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flag FYROM FYROM: Economic and Political Outline

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

FYROM is the poorest of the former Yugoslavian republics. After a period of transition, the economy experienced more continuous growth between 2004 and 2008 (5% on average annually), driven by domestic consumption and exports (especially metals and textile products). The country experienced a recession in 2009 (-0.9% of GDP) but a moderate growth has been back since then. In 2013, growth reached 2.2% (in comparison to 2% in 2012), with forecast at 2.5% for 2014.

The industrial infrastructures inherited from Yugoslavia have profited of very few investments. Even though the country has a skilled and competitive labor force, job opportunities are insufficient. The official unemployment rate was more than 28.8% in 2013 (against 31.2% in 2012). Inflation is under control (2.8% in 2013). FYROM has a considerable unofficial economy which represents about 35% of its GDP. Public account deficits are worsening since 2012.

The need for international recognition and the continuing uncertainty at both regional and European levels prompted the authorities to seek IMF assistance. In January 2011, the country became the first to receive a Precautionary Credit Line (PCL) for a total of EUR 476 million over two years, due to the stability of its macroeconomic fundamentals: limited budget deficit, targeting exchange rates, contained inflation, low public debt and bank stability). FYROM has also been a target site for European (IPA) and international funding (World Bank, EBRD).

The main concern for 2014 is the persistence of the budget deficit, which is likely to decrease due to higher imports contained by modest growth and a tight fiscal policy.

WTO member since March 2003, the country has, since December 2005, been the official candidate to EU accession. The negotiation process is however blocked by its dispute with Greece over the name of the country.

 
Main Indicators 20112012201320142015 (e)
GDP (billions USD) 10.569.5910.2110.9211.83
GDP (Constant Prices, Annual % Change) 2.8-0.42.93.4e3.6
GDP per Capita (USD) 5,1224,63845,2625,688
General Government Gross Debt (in % of GDP) 27.933.435.9e36.337.5
Inflation Rate (%) 3.93.32.81.0e1.5
Unemployment Rate (% of the Labor Force) 31.431.330.029.028.0
Current Account (billions USD) -0.27-0.29-0.20-0.50-0.67
Current Account (in % of GDP) -2.5-3.0-1.9e-4.6-5.7

Source: IMF - World Economic Outlook Database , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

FYROM has, in its majority, an agricultural economy.  The agricultural sector represents 11.1% of its GDP and employs 20% of its active population. It mainly produces rice, cotton, tobacco and fruits. Sheep and goat breeding is equally important. There are a few deposits of iron, copper and lead in the country.

The industrial sector includes chemical products, steel, machinery and textiles. The textile sector constitutes the main industry of the country, notably the leather industry.  Both, the manufacturing and the mining sectors have contributed 27.1% to the GDP in 2013.

The tertiary sector represents 61.8% of the GDP and employs 58% of the active population. The main income sources come from transport, telecommunications and energy production.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 17.3 29.9 52.8
Value Added (in % of GDP) 10.4 26.2 63.4
Value Added (Annual % Change) 0.5 10.2 -0.2

Source: World Bank - Last Available Data.

 
 
 
Monetary Indicators 20092010201120122013
FYROM Denar (MKD) - Average Annual Exchange Rate For 1 USD 44.1046.4944.2347.8946.40

Source: World Bank - Last Available Data.

 
 

Learn more about Market Analyses about FYROM on Globaltrade.net, the Directory for International Trade Service Providers.

Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
68.6/100
Position:
Moderately Free
World Rank:
43/178
Regional Rank:
20/43

Distribution of Economic freedom in the world
Source: 2014 Index of Economic freedom, Heritage Foundation

 
 

Country Risk

See the country risk analysis provided by Coface.

 

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Foreign Trade in Figures

FYROM is an open economy, highly integrated into the international trade, with a total trade-to-GDP ratio of over 100%. It became a member of WTO (World Trade Organization) in April 2003. Following a cooperation agreement with the EU, FYROM signed a Stabilization and Association Agreement in April 2001, which concedes the country duty-free access to European markets. Lastly, since 2006 the country is also a member of the Central European Free Trade Agreement (CEFTA), generally considered as the antechamber of the EU.

The EU is the first trade partner of the country. Its main customers in 2013 have been Serbia, Germany, but also Italy, Bulgaria and Kosovo. FYROM main exports are clothing, textiles, iron, steel, (these 4 sectors representing 40% of export in 2013) but also shoes and tobacco.

Its main suppliers are Germany, Russia, Greece, Serbia and Italy. FYROM mainly imports hydrocarbons, iron and steel, machinery, and food.

Due to the effects of the crisis, the country's trade deficit became deeper with a slow down in export but also because the money transfers from the population living abroad - which partly financed this imbalance -  were greatly reduced.

 
Foreign Trade Indicators 20092010201120122013
Imports of Goods (million USD) 5,0435,4747,0076,5116,600
Exports of Goods (million USD) 2,6923,3514,4554,0024,267
Imports of Services (million USD) 7898179379601,015
Exports of Services (million USD) 8458871,0961,0461,157
Imports of Goods and Services (Annual % Change) -14.39.514.14.2-2.1
Exports of Goods and Services (Annual % Change) -15.823.611.30.04.5
Imports of Goods and Services (in % of GDP) 61.065.374.576.372.8
Exports of Goods and Services (in % of GDP) 39.246.654.953.653.9
Trade Balance (million USD) -2,422-2,032-2,642-2,584-2,468
Trade Balance (Including Service) (million USD) -2,137-1,857-2,140-2,193-1,987
Foreign Trade (in % of GDP) 100.2111.8129.3129.9126.7

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2013
Germany 35.9%
Serbia 12.8%
Bulgaria 7.6%
Italy 6.5%
Greece 5.0%
See More Countries 32.2%
Main Suppliers
(% of Imports)
2013
United Kingdom 11.0%
Greece 10.6%
Germany 10.5%
Serbia 8.4%
Italy 6.5%
See More Countries 53.0%

Source: Comtrade, Last Available Data

 
 

Main Products

- bn USD of products exported in 2013
Reaction initiators, reaction accelerators and...Reaction initiators, reaction accelerators and catalytic preparations, n.e.s. (excl. rubber accelerators) 15.0%
Ferro-alloysFerro-alloys 10.0%
Centrifuges, incl. centrifugal dryers (excl. those...Centrifuges, incl. centrifugal dryers (excl. those for isotope separation); filtering or purifying machinery and apparatus, for liquids or gases; parts thereof (excl. artificial kidneys) 6.3%
Women's or girls' suits, ensembles, jackets,...Women's or girls' suits, ensembles, jackets, blazers, dresses, skirts, divided skirts, trousers, bib and brace overalls, breeches and shorts (excl. knitted or crocheted, wind-jackets and similar articles, slips, petticoats and panties, track suits, ski suits and swimwear) 3.7%
Unmanufactured tobacco; tobacco refuseUnmanufactured tobacco; tobacco refuse 3.6%
See More Products 61.5%
- bn USD of products imported in 2013
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 10.1%
Platinum, incl. palladium, rhodium, iridium,...Platinum, incl. palladium, rhodium, iridium, osmium and ruthenium, unwrought or in semi-manufactured forms, or in powder form 7.9%
Flat-rolled products of iron or non-alloy steel,...Flat-rolled products of iron or non-alloy steel, of a width >= 600 mm, hot-rolled, not clad, plated or coated 2.6%
Electrical energyElectrical energy 2.6%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 2.1%
See More Products 74.8%

Source: Comtrade, Last Available Data

 
See More Products
More imports (Intracen Data)
More exports (Intracen Data)
 
 
 

Main Services

- bn USD of services exported in 2012
32.14%
22.95%
21.94%
7.08%
6.16%
5.49%
1.89%
0.78%
0.77%
0.54%
0.24%
- bn USD of services imported in 2012
36.73%
27.17%
10.69%
4.47%
4.01%
3.28%
3.14%
2.67%
2.64%
2.64%
2.56%

Source: Comtrade, Last Available Data

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Sources of General Economic Information

Ministries
Ministry of Finance
Ministry of Justice
Ministry of Economy
Ministry of Transportation and Communications
Ministry of Agriculture
Ministry of Education and Science
Ministry of Labor and Social Affairs
Statistical Office
National Bureau of Statistics
Central Bank
National Bank
Stock Exchange
Stock Exchange
Search Engines
Google
Mkd
Org
Economic Portals

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Political Outline

Executive Power
FYROM proclaimed its independence in 1991, at the time of the dissolution of the former Federal Social Republic of Yugoslavia. FYROM is a federal republic, its current constitution was adopted in November 20, 1991.

The executive power is formed by the president, elected by popular vote for a five-year term, and the First Minister.  The President can be reelected only once.  He appoints his First Minister who is in charge of forming the government.

Legislative Power
The legislative power is conducted by the Parliament, the central instrument of the political system.  It is unicameral and the assembly is composed of 120 members who are elected every four years by direct popular vote.
Main Political Parties
The country's main political differences are based on an ethnic level.  In fact, the political parties represent the different ethnic groups of the country: The majorities are Slavomacedonian and the minorities are Albanians.  The major political parties in the country are:
- SDSM (Social Democratic Union) – social democratic party, it is the largest one in the country, which supports a reconciliation with the Albanian minorities;
- VMRO-DPMNE (Internal Revolutionary Organization–Democratic Party for National Unity) – a Christian democratic party supporting the interests of  the ethnic Slavomacedonian majority;
- DUI (Democratic Union for Integration) – the largest party among the Albanian population;
- DPA (Democratic Party of Albanians) – an ethnic party of Albanians;
- LDP (Liberal Democratic Party) – a liberal political party.
Current Political Leaders
President: Gjorgji Ivanov (since April 2009) - VMRO-DPMNE
Prime Minister: Nikola GRUEVSKI (since August 2006) – VMRO-DPMNE
Next Election Dates
President : March 2019;
Legislative: June 2015
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
123/180
Evolution:
7 places down compared to 2013

Source: Worldwide Press Freedom Index 2014, Reporters Without Borders

 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Partly Free
Political Freedom:
3/7

Map of freedom 2014
Source: Freedom House

 

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Last Updates: October 2014