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February, 2014 EMERGING ECONOMY IN EUROPE Zoran Stavreski, MA Vice Prime Minister and Minister of Finance Viktor Mizo CEO, Free Zones Authority Macedonian Model for Improving the Business Environment

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Page 1: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

February, 2014

EMERGING ECONOMY IN EUROPE

Zoran Stavreski, MA

Vice Prime Minister and

Minister of Finance

Viktor Mizo

CEO, Free Zones Authority

Macedonian Model for Improving the Business

Environment

Page 2: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Political Stability - European Union candidate country

Candidate country since 2005

European Commission Progress Reports

consecutively (from 2009, 2010, 2011, 2012 and

2013) give recommendation to start EU accession

negotiations

Expecting date for starting negotiations for EU

membership

Republic of Macedonia: Euro-Atlantic integration

Page 3: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Key Macroeconomic Indicators

CURRENCY

Fixed exchange rate pegged to the Euro

FDI (% of GDP)

EXPORT GROWTH RATE (%)

REAL GDP GROWTH RATE (%)

INFLATION

Low and stable over last 10 years

Average inflation: 2% annually

Source: SSO and MoF; *Projection

CREDIT RATINGS

- Standard & Poor’s: BB-, Stable Outlook

- Fitch: BB+, Stable Outlook

5.0 6.1

5.0

-0.9

2.9 2.8

-0.4

3.3 3.2 3.8

2006 2007 2008 2009 2010 2011 2012 2013* 2014* 2015*

16.5 29.2

8.9

-28.2

30.9 26.9

-3.2

2.7 10.4 11.4

2006 2007 2008 2009 2010 2011 2012 2013* 2014* 2015*

6.6

8.5

6.0

2.2 2.3

4.5

1.0

3.4 4.1

4.7

2006 2007 2008 2009 2010 2011 2012 2013* 2014* 2015*

Page 4: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Financial System

Sound and stable financial system

No spillover of the world financial crisis on Macedonia

16 banks with capital adequacy ratio of 17.3%

Macedonian banks are highly liquid with credit to deposit ratio bellow 1 (0.90)

75.2% share of foreign in total bank capital

Some of the banks operating in Macedonia are:

French Societe Generale Bank

German ProCredit Bank

Austrian Sparkasse Bank

Dutch-Turkish Halk Bank

Page 5: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Invest Macedonia - Agency for Foreign Investments

Sustainable Public Finances

Total revenues

30.0% of GDP

Total expenditures

33.4% of GDP

Moderate size of Government and fiscal policy that supports economic growth

Prudent fiscal policies

Budget balance

-3.5% of GDP

General Government Debt

34.3% of GDP

As % of

GDP Total Revenues

Total

Expenditures

Budget

balance

2007 32.8 32.2 0.6

2008 33.1 34.1 -0.9

2009 31.3 33.9 -2.7

2010 30.4 32.9 -2.4

2011 29.8 32.3 -2.5

2012 30.1 34.0 -3.9

2013 28.4 32.3 -3.9

2014* 29.9 33.4 -3.5

Source: MoF; *Projection

24.0 20.6 23.8 24.2

28.0 34.1 34.3

2007 2008 2009 2010 2011 2012 2013

Central Government Debt (% of GDP)

Page 6: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

6

Lowest taxes in Europe

Lowest Flat Tax on Profit 10%

Lowest Flat Tax on Income 10%

Tax on Undistributed Profit 0%

Reduction of social contributions

Total rate of 26.5% in 2013

Pension and disability insurance 18%

Health insurance 7.3%

Unemployment insurance 1.2%

Corporate Tax is only paid when

dividends and profits are distributed,

effectively making the CT rate 0%

Social contributions have been

reduced from 32% to 26.5%

Additional incentives in the

Free Economic Zones

42+ Double taxation avoidance

treaties signed

Page 7: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

7

Regulatory reforms

One-Stop-Shop: 4 hours company registration without minimum start-up capital

Regulatory Guillotine (“silence is consent”, reduced admin.fees & time limits)

Electronic One-Stop-Shop for customs permits and licenses

Improving interoperability (exchange of information) between government

institutions, which reduces red tape and regulatory burden on companies

Cadastre reforms

New Cadastre Law

Digital Cadastre covering 99% of the real estate in Macedonia

Notaries and land surveyors have access to land register through on-line

system to obtain extracts of real estate and check for burdens and mortgages

Innovation New Law on Innovation and establishment of Fund for Innovations and

Technology Development, that will provide grants&credit to match private

investments in new technologies, finance new start-ups and spin-offs

Strategy for Innovation 2013 - 2020 covering a range of financial incentives, as

well as educational, regulatory, infrastructural and other measures to build

integrated national innovation system

Continuous implementation of

Regulatory and Administrative Reforms

Page 8: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Reforms to Develop of Real Estate Market

Liberalization of real estate market

Foreign nationals can purchase residential and commercial real estate and construction land

Simple procedures for obtaining construction permits using Electronic One-Stop-Shop for obtaining licenses and permits (gradezna-dozvola.mk)

Purchase of State owned land for construction of commercial /industrial and residential buildings at concessionary rates:

For industry, logistics, hotels and residential buildings – bidding starts as low as 1 EUR/m2

For commercial and business premises – starting bidding price 5 – 100 EUR/m2 depending on the location of the parcels

E-Auctions are available from any location/country on the web site gradezno-zemjiste.mk (with information on all current parcels on sale)

Benefits for foreign nationals Foreign nationals that invest 400,000 EUR have the opportunity to obtain

Macedonian citizenship

Foreign nationals that purchase real estate in amount of over 40,000 EUR

can obtain residence permit in Macedonia

Page 9: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

7 years continuously among the Best Reformers

36th BEST COUNTRY FOR

BUSINESS IN THE WORLD Forbes Magazine

1st IN THE WORLD WITH

LOWEST TOTAL TAX RATE (8.2%) PWC and World Bank Group 2014 Study

3rd BEST REFORMER

IN THE WORLD World Bank’s

Doing Business 2010 & 2012 Reports

25rd IN THE WORLD ON THE

OVERALL INDICATOR

“EASE OF DOING BUINESS” Doing Business 2014 Report

4 TIMES AMONG THE TOP 10

REFORMERS IN THE

LAST 7 DB REPORTS Doing Business 2008/10/12/14 Reports

- 3rd IN THE WORLD

IN GETTING CREDIT INDICATOR

- 7th IN THE WORLD

IN THE EASE OF

STARTING A BUSINESS

- 16th IN THE WORLD

IN PROTECTING INVESTORS Doing Business 2014 Report

Page 10: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Significant improvement on the world leading indicators

measuring business climate and competitiveness

46 places –“Best Countries for Business”, Forbes Magazine

Macedonia improved:

69 places – “Ease of Doing Business

Indicator”, DB Report

Macedonia is the 5th country among the 50

economies that have most reformed since

2005, DB Report 2014

Four times Macedonia is among the top 10

reformers in the world

Macedonia is among the 4 case studies in DB

2012 Report (with S.Korea, UK and Mexico)

21 places–“Global Competitiveness Index”, WEF Report

35 places–“Index of economic freedom”, Heritage Foundation

94

73

2007 2013

Rank of Macedonia on the Global Competitiveness Index, World Economic

Forum Report

94 92

75 69

32 34

22 23 25

2006 2007 2008 2009 2010 2011 2012 2013 2014

Rank of Macedonia on the Ease of Doing Business Indicator, World Bank "Doing Business" Reports 2006-2014

82

36

2007 2013

Rank of Macedonia among the Best Countries for Business, Forbes Magazine

78

43

2006 2014

Heritage Foundation: Index of economic freedom (rank)

Page 11: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Free Trade Agreements

EU – European Union (28 countries)

EFTA – European Free Trade Association

(4 countries)

CEFTA – Central European Free Trade Agreement

(7 countries)

Bilateral Free trade agreements with: Turkey and Ukraine

Free Trade Agreements provide access to markets in 41

country with 650 million consumers

Page 12: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Why Macedonia?

Investment

Incentives

Competitive

Workforce

Excellent

Infrastructure

Investor -

friendly

Government

Competitive

Location

Higher Profits & Increased Competitiveness

Page 13: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

MACEDONIA

KOSOVO

SERBIA

MONTENEGRO

BOSNIA

AND HERZ.

CROATIA

SLOVENIA

ITALY BULGARIA

ALBANIA

GREECE

ROMANIA

HUNGARY

SLOVAKIA

AUSTRIA

SWITZERLAND FRANCE

SPAIN

PORTUGAL

BELGIUM

LUXEMBOURG

GERMANY

CZECH REPUBLIC

POLAND

UKRAINE

BELARUS

RUSSIA

UNITED KINGDOM

TURKEY

MOLDOVA

Excellent Infrastructure and

Competitive Transportation Costs

2.5 hours to Port of Thessaloniki

2 Brand New Int’l Airports

- Int’l Airport Alexander the Great -

Skopje (Capacity 4 million

passengers, 23 check-in desks, 6

passengers boarding gates, Cargo

hangar with 40,000 tons)

Large pool of logistic companies

provide competitive transportation

costs and delivery times

All of Europe in 2-3 days Via Highway Connections

35 days or less inbound container ships from China

• Two Pan-European corridors:

– East-West Corridor 8

– North-South Corridor 10

• Road network: 9,205 km

• Railway network: 900 km

• Two international airports:

– Skopje

– Ohrid

• International ports*:

– Thessaloniki (Greece): 250 km

– Durres (Albania): 300 km

* Distance from capital Skopje

Page 14: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Sections for concessions

A. Skopje - Blace (24 km)

B. Gostivar - Kicevo (42 km)

Investment Opportunities

Motorways

Sections under construction

Other Motorways

Reconstruction and modernization of existing and building of new regional motorways

and local roads with support of EBRD and the World Bank

A. Demir Kapija - Smokvica (28.2 km)

B. Skopje - Stip (53.5 km)

C. Kicevo – Ohrid (65 km)

A

B

C

B

A

Page 15: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Investment Opportunities

Railway Transportation

Corridor 8 – Eastern Section:

• Reconstruction of the railroad section

Kumanovo-Beljakovce with length of 30 km

• Construction of the railroad section

Beljkakovce-Kriva Palanka toward Bulgarian

border with length of 60 km

• Total construction cost estimated at €420M

• EBRD participates in the project realization

Railway connection between

Macedonia and Bulgaria

Modernization

• Modernization of the railway on Corridor X financed by EBRD (54 km)

• Renewal of the passenger transport fleet and procurement of 150 train cars of

various types for freight transport

• Rehabilitation and upgrade of the railway station in Skopje

Page 16: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

• Construction of national gas transport system (value ≈ €350M)

• Opening of lignite mines for electricity production (value ≈ €200M)

• PPP with the National Power Producer ELEM for the construction of a

combined cycle heat and power plant (value ≈ €250M)

• An ongoing tender – under the auspices of the IFC advisory services

for two large HPP “Cebren and Galiste” (value ≈ €600M)

• Rehabilitation of the existing hydropower plants (value ≈ €100M)

• HPP “Boskov Most” and “Lukovo Pole” (value ≈ €170M)

• Privatization of the minority share (up to 49%) of the state owned

electricity generation company ELEM (book value ≈ €1.2B)

• Construction of three new 400 kV overhead lines (value ≈ €60M)

• New SCADA, (re)construction of more than 200 km of numerous 110

kV overhead lines (value ≈ €45M)

• Potential for numerous small HPP’s (up to 10 MW)

• Bogdanci wind park, 16 wind turbines with total capacity of 36.8 MW

and annual energy production of 100 GW (value ≈ €55M)

Investment Opportunities

Energy Sector

Page 17: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Investments in Education

• Education Budget ~5-6% of GDP

• Mandatory secondary education

• Entrepreneurship and 2 foreign languages as subjects in primary schools

• New universities with campuses in many cities in Macedonia

• €60M invested in over 50 new R&D laboratories

• Textbooks from top 100 world universities

• Scholarships

• 99% enrolment rate from secondary to tertiary education

• 71,114 total number of students in Public and Private Universities

• 6,617 number of IT students

Foreign

Languages

Primary

School

Students

Secondary

School

Students

English 91% 94%

French 22% 32%

German 13% 21%

Italian / 2%

Russian 1% 2%

Turkish / 1%

Total No. of primary and secondary schools students 310,000

Source: State Statistical Office, Macedonia (Education 2008/2009)

Education

Page 18: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Major recent investors in Greenfield sites

Phase 1: $12M;160 empl’s;

Pharmaceutical plant;

The largest pharmaceutical

company in Russia

€10M; 150 employees;

Production of armored high-

pressure rubber hoses for the

automotive industry

Plant 1, TIDZ Skopje 1: $40M; up

to 500 employees; Production of

equipped PCBs for Mercedes, VW,

BMW, Renault, Ford, Skoda, PSA

Plant 2, TIDZ Stip:

$20M; 1,400 employees; Cut &

trim plant for car seats

€25M; 4,500 employees;

Plant for production of wiring

harness and electrical

management systems

Plant 1, TIDZ Skopje 1: €80M; 350+ employees; Exhaust

catalyst manufacturer supplying all OEM plants in Europe;

The biggest exporter from Macedonia

Plant 2, TIDZ Skopje 1: €65M; 300 employees;

Set to double production

€20M; 500 employees;

Production of buses & coaches for

the USA and EU markets;

Major bus manufacturer in Europe

€20M; 3,500 employees;

Wire harness automotive supplier;

Production of cable installations in

Macedonia

€35M; 500+ employees; 15,000 m²

plant; Production of PCBs, metal &

plastic housings and final assembly

(Mercedes, BMW and Audi)

€25M; 500 employees;

Production of capacitors

(consolidation of European

footprint)

€6M; 1,500 employees;

Production of interconnect

systems for safety devices and

expanding onboard electronics

€10M; 150 employees;

Wire harness automotive supplier;

Production of standard and special

automotive cables and wires

Page 19: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Competitiveness for Investments in Macedonia

Price Level Index for Construction

Price Level Index for Investments

Source: Eurostat, January 2014

53 59 61 62 67 70

100

Macedonia Bosnia andHerzegovina

Serbia Albania Croatia Montenegro EU28 average

37 40 42 46 52 55

100

Macedonia Bosnia andHerzegovina

Serbia Albania Croatia Montenegro EU28 average

Page 20: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

TECHNOLOGICAL INDUSTRIAL

DEVELOPMENT ZONES (TIDZ’s)

– FREE ZONES

Page 21: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Global Free Zones of the Future

2012/2013 Winners fDi Magazine

fDi Magazine’s Global Ranking of Economic

Zones reported Technological Industrial

Development Zones Skopje 1 & 2 in the

top 50 Free Zones of the Future 2012/2013

Page 22: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

• Connection to utilities, complete infrastructure is available

• Subsidy of up to €500,000 towards construction costs

• Green Customs Channel available at border for rapid export from Zone to EU

countries

• Land in the TIDZ is available under long-term lease for a period of up to 99 years

• Training and job creation grants

• All incentives are in line with EU regulations

TAX TAX RATES

TIDZs Outside TIDZs

Corporate tax 0%

for the first 10 years 10%

Personal income tax 0%

for the first 10 years 10%

Value added tax 0% 18%

Property tax 0% 0.1% - 0.2%

Excise taxes 0% 5% - 62%

PRODUCT CUSTOMS DUTY

TIDZs Outside TIDZs

Raw materials 0% Up to 15%

Equipment 0% 5% - 20%

Fiscal Benefits

Investment Opportunities

Technological Industrial Development Zones - TIDZs

No customs duties & No VAT on

imported raw materials, equipment

& construction materials

Page 23: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

The Free Zone Authority at Your Service…

Identification of project

specific location factors

Cost analysis

Identification of supplier

base

Detailed due diligence

University linkages

Reference company linkages

Recruitment agencies

linkages

Organization of meetings

with legal advisors and

financial partners

Design and infrastructure

approvals

Issuing building and

operational permits

Customs outpost in the

Zone

Zone infrastructure

maintenance and upgrade

Support with relevant tax

and customs issues

Assistance in acquiring

visas/work permits

Coordination and support

in contacts with other

state and local authorities

Business

opportunities

analysis

One-stop-shop

Creating

linkages

Aftercare

One-stop-shop and project

management approach

Locations, operational costs

and competitiveness

Labor availability, HR

companies and consulting

Ensure success!

Our

Services

Page 24: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

• A speciality chemicals company, world leader in advanced materials technology

• Origins date back to 1817, floated 1942, FTSE 100 company since June 2002

• Operations in over 30 countries with around 11,000 employees

• Leading global market positions in all its major businesses

Johnson Matthey - Case Study

Overview of Johnson Matthey Plc

Johnson Matthey ECT Macedonia

Construction Phase from Greenfield Site

to Operational Factory -15 Months

Page 25: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Johnson Matthey - Case Study

PHASE 1

• Fully integrated

manufacturing site

for automotive

catalyst production

• €80M investment

• 350+ employees

CONSIDERED COUNTRIES

• Reviewed: Bulgaria, Croatia,

Estonia, Latvia, Lithuania,

Slovenia, Romania, Ukraine,

Czech, Poland, Hungary, Slovakia

• Initial choice: Czech Republic

Macedonia a “Late entrant”

WHY MACEDONIA

• Macedonia scores best for labour, slightly lower on logistics

• Labour availability looking very good for Skopje

• Our experience has been positive, Invest Macedonia, Ministry and others superb

• This will be JM’s ‘mega-European plant’ and the largest ever single investment

project

Colin Jaffray, Director, Strategic Planning, Johnson Matthey Plc

Page 26: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Johnson Matthey - Case Study

LOCAL FACTS AND EXPERIENCE

• Government and the departments very helpful during the investment phase

and after care

• Regulatory framework and business policies being actively developed

• Infrastructure on TIDZ now in good state, focus on future improvements

• Recruitment of local workforce successful, quick to learn and hard working -

positive feed back from customers

PHASE 2

• Set to double the

production

• €65M investment

• 300 additional

employees

“Present in Macedonia since 2010,

producing six million world-class

catalysts, being the country's number one

exporter. The expansion comes as a

response to the rapidly increasing demand

for more sophisticated and complex

catalysts and the effort undertaken by

the Macedonian Government to welcome

and fully support our initial investment”

Larry Pentz, Executive Director on Environmental

Technologies, Johnson Matthey Plc

Page 27: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Connections, Culture and Lifestyle

Brand New Int’l Airports in

capital Skopje and Ohrid

- €120M+ investment from TAV

Macedonia is a country of nature, the cradle

of culture, place of great hospitality that

offers a mix of traditional and modern life

International cultural events:

- Ohrid Summer Festival

- Struga Poetry Evenings

- Skopje Jazz Festival

- May Opera Evenings

Largest wine producer in the region

- 78 wineries in Macedonia

- “Wine Road” travel programs

5 International Schools with

large mix of ex-pats Summer and winter sports

- 4 national parks

- Lakes, several ski-centers

Page 28: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

• Reducing VAT on tourism from 18% to 5%

• Promotion of sites for construction of hotels & tourist facilities and Tourism

Development Zones

• International branding - Macedonia Timeless Campaign

• Tour Operator and airline subsidies (10-25 € per tourist)

• Increase in overnight stays of tourists from EU of 38% in 2011 and 25% in 2012

Government measures, policies and specific projects

Opportunities in Tourism

What they say?

Best in Travel 2014: Top 10 countries not to be missed

Macedonia was ranked among the 10 countries destined for an

epic year, whether they’re hosting festivals, cutting the ribbon

on new attractions or simply raising their game for travelers

World Economic Forum - Travel & Tourism Competitiveness Report 2013

"Attitude of population toward foreign visitors"

MACEDONIA –

4th most friendly country in the world

Page 29: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

Tourism development zones near

the three tectonic lakes

Tourism development zones in

the mountain regions of Shar

Planina, Kozuf and Galicica

• State-owned land

• Opportunities for hotels and leisure

developments, sport and

recreational centers, amusement

and aqua parks etc.

Tourism Development Zones

Dojran

Lake

(2 Zones) Tourism development zones:

Ohrid

Lake

(1 Zone)

Popova

Shapka

(1 Zone)

Galicica

(Ski Center) Kozuf

(Ski Center)

Page 30: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

30

EU & NATO Candidate Status

Macroeconomic and financial stability

Prudent fiscal policies that support economic growth

Attractive tax package and Incentives in FEZs

Young, available and competitive work force

(41% of population under 30, excellent language skills)

Consistent and predictable policies

Track record for successful implementation of economic, regulatory and administrative reforms

Among top reformers according to WB Doing Business

Free trade to 650 million market

Solid Infrastructure (Trans European Corridors 8 & 10)

Business friendly government

SUMMARY: WHY TO INVEST IN MACEDONIA?

Page 31: EMERGING ECONOMY IN EUROPE · Financial System Sound and stable financial system No spillover of the world financial crisis on Macedonia 16 banks with capital adequacy ratio of 17.3%

31

Thank you for your

attention