20th January 2024, Skopje – By being strongly committed to the implementation of the ambitious reform agenda, Republic of North Macedonia maintained the macroeconomic and financial stability, achieved all set goals, and, as per IMF staff, continues to meet the access criteria as regards the IMF Precautionary and Liquidity Line (PLL) Arrangement, granted only to those economies with sound macroeconomic fundamentals.
This is the conclusion of the IMF Mission regarding Article IV and the First Review of the Precautionary and Liquidity Line Arrangement. The completion of the review gives the authorities access to US$ 200 million within the already approved total package in the amount of EUR 530 million as part of the PLL Arrangement. First tranche amounting to EUR 110 million was disbursed in 2022, to be followed by disbursement of the second one in the amount of EUR 155 million, whereby the remaining funds are being treated as buffers in case the country is in need therefor.
“North Macedonia is recovering from the dual shocks of the COVID-19 pandemic and the surge in energy prices following Russia’s invasion of Ukraine. Economic activity in 2023 was driven by strong exports and reduced energy imports, and it is set to strengthen into 2024. The planned increase in public investment, notably the commencement of the Corridor 8/10d Road Project, will further support economic recovery. Although inflation remains a challenge, it has moderated substantially”, the IMF statement features.
IMF denotes the deficit target met by the Government in 2023. “Planned fiscal consolidation for 2024 aims to bring the budget deficit closer to the 3 percent of GDP ceiling under North Macedonia’s Organic Budget Law.”, as stated by IMF staff.
Precautionary and Liquidity Line Arrangement assists the country in resolving the uncertainties triggered by the high inflation, Russia’s invasion of Ukraine and the energy crisis, while also ensuring financial stability.
PLL is a two-year arrangement terminating in November 2024, providing the country with access to funds under favorable terms and conditions in the amount of EUR 530 million.
IMF’s Precautionary and Liquidity Line is intended for IMF member countries with sound economic fundamentals and strong records of implementation of sustainable policies. PLL was introduced in 2011.