21st May 2022, Skopje – Additional EUR 76 million in case new measures are needed for supporting the living standard of the citizens, as well as the companies, and additional EUR 52 million aimed at farmers, increased both pensions and wages of teachers, as well as subsidies for increasing the minimum wage. These funds have been provided under the Supplementary Budget, adopted by the Government, being presented to the public by Minister of Finance, Fatmir Besimi.
Under the Supplementary Budget, total revenues are projected in the amount of Denar 245.8 billion, being by around Denar 6.9 billion or by 2.9% higher in relation to the initial Budget projections. Total expenditures are projected in the amount of Denar 288.5 billion or by 5.9%, i.e. by around Denar 16.1 billion higher compared to the initial 2022 projections, i.e. Denar 24.2 billion as additional expenditures, Denar 4.2 billion out of which via the Pension and Disability Insurance Fund for increasing the pensions, whereby cuts have been made under the Supplementary Budget amounting to Denar 4 billion. The deficit, on the basis of such projected revenues and expenditures, is projected in the amount of Denar 42.7 billion, i.e. 5.3% of GDP.
“Additional financial support is projected in the amount of Denar 4.7 billion geared towards protecting the living standard of the citizens, as well as the companies’ liquidity amid protracted crisis on the global energy and commodities market. Fiscal buffets have been provided, thus being able to respond promptly with new measures in place, aimed at protecting the citizens and the business sector. Additional Denar 3.2 billion have been projected as subsidies for farmers, aimed at encouraging the generation of returns and cushioning the price pressures of commodities. At the same time, higher transfers to LGUs have been projected, geared towards increasing the wages for the staff in the kindergartens, as well as the employees in the primary and secondary schools, by 15% starting September 2022. Pensions are additionally increased, as per the new Pension Calculation Methodology. Funds are projected for the Wage Increase Subsidy Program, Besimi said.
Capital expenditures are projected in the amount of Denar 32.2 billion or by around Denar 6 billion lower compared to the 2022 projections. However, this amount is by Denar 8.8 billion higher compared to last year, or by Denar 16.1 billion i.e. twice higher compared to 2020.
Minister pointed out that budget funds have been projected for substantial investments in the field of road infrastructure, Corridor 8: Tetovo-Gostivar highway extension, construction of new Highway Trebenishta- Struga- Kjafasan, construction of Gostivar-Bukojcani, sections Rankovce-Kriva Palanka and Kriva Palanka – Bulgarian border, as well as western part of road Corridor 8 by constructing the highway sections Kichevo – Bukojchani and Kichevo – Ohrid. Section Prilep – Bitola is also planned to be constructed along Corridor 10. In addition, Public Enterprise for State Roads will prepare Feasibility Study for constructing Tetovo- Prizren road. Moreover, credit funds have been envisaged for constructing the
highway section Skopje- Blace (border with Kosovo), improvement of the road infrastructure in the municipalities in the Republic of North Macedonia through the Local Roads Connectivity Project.
As regards railway infrastructure, it is planned to finance the three phases of the construction and rehabilitation of the eastern part of Railway – Corridor VIII, as well as the Railway Corridor VIII Project – Kicevo – Border with Albania. Construction of “Tabanovce” joint border station with accompanying facilities between the Republic of North Macedonia and the Republic of Serbia is planned as well.
Regarding gasification, construction of national gas pipelines, Skopje-Tetovo section, Gostivar-Kicevo section and Sveti Nikole-Veles section is envisaged, as well as construction of gas interconnection pipelines between the Republic of North Macedonia and the Republic of Kosovo, between the Republic of North Macedonia and the Republic of Serbia, as well as between the Republic of North Macedonia and the Republic of Greece.
Minister Besimi pointed out that several major capital projects are envisaged, pertaining to environmental protection, health and education.
Deficit and repayment of external debt and domestic debt amounting to Denar 11.8 billion, or total of Denar 54.5 billion, will be financed via borrowing on the international and the domestic market. Given the ongoing economic and foreign and political developments, this year, greater focus will be placed on financing via the international markets. Such commitment will provide for more funds from the domestic banking sector to be intended for Macedonian economy, whereby, the country’s foreign currency reserves will be additionally increased via the foreign financing sources.
This year’s economic growth is projected at 3.2% in line with the IMF projections, with the inflation rate being projected at 7.2% in 2022. Number of employed is projected to increase by 1.6%, which will contribute for the average employment rate to increase to 47.9% and bring the unemployment rate down to 14.5%. Average net wage is expected to grow rapidly, being projected at 11% in 2022.
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