20th May 2021, Skopje – The economy is recovering, economic policies are needed to accelerate the recovery and, subsequently, the economic growth. By including the scientific community in their creation, synergy of proper solutions can be achieved, which will provide for growth acceleration, Minister of Finance, Fatmir Besimi, said at the press conference held on the occasion of the first joint scientific conference of the Ministry of Finance and the Macedonian Academy of Sciences and Arts. At the press conference held together with the Academician Taki Fiti, the Minister pointed out that for the purpose of financing the growth, as well as continuing the commitments to fiscal consolidation, Ministry of Finance, on the basis of a special plan, will find new financing mechanisms, aimed at maintaining macroeconomic stability.
– It is certain that out economy has started to recover. Such conclusion of the economy already commencing the recovery process was also noted by the IMF Staff Visit yesterday. Export in the first quarter experienced 18% increase, while import grew by 14.1%. External trade in March, compared to last year, registered high increase of 35.5%, while export grew by 36.7%. In March, industrial production experienced higher increase of 7.6% for the first time since the pandemic outbreak, with manufacturing picking up by 6.2%. In April, business entities’ expectations in terms of increased production volume, volume of production orders and reduced stock of finished goods, also improved. Utilization of production capacities picks up as well, with 71.7% utilization in April, being at the same level as before the crisis. In March, credits to both households and corporate sector grew by 5.2% annually, with deposits increasing by 7.4%. Budget execution can also provide a good overview of the economic condition and trends. According to the most recent available data, i.e. since the beginning of this year by 18th May inclusive, total revenues were higher by 13.4% compared to last year, while revenues collected on the basis of taxes and contributions surging by 14.3%, Besimi said.
He underlined that economic recovery and, subsequently, growth acceleration require support to the business sector and investments in major projects, at the same time maintaining the gradual fiscal consolidation policy.
-Growth Acceleration Financing Plan will be the response to the challenge of financing accelerated economic growth, at the same time maintaining the medium-term fiscal consolidation plan. The essence of the Plan is to produce a multiplying effect by creating and using new mechanisms, instruments, funds and sources of financing, i.e. in addition to the planned public investments amounting to EUR 4 billion for the period 2021-2025, much more funds and investments from the private sector to be mobilized. The Plan involves establishment of development funds, innovation support funds, guarantee funds, equity funds, venture capital funds and similar instruments for support of export-oriented companies, small- and medium-sized enterprises, as well as social enterprises. Public–private partnerships, concessions and other instruments for financing public capital projects are also planned to be put into places, to be coupled with financing private sector projects, Besimi said.
Academician Fiti underlined that the topics to be discussed at the scientific conference tackle particularly important issues, as well as issues such as the fiscal challenges in the post-crisis period – structural changes, public investments and green growth, public debt management and sustainability of public finance, fiscal consolidation, fiscal capacity of local government units, etc.
-Holding such important Conference is the first substantial step towards realizing and implementing the obligations arising from the Memorandum of Cooperation signed between MASA and the Ministry of Finance. MASA has supported and will continue supporting such type of cooperation, which is in line with one of the key functions and roles of the Academy – advisory function, i.e. research and preparation of science-based recommendations and suggestions for the policy makers in different areas – in this case, public finance area. MASA welcomes the readiness of the Ministry of Finance, when debating such important topics, to also hear the voice of the science, Academician Fiti said.
Ministry of Finance and MASA have organized a joint scientific conference for the first time. The Conference topic is “Fiscal Policy Challenges amid COVID-19 Pandemic and Post-Crisis Perspectives”, it is attended by more than 30 eminent economists (academicians and professors – among which several former Ministers of Finance, present Governor), as well as IMF, WB and EC representatives. All scientific papers from the Conference will be published in a conference proceeding, to be available to the public.
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