1. The Albanian economy has shown considerable resilience in the face of consecutive shocks since 2019 but is facing new challenges. Past efforts to build policy buffers and a broadly appropriate macroeconomic policy mix during 2020–21 have helped Albania withstand the earthquake and pandemic shocks. Albania’s direct exposures to Russia and Ukraine are limited (Box 1), and growth momentum has remained positive this year despite the shock to the global economy from Russia’s war against Ukraine. With twin deficits and high government debt, Albania now faces challenges from soaring international food and energy prices, tighter global financial conditions which are likely to persist, and the economic slowdown in Europe. The opening of the EU accession talks in July marks an important milestone for Albania. Implementation of past Fund advice remains uneven (Annex I). Local elections are set for May 2023.