Skopje, 14 January 2023 

“According to the October forecasts, last year the balance of payment current account deficit was estimated at around 7% of the gross domestic product (GDP), while gradual reduction at about 3% of GDP on average is expected in the medium term. The increase in the foreign trade deficit last year, mainly as a result of the growth of energy prices, caused widening of the current account deficit, amid positive impact of other components, especially private transfers. The trade deficit would also stabilize in the medium term, which will narrow the current account deficit” said the Governor of the National Bank Anita Angelovska Bezhoska for Bloomberg, on the sidelines of the Central and Eastern European Forum, organized by Euromoney.    

The more pronounced pressures on the import side are not expected to significantly threaten the external balance, given the high level of private transfers, which cover a significant part of the trade deficit. In the first nine months of 2022, they reached about Euro 1.8 billion, or by 30.5% more compared to the same period last year. This year the current account deficit is expected to reduce to 5.6% of GDP, and it will continue to decrease under the assumption of gradual depletion of negative effects of the war in Ukraine and stabilization of energy prices. The financial net inflows would fully cover the current account deficit, thus creating conditions for further growth of the foreign reserves in the medium term. It is important to note that throughout the forecast horizon, foreign reserves are expected to remain appropriate, which reached Euro 3.8 billion at the end of December 2022, one of the historical highs of foreign reserves in the country.