27th May 2020, Skopje – Republic of North Macedonia issued the seventh Eurobond in the amount of EUR 700 million. The maturity of the Eurobond is 6 years, while the interest rate at which it was issued accounts for 3,675%, being the second lowest interest rate, right after the Eurobond issued in 2018. This speaks in favour of the confidence of investors in the Macedonian economy and politics, given that this bond is issued during a Covid-19 crisis – the worst economic crisis since the Great Depression, when all economies, including the developed economies, approached the international capital market capital so to provide resources for financing the crisis-related needs.
In addition, the demand volume of foreign investors for the Eurobond was by 5 times higher than the amount issued. This is another fact, in addition to the favorable interest rate, which indicates a good positioning at the foreign investors and their confidence in the country. This is due to the macroeconomic and financial stability, as well as our commitment and success achieved in recent years with respect to the Euro-Atlantic integration.
By issuing the Eurobond, and given the IMF loan amounting to EUR 176 million, as well as the loans from the World Bank and the EU amounting to EUR 140 million and EUR 160 million respectively, being still negotiated but which are certain, full coverage of the financial needs for this year has been provided, together with the projected deficit projected at 6.8% of GDP under the Supplementary Budget and the debt liabilities maturing throughout the year, amounting to EUR 705 million. In addition, cash buffer has been provided aimed at dealing with any potential repeated shock and depending on the developments, partial financing of the needs for next year.
This country has issued 7 Eurobonds on the international capital market so far, including the Eurobond issued today. The first Eurobond was issued in 2005, followed by the Eurobonds issued in 2009, 2014, 2015, 2016, 2018 and the most recent one in 2020. The 2018 Eurobond had the lowest interest rate accounting for 2.75%, while the highest one was in 2009, accounting for of 9.875%, however, it must be noted that it was issued during a global financial crisis.
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