Government Approves €110 Million in German Agreements, Details 7,000-Home Housing Plan

The Newsroom

The Council of Ministers approved three financing agreements with Germany, gave further details of a housing plan covering 7,000 households and extended the government’s “Prania Besnike” public-reception initiative to ministers, at a cabinet meeting on Friday morning. Ministers briefed the press afterwards; the government itself published no consolidated readout.

German financing
Infrastructure and Energy Minister Enea Karakaçi said the three agreements with the German government total €110 million, of which €20 million is grant. The remaining €90 million is loan financing. The loan terms and repayment conditions were not disclosed at Friday’s briefing.

The agreements had been signed on 3 August by Karakaçi and German Ambassador Karl Bergner, with financing channelled through Germany’s KfW development bank. At the signing, the package was reported at approximately €114 million — €90 million in loans and €24 million in grants, the grant component earmarked for the dormitory rehabilitation. Karakaçi on Friday gave the total as €110 million, including €20 million in grants. No explanation for the €4 million difference was offered at the briefing; at least one outlet had already carried both figures on the day of signing.

The funds are earmarked for three projects: continued rehabilitation of student dormitories, rehabilitation of the Vau i Dejës hydropower plant, and digitalisation of the transmission system operator. Karakaçi referred to Vau i Dejës as a “termocentral” (thermal plant) in his remarks; it is a hydropower plant on the Drin.

He also said two licensing programmes for solar water-heating panels have been completed and that the energy efficiency law is being amended to create an energy efficiency fund offering support to households and businesses. No fund size or launch date was given.

Housing programme
Economy Minister Delina Ibrahimaj returned to the national housing programme presented by the government on Thursday, giving further details after the cabinet meeting. The scheme is intended for 2027 and has not yet completed the legislative or budgetary process; the government says it requires a new law, public consultation and financing through the 2027 budget.

For 2027, the government says the two principal schemes will cover 7,000 households: 4,000 through subsidised home-purchase loans and 3,000 through rent support for professionals who have recently finished their studies. Of the 4,000 loans, 2,000 will carry zero interest for properties below €60,000 and another 2,000 a fixed 3% rate for properties above that threshold, with the interest differential covered by the National Housing Fund. Ibrahimaj described the reform as extending beyond “categories in need.”

The government also intends to build residential blocks split 30% social housing, 40% for middle-income buyers and 30% for sale on the open market. Ibrahimaj cited apartments available at €60,000 on the periphery of Tirana, “certainly not with large surface areas.”

She listed prior measures — rent bonuses, soft home loans, 300 soft loans for public administration employees announced several weeks ago, and a housing-conditions improvement programme announced on Thursday, which she said municipalities had repeatedly requested.

The briefing did not include the programme’s overall cost, the capitalisation of the National Housing Fund, eligibility criteria, an implementation timeline or detailed implementation arrangements for the 7,000 beneficiaries.

Fuel prices and subsidies
Ibrahimaj said the conflict in the Middle East is expected to last and described the Transparency Board as an instrument for short periods intended to prevent abuse. The government decided to continue the subsidy for the Transport Association and will publish a price overview for consumers. She said the IMF had advised that such interventions remain temporary, and that food and transport subsidies exist for citizens unable to absorb the costs.

“Prania Besnike” and the day’s political questions
Minister of State for Relations with Parliament Eriona Ismaili announced that from next Friday “Prania Besnike” — the government’s programme of scheduled citizen reception hours — will extend to ministers, who will publish calendars for receiving the public.

Ismaili took three political questions.

On Belinda Balluku, whose second villa was sequestered this week and who now faces an added charge of failing to declare assets, Ismaili was asked whether the majority would vote in favour if SPAK returned to parliament with a new request opening the way to her arrest. “The will to vote for or against a decision is the right of every MP; each judges for themselves how they will vote,” she said, adding that justice “has at no moment been obstructed” and that SPAK is conducting its investigations. She declined to say how MPs would vote.

On the audio recording released by former deputy prime minister Arben Ahmetaj and the accompanying arms-trafficking allegations, Ismaili refused to address the substance. “It disgusts me to answer the declarations of fugitives from the justice of the Republic of Albania,” she said, calling on Ahmetaj to “find the courage to come and face Albanian justice” as he had found “the courage to throw sludge on projects of the Albanian government.”

On Democratic Party claims that Prime Minister Edi Rama travels in a car worth €100,000, Ismaili said the vehicle is rented and paid from the Socialist Party budget, a request she said the prime minister had made “with added concern,” and that it is also used for party activities. Its specifications, she said, are a security matter “oriented by the Garda.”

The prime minister did not brief the press. The reshuffle at the Interior Ministry, decided the same day, was handled separately.