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РECУБOРNИOКMАY
The Macedonian economy in 2016 – results, forecasts…
The economy is also
expecting a resolution
of the political crisis
The political situation influences in many ways and it influences very negatively – mostly on
the courage for new investments, regardless of whether they are domestic or foreign.
Mirche Jovanovski Ahead of the agreed early parliamen- cusations for corruption in February 2015,
tary elections for December 11, not only stays unresolved by pointing out deficien-
The author is a the parties and the citizens are anticipat- cies in the standards of governance”, this
journalist ing the future course of Macedonia, but agency notes, according to which the rat-
the businessmen as well. The long-term ing reduction had an impact and the fail-
34 political crisis already left traces in the ure to realize the fiscal goals, that is, the
economy. Although, according to the mac- increase of the debt up to 40% of the GDP
roeconomic indicators which are regularly by the end of this year, from 34 percent of
published by the State Statistical Office, at the GDP in 2012. “These indicators are far
first glance it doesn’t seem so – the gross below the average value of 51 percent of
domestic product in the first two quarters the GDP, however the debt is expected to
this year saw a growth of two i.e. 2.2 per- maintain the upward trend”, it was indi-
cent, while the industrial production in cated in the report whereby it is pointed
July increased by 5.1 percent. Still, the re- out that “the escalation of the political
duced investments, the impaired liquidity instability, even from ethnical point of
of the companies, the postponed business view, may have a significant reflection on
decisions, and the independence, have the economy and on public finance, fiscal
far-reaching consequences on the econo- impairments due to potential obligations
my. In addition, the devastating effects of and an increase of the external imbalance
the natural disasters, such as the August – with a pressure on the foreign exchange
floods, also had a negative reflection on reserves and the fixed foreign exchange
the economy, although, of course, 23 hu- rate.” On the other hand, the easing of the
man lives are the greatest loss. political tensions and the conducting of a
credible middle-term fiscal consolidation,
As a result of the political crisis, how- as a ratio between the public debt and the
ever of the increasing public debt as well, GDP, will positively affect the economy as
Fitch Ratings, one of the three great- well.
est agencies which assess the credit rat-
ing (in addition to Moody’s and Standard With the reduced credit rating, Mace-
and Poor’s), reduced the rating for Mace- donia was a step away from the desired
donia for a degree, from BB plus to BB. goal – to get the so called investment rat-
“The political crisis in Macedonia, which ing as soon as possible. The consequences
started after the occurrence of serious ac- of the fall of the credit rating would most-
How will the economy operate in conditions
of fall of the credit rating of this country?
October 2016
