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FEDERATION OF EURO-ASIAN STOCK EXCHANGES SEMI ANNUAL REPORT OCTOBER 2005
MACEDONIAN STOCK EXCHANGE
ECONOMIC AND POLITICAL DEVELOPMENTS
Politic and Economic Environment:
The Republic of Macedonia is a small,
mountainous Balkan country with a
population of just over two million. In 1991, it
declared its sovereignty from Yugoslavia,
and has since experienced mixed success in
liberalizing its economy. The industrial sector
comprises about 18% of GDP and employs
about one-third of those holding jobs in the
formal economy. The largest components of
industrial production are metals, chemicals
and food and beverage processing. The
privatization process is almost finished and
the country has adopted a market economic
system. The primary goals of the country are
accession to the EU and NATO and on this
issue is boosted by a wide consensus of all
Macedonian political factors.
The President of the Republic of Macedonia
is Mr. Branko Crvenkovski. Prime minister of
the Government is Mr. Vlado Buckovski.
Key Information Contacts
Central Securities Depository www.cdhv.org.mk
Securities & Exchange Commission www.sec.gov.mk
National Bank of the Republic of Macedonia www.nbrm.gov.mk
Ministry of Finance www.fin.gov.mk
ECONOMIC RATIOS
Domestic
savings
PAGE 102
Macedonia
Lower-middle-income group
Trade
Indebtedness
Investment
Economic Performance:
In March 2004, the Republic of Macedonia
submitted a formal application for candidacy
of accession into the European Union (EU),
fiscal, monetary, and structural actions will
be tailored toward this goal. The EU
questionnaire has been answered and the
government awaits the decision of the
European Commission for the candidatestate
status by October 2005. The current
account deficit is driven by a large deficit on
merchandise trade, and by service
transactions with the rest of the world that
result in net payments to foreigners.
GROWTH OF INVESTMENT AND GDP
(%)
15
10
5
0
-5
-10
-15
97
GDI GDP
2002 2003 2004
Real GDP growth 0.9% 3.2% 2.9% (estimated)
Industrial production growth -5.3% 4.7% -12.7%
Inflation rate 1.8% 1.2% -0.4%
External debt US$ 1,548 million US$ 1,770 million US$ 1,957 million
Domestic debt US$ 647 million US$ 729 million US$ 788 million
Foreign currency reserves US$ 734 million US$ 903 million US$ 985 million
Foreign direct investments US$ 78 million 95 million US$ 140 million
(as of XII 2004)
Export US$ 1,113 million US$ 1,359 million 1,673 million
Import US$ 1,878 million US$ 2,211 million US$ 2,903 million
Macedonia's current account deficit, unlike
many poorer transitioning countries, is not
financed primarily by loans from multilateral
agencies like the World Bank, European
Development Bank and IMF. Rather, portfolio
investment, associated with privatization
activities, has financed the largest portion of
the current account gap. From the beginning
2004 the Government has started issuing
treasury bills, also planning to issue
government bonds in the future. In August
2005 Macedonia has been given its new
credit rating marks from the
Standard&Poor’s, which are BB- for the
domestic debt and BBB+ for the external
debt.
98 99 00 01 02 03
* World Bank reports