Albania’s credit rating upgraded by S&P, reflecting stronger fiscal position

The global ratings agency Standard & Poor’s has upgraded Albania’s long-term credit rating from ‘BB-’ to ‘BB’ with a stable outlook. This marks the second upward revision within a year and signals growing investor confidence in the country’s fiscal management.

Why is this important: Credit ratings are closely monitored by international investors, financial institutions, and development partners. The upgrade is expected to improve Albania’s access to international financing and reduce borrowing costs, while also strengthening its macroeconomic credibility ahead of the May 2025 parliamentary elections.

Context: S&P attributes the improved rating to a combination of strong foreign direct investment, remittances, and a booming services export sector. “High net FDI, remittances, and rapid growth in services exports support Albania’s stable economic outlook, despite heightened geopolitical tensions and uncertainties ahead of the parliamentary elections,” the agency wrote in its report.

Albania’s real GDP growth is projected to remain above 3% through 2028, driven by investment and private consumption. Meanwhile, public debt has steadily declined, from 65.7% of GDP in 2019 to an estimated 55.4% in 2024. By 2028, S&P forecasts debt levels will drop further to 51.7%.

What else: Prime Minister Edi Rama welcomed the news as a clear signal of Albania’s continued economic progress. “This upgrade confirms, from yet another perspective, the unstoppable progress Albania is making,” he said in a public statement, describing S&P’s assessment as “a very good piece of news.”

S&P’s rating decisions are closely watched benchmarks in global markets, helping guide investment decisions and shaping perceptions of a country’s economic and political stability.