Monday, 22 October 2018 | News today: 0

Stavrevski – I’ve got used to the criticism

There is no country in Europe where construction is in progress, and they are not even close to the Macedonian progress of 33%. That’s not by accident. It’s a result from the choice of this government, which  is forcing capital investments from the budget in all fields. Thanks to that, there is much more engagement for construction corporations as well as for hundred more small manufacturing companies.


Macedonia will rich it’s aims to increase GDP on two percents with real possibility of  excelling it. – The Minister of Finance Zoran Stavrevski declares in the interview for “Republika”. He reveals that preparations for the budget of 2014 are in final stage. Projected incomes are calculated on the basis of projected economic growth of 3,2 percents. The Minister confirms that the public purse is in good shape. Also there are good  news from the European investment bank referring to the Macedonian business. The bank until November will transfer 100 million  EUR. Stavrevski declare that in progress are investment contracts at least with six new companies.

– Temptations are bigger during times of crisis, when we need to ensure on time, retirement payment, state benefits, agricultural subventions, finances for the ambitions governmental program on capital projects as well as to keep the small budget deficit and decent public debt. Therefor, the positives as well as the negative criticism is normal. A man on this position must get used to the critics and accept them positively, as long as they are well-argued – declared the Deputy Prime Minister and Minister of Finance. He also highlighted that he has big working motivation.
– The pleasure from the positive changes in Macedonia, as well as from its reputation is very big and entirely fulfills me. – announced Stavrevski.

After the European crisis were the Macedonian economy was not immune, there is positive feedback. After the GDP increase of 2,2 percents in the firs quarter , the numbers from the second trimester are much more higher. The state statistics announced economic growth of 3,9 percents. Are these numbers optimistic sign?

Stavrevski: During the second quarter of 2013, Macedonia had economic growth of 3,9 percents, after the increase of 2,9 percents during the past quarter, which refers to the average increase of 3,4 percents in the first half of the year. Another positive sign is the progress in all fields leaded by the structural engineering. During the first quarter of the year, the industry came out from the negative zone and marked growth of 0,7 percents and in the second quarter the industrial manufacturing increase, and marked growth of 4,1 percents. Visible and invisible export marked growth of 6,8 percents, while the import increased for 2,3 percents.
This information and the positive signs for the movements in the real European sector are optimistic indicators that Macedonia will reach the projected GDP increase of 2 percents with real opportunity of its exceeding. Our expectations for the next year is bigger growth of 3,2 percents. Very important fact is that those positive movements from the real sector reflected on the unemployment, which reduced on 28,8 percents. This is the lowest unemployment rate in Macedonia from the beginning of independence till today as well as its the best indicator of the correct governmental economic politic. Do not forget, in 2006 the unemployment was 38 percents, and at the meantime we have five years of economic crisis. Therefore the reduction of unemployment on 28,8 percents is consider for most successful project of this government. This does mean that that we reached our goals. We’ll carry on with our politic and criteria for improving the investment conditions as well as for creating new workplaces, in further reduction of the unemployment which is steel on high level.

Positive trends were made by businessmen who claim that banks should reduce the pessimism and intensively to credit. Should trading banks make bigger transfers in the real sector?

Stavrevski: In terms of stable macroeconomic surroundings and settings which are referring to stepping up the economic increase, i see real possibilities for banks to direct positively their free finances in the real sector. In addition, the progressive increase of foreign requests as well as that of exportation  are referring to the Macedonian potential for strengthening the export capacities, which should be properly followed and supported by the banks.
Macedonian national bank during the last period has directed its focus on creating she pace for bigger credit support for private-sector banks.
The obligatory  reserve rate  for local currency deposits was reduced from 10 to 8 percents in order to increase the  local currency saving. As well as the banks should sort out funds from crediting the net exporters,  in order to to support the export oriented companies. Also the interest rates of national and treasury bill in this moment are on the lowest level in the history, so that banks could direct their free funds to te he private sector. All of this measurement, followed by the European economy stabilization, refers to the bank’s credit support of the private sector. It’s their turn now.

The private sector has need of finance shot. The government has no debts and it’s paying on time, but still, the companies have hunger for fresh money. You promised new credits from the European investment bank. When will arrive those 100 million EUR?

Stavrevski: During the start of the European financial crisis in 2009, our government ensured resources to the companies from the European investment bank, with favorable conditions that includes interest rate of 5,5 percents and time of payment till eight years for investments and three years for working capital. Until today 250 million EUR are provided from there ,222 millions EUR of which are used for the realization of 761 projects and opening of 4.782 new  workplaces. This means that we still have 22 million EUR on disposal from the past line, and we are expecting six more million EUR for new projects. It’s very encouraging that the effects from this measurement are resulting true the liquidity, investments and opening new workplaces. This year will be realized new credit line in an amount of 100 million EUR supporting the companies with quality credit resources and favorable payment terms.  The Ministry of finance as well as the Macedonian Bank for Development Support have started the procedure and in October we expect finalization of the negotiation and credit approval from the European Investment Bank. After this procedure, in November the companies could start sending applications for obtaining resources from this credit line.

Our economy is on good track. The forecasting of the opposition that Macedonia in six months will go into bankruptcy after the promulgation of the state budget didn’t came true. The obligations are serviced regularly. Is our public purse liquid?

Stavrevski: I’m sorry to say this, but our opposition has nonstructural approach and placing black scenarios for Macedonia. It was like this in all past years. After eight months in 2013, the Macedonian economy had reached the third best result in Europe, all the budgets obligations are paid on time and we have fourth lowest debt in Europe. Where is their announced failure? The public can say who has right on this issue.
The budget liquidity is good because during the budget planing were made analysis and it was provided financial stability with basis of real planed budget incomes as well as secured resources from international sources, under favorable circumstances. The budget regularly provides retirement pay, salaries and state benefits. As it was announced, till February 2013 93 million EUR were transferred to the economy (52 million for value-added tax return and 40 million for realized projects). International finance institutions have confirmed that Macedonia is one of the rare countries which payed off its debt.

This liquidity injection helped to many Macedonian companies having solid results in a growing economic crisis, particularly when it comes to construction companies. There is no country in Europe where construction has increased, nor a country that is close to the Macedonian  increase of 33 percent. It is not a coincidence. It is a result from the choice of this government, which is forcing capital investment from the budget in all areas. They create work not only for construction companies, but also for the hundreds of small companies that are subcontractors. With this, they saved thousands of jobs, and ensured salary for the employees in these difficult times.

Capital investments in the recent period have contributed to the revival of the economy and enabled companies to breathe easier in times of crisis.  As is their implementation, do the money ended up in the road, rail and gasification?

Stavreski: Capital expenditures in the past few years have contributed to mitigating the effects of the global recession on the Macedonian economy and the intensification of investment growth in the country. The bulk of the capital expenditures for construction and reconstruction of streets, roads and highways, investment in energy and other projects. Capital expenditure in the period January-July 2013 are 10 percent higher than the same period last year. The activities for the implementation of major infrastructure projects step up, such as the finalization of the Highway 10 Corridor and investments for reconstruction and construction of railway infrastructure. At the same time, several projects were realized to improve the infrastructure in education by building schools, gyms and playgrounds; improving the municipal infrastructure through the construction of waterworks and sanitation; and investments in health.

How is it going with the calculations and tailoring of the new budget for 2014. In fiscal strategy, it will weighs almost three thousand million  EUR?

Stavreski: Preparations  of the budget for 2014 are in its final stage, the necessary analyzes were made as well as the regular consultations with ministries and other budget users. Thereto it is taken into consideration the implementation of multi-projects and it is embedded in the medium-term budget framework. The finalization of accounts in progress, after which the budget will be followed by further government and Parliament procedure. In terms of budget size I want to emphasize that the preparation of budget revenue projections are based on projected rate of economic growth of 3.2 percent for 2014. Also significant is that there will be further capital investments growth .

Last month the Ministry of Finance cancels auctions of treasury bills. Will this help restore liquidity to the economy?

Stavreski: Issuing securities is a regular practice in all developed countries and it contributes to the development of financial markets. However, it is true that the Ministry of Finance has repeatedly canceled auctions of government securities. We constantly make analysis and we are monitoring the situation and whenever there is space we are tending to leave more money in the economy, without compromising the management of public finances and the budget. Additionally I would like to point out that the banking system in Macedonia has enough strong potential for lending, and of course that such actions will create space to increase credit support for the economy. In the past we worked on improving the structure of the portfolio of government securities in order to issue longer-term instruments, which will further affect the stability of public finances and the development of the financial market by increasing the supply of trading instruments.

Macedonia is low indebted country, public debt was 33 percent of GDP. However, we should  take care for its ability to recover. Is there a homely policy and whether citizens can sleep peacefully, are there money for returning the old debts and credits, taken long ago?

Stavreski: Government run extremely cautious policy with regard to maintaining the level of public debt. Before the crisis, when the situations in the world economy were favorable, conducted early discharge so that the 39 percent of GDP, which indebtedness was when we came into government, government debt has dropped to 24 percent, in addition to reducing the debt, were made  substantial savings on interest. This has improved the country’s image in front of the international financial institutions and lenders. If you analyze the current perspective, this move has made space amid global financial crisis, so Macedonia could have access to secure funding from foreign sources. Today public debt is 33.6 percent of GDP wherewith Macedonia is in a group of moderately indebted countries and the fourth least indebted country in Europe. The obligations of the state are regularly serviced and in that sensein  the beginning of the year was paid Eurobond as well as other obligations on the basis of bilateral and multilateral loan agreements. Confirmation of successful policy for the management of public finances comes from international financial institutions, the IMF and the World Bank.