Analysis 14 Jul 16

Prolonged Crisis Takes Toll on Macedonia’s Economy

The unending political crisis in Macedonia is damaging the economy, slowing economic growth, deterring foreign investors and increasing the public debt.

Sinisa Jakov Marusic
BIRN
Skopje
Photo by: MIA

Macedonia’s economy will suffer a marked blow from the prolonged political crisis that escalated in 2015 and then again this year, economic experts say.

The consequences can already be seen in the continued fall in foreign investments, in companies struggling to maintain profits or break even and in an increase in debt as the government tries to cover the budget gap.

With another intensification of the crisis in May, sparked by President Gjorge Ivanov’s decision, later retracted, to pardon top-ranking politicians facing serious criminal allegations, observers fear the negative effects on the economy will worsen in the second half of this year.

The political instability “is reflected directly on the economy, which we feel each day as the situation gets from bad to worse,” Mendres Kuci, from the Economic Chamber of Western Macedonia, told BIRN.

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