16th November 2024, Skopje – Hungarian Loan Facility funds intended for companies are of key importance and are to be made available as soon as possible, having in mind the companies’ corresponding interest in the respective funds. Criteria should be determined with the banks on the meeting on Sunday. Failing to do so, making funds directly available through the Development Bank could be taken into consideration, Deputy Minister of Finance, Nikolche Jankulovski, highlighted during the Financing and Budget Commission’s general debate regarding 2025 Draft Budget.
“Funds play a major role with them being intended for production companies investing in manufacturing and creating added value. This would lead towards market placement and sale of the respective manufactured products, alongside an increase in employment, thus raising the bar of competitiveness, according to our belief. In addition to having an efficient economic growth, we are to have wage increase owing to the market mechanisms”, Jankulovski underlined.
The interest rate amount to be subsidized by the Government will be determined at the meeting among the Prime Minister, the competent authorities and the Macedonian Banking Association, considering that subsidizing the interest rate by the Government, was also a practice applied in the past, as Deputy Minister pointed out.
He emphasized the companies’ everyday inquiry relating to these funds, in particular the three-year grace period during which only the interest, not the principal, will be paid.
“This will mean a lot to them. They will invest in their manufacturing process, expecting the results in the first two to three years, and starting to repay the principal and the interest in the fourth year. The extent of the country’s support and the bankers’ demands will be known on Sunday, whereby we will also be considering the previous Government practice. The objective is to use these funds as much as possible, and I am confident they will be used to their full extent. Should no agreement be reached, there is always the possibility for the funds to be made available through the Development Bank, by the Bank engaging additional staff. Whichever solution is being chosen, I would like for the issue to be resolved as quickly as possible. The quicker funds are injected into the economy, the better for the state, regardless of which planning region is concerned”, Nikoloski said.
He pointed out that more funds for the support of the economy are envisaged in the 2025 Draft Budget: Denar 3.7 billion (increased from Denar 1.4 billion) for attracting foreign direct investments and development of free economic zones and foreign companies, Denar 2.4 billion (increased from Denar 1.1 billion) for financial support to the domestic companies. Support extended via the Invest North Macedonia is increased from Denar 4.4 billion to Denar 6.2 billion. Amount of Denar 2.3 billion is being projected for active employment measures, whereas for this year Denar 1.9 billion has been projected for this particular purpose.
“All this speaks of the Government’s commitment and support to the companies, and the Government’s expectations regarding the input of the companies towards future economic growth of Republic of Macedonia”, Deputy Minister of Finance indicated.
As per the support of balanced regional development, EUR 1 billion is projected for municipal support, all to the aim of their sound development.
“These funds are intended for many projects. Since, there are municipalities with no water supply and sewerage system, population size has been taken as criterion under the first call for allocation of funds intended for the municipalities with the Hungarian Loan Facility. For instance, in the municipality of Mogila, funds will be allocated to villages with no existing water supply systems. We cannot introduce any other criteria to allocate the funds until sorting out key infrastructure issues”, Jankulovski pointed out.
In addition, the eight planning regions are being additionally supported by the Central Budget through the Balanced Regional Development Bureau, with funds being allocated as per the agreement among the mayors in the respective planning regions.
“This is”, Jankulovski underlined, “a considerable input, provided to the municipalities in order to improve the everyday life of their citizens”.
The Draft Budget’s Commission debate began on 14th November, and it may last up to ten working days.
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