27th September 2021, Skopje – On Tuesday, Minister of Finance, Fatmir Besimi met the representatives of the Chamber of Commerce of North Macedonia, Macedonian Chambers of Commerce of Macedonia, Chamber of Commerce of North-West Macedonia and MASIT. Meetings are part of the continuous dialogue the Ministry of Finance has with the business sector, aimed at exchanging opinions and undertaking measures so as to create better business conditions and attain accelerated growth.
What was presented during the meetings were the recommendations stemming from the Conference the Ministry of Finance organized under the Skopje Economic Finance Forum, which should be adopted by the Government, being part of the Growth Acceleration Financing Plan in the final preparatory stage within the Ministry of Finance, which was also discussed therein.
-To the end of the commitments to fiscal decentralization, as well as the commitments to double the economic growth and achieve higher annual GDP growth rates by around 5%, Ministry of Finance is in the final stage of preparing the Growth Acceleration Financing Plan. The Plan addresses the new ways of access to capital to finance the recovery and the acceleration of the economic growth through projects in both the public and the private sector, Minister of Finance stated before the businessmen.
He went on that the purpose of the Plan is to scale up the total investments in the economy, thereby staying on the set path to reduce the fiscal deficit, thus maintaining stable debt level.
– 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 around EUR 4 billion for the period 2022-2026 financed from the Budget, IPA funds and by international financial institutions, much more funds and investments from the private sector to be mobilized. Thus, total investments will be increased, growth of GDP and job creation will be both accelerated, Minister underlined.
The Plan involves establishment of development funds, innovation support funds, guarantee funds, development and project bonds, 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 place, to be coupled with financing private sector projects.
Growth Acceleration Financing Plan will support public and private sector projects aimed at improving the competitiveness of the economy and the quality of life, i.e. covering areas such as environment, digitalization, innovations, human capital and social inclusion. Development Bank, Innovation and Technological Development Fund, Directorate for Technological Industrial Development Zones and other institutions, as well as commercial banks and investment funds, will be implementing agents.
-Purpose and expected results of the Growth Acceleration Financing Plan is financing the recovery of the economy hit by COVID-19 induced crisis and supporting an accelerated and sustainable growth, thereby maintaining fiscal stability by mobilizing private sector capital, in addition to the allocated budget funds. On the medium term, expected results therefrom are the following: doubled economic growth from the average growth rate of 2.5% in the past 10 years to 5% growth rates; scaled-up investments in public infrastructure and private sector through mechanism for multiplying funds with private, in addition to public sources of financing, maintaining fiscal stability within the Maastricht Criteria on government debt and government budget deficit. Accordingly, investments and accelerated growth dynamics will contribute to boosted job creation and improved standard and quality of the life of citizens, Minister Besimi stressed at the meetings with the business community, mentioning thereby that this year’s GDP growth is projected at 4.1%, however, given the economic trends and the attained GDP growth of 13.1% in the second quarter indicate that it might exceed the projected level. In the upcoming years, economic growth is expected to intensify, i.e. to get back to the pre-crisis level in 2021 and to record further gradual acceleration.
In addition to the Growth Acceleration Financing Plan, draft measures geared towards fiscal consolidation and support of the growth and the development, as well as the new Economic Reform Program, are being finalized as well.