Foreign Investors Shun “Macedonia”
Skopje | 08 October 2009 | Sinisa-Jakov Marusic
“Macedonia’s” economy is shrinking despite government’s efforts
The government is silent after the “Macedonian” National Bank, NBM, announced that foreign investment in the country has effectively collapsed.
“Macedonia” experienced a diminution of foreign investment in July, when overseas companies reaped profits while failing to contribute via new investments. Some 80 million euros exited the country in this way, NBM data shows.
“This is because of the large number of dividends payed to foreign accounts,” NBM’s Georgi Gockov told reporters.
In comparison, at the end of July 2008, the country had seen 270 million euros in foreign investments for the year. Now the figure is three times lower, data shows.
As the money pours out, local analysts are urging the government to immediately change its strategy for attracting investors.
Over the last year the government has sent promotors of investment to embassies, cut various administrative procedures and taxes and spent money advertising the country as an attractive business destination.
While making improvements in its overall business climate, the country must also work to eliminate political risks as well, analysts note. They add that the global recession is not the sole reason for the negative investment trend.
“We also have an unfavourable political situation. [The] unresolved name problem” with Greece has stalled the country’s NATO accession, Simon Avramovski, from consultancy Point Pro, explains.
Most analysts predict that the situation will not change and that, by the end of the year, “Macedonia” will have had more money pouring out than entering through investments.
Last year, “Macedonia” saw marked economic growth of more than five per cent, with around half a billion euros in foreign investments. Now, the country is officially in recession, following two consecutive quarters of negative growth.
However, the government is still convinced that the country will experience less than a one per cent drop in GDP.
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