28th May 2023, Skopje – Development bonds for citizens are a risk-free investment, generating earnings for the citizens, protecting the value of their savings against inflation effects and safeguarding their portfolio. These long-term securities, which the Government will start issuing the next month, will deliver many benefits for both the citizens and the economy. They will encourage investment activity, reduce cash in circulation, which is one of the ways to eradicate grey economy, but will also contribute to the further development of the securities market in the country, Minister of Finance, Fatmir Besimi, wrote is his most recent column.
These securities’ maturity will be two years, with a minimum amount to invest of Denar 10,000, while the interest rate will be additionally set reflecting the conditions on the financial market.
“Government securities holders earn respective interest, as a compensation for their investment. Moreover, government securities are recognized to be the safest financial instruments. By investing in the new government financial instruments, the citizens will protect the value of their savings. Furthermore, pressures on consumption, hence inflationary pressures, will be thus reduced”, the Minister underlined.
He also touched upon the Financial Market Development Strategy, adopted by the Government, upon proposal by the Ministry of Finance, and designed through an inclusive process. Issuance of other new types of bonds is envisaged in the Strategy, such as development bonds – which will stimulate the financing of development projects in the country, green bonds – which will be intended for environment protection projects, as well as project bonds – which will be an alternative way of financing infrastructure-related projects.
“Investments are an integral part of economic growth. New investment instruments will boost investments, both public and private, thus accelerating the growth and the benefits it brings along, such as job creation and better living standard. Most of the new instruments are related to the implementation of major infrastructure projects, contributing to creating better living conditions in the country. The new instruments will also contribute to prudent debt management, Strategy for prudent public debt management is for the portfolio to be diversified by maturity, costs and instruments to provide for the lowest risk in terms of debt sustainability and servicing. Interest-related expenditures for the Budget will be lower with the development bonds for citizens compared to the issuance on the international financial market. This is also in support of the Government’s commitment to fiscal consolidation by reducing the financing costs and introducing other financing requirements. The benefits are multiple, and there is a lot of room for innovations on the financial market. I am confident that a sound and well-devised strategy will be a solid basis to discuss the results and the benefits of these measures”, Minister Besimi wrote.