacy of Engineering Students," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 6(11), pages 519-534, November.
    11. Triantis, Loukas, 2020. "Public land privatisation and commodification as a field of changing social relations: The making of the Albanian Riviera," Land Use Policy, Elsevier, vol. 99(C).
    12. Zhllima, Edvin & Rama, Klodjan & Imami, Drini, 2021. "Agriculture land markets in transition - The inherited challenge of the post-communist land reform in Albania," Land Use Policy, Elsevier, vol. 107(C).
    13. Wheeler, Rachel, 2000. "Legal Transfer And The Legitimation Of Law: Implications Of Farm Family Property Provisions In Albanian Legislation," Working Papers 12776, University of Wisconsin-Madison, Land Tenure Center.
    14. Akhmadiyeva, Zarema & Herzfeld, Thomas, 2021. "Understanding the Role of Perceived Land Rights in the Formation of Farmers’ Intentions: Evidence from Central Asia," 2021 Conference, August 17-31, 2021, Virtual 315076, International Association of Agricultural Economists.
    15. Huesca-Pérez, María Elena & Sheinbaum-Pardo, Claudia & Köppel, Johann, 2016. "Social implications of siting wind energy in a disadvantaged region – The case of the Isthmus of Tehuantepec, Mexico," Renewable and Sustainable Energy Reviews, Elsevier, vol. 58(C), pages 952-965.
    16. Tatsvarei, Simbarashe & Mushunje, Abbyssinia & Matsvai, Simon & Ngarava, Saul, 2018. "Farmer perceptions in Mashonaland East Province on Zimbabwe’s agricultural land rental policy," Land Use Policy, Elsevier, vol. 75(C), pages 468-477.
    17. Mathias Lerch, 2013. "Patriarchy and fertility in Albania," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 29(6), pages 133-166.
    18. Ciaian, Pavel & Rajcaniova, Miroslava & Guri, Fatmir & Zhllima, Edvin & Shahu, Edmira, 2018. "The impact of crop rotation and land fragmentation on farm productivity in Albania," Studies in Agricultural Economics, Research Institute for Agricultural Economics, vol. 120(3), December.
    19. Ebner, Julia, 2015. "The Sino–European race for Africa׳s minerals: When two quarrel a third rejoices," Resources Policy, Elsevier, vol. 43(C), pages 112-120.
    20. Kim, Sahrok & Praveen Parboteeah, K. & Cullen, John B. & Jeong, Nara, 2022. "Social institutions approach to women’s firm ownership and firm bribery activity: A study of small-sized firms in emerging markets," Journal of Business Research, Elsevier, vol. 144(C), pages 1333-1349.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eur:ejesjr:59. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Revistia Research and Publishing (email available below). General contact details of provider: https://revistia.com/index.php/ejes .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.