Skopje, 11 December 2020

The latest macroeconomic forecasts of the National Bank presented to the diplomatic corps and the representatives of the international financial institutions - the forecasted economic growth of 3.9% for the following year, we expect that it would be supported by all sources of the growth.

Yesterday, at a video-conference meeting, the latest macroeconomic forecasts of the National Bank were presented to the diplomatic corps and the representatives of the international financial institutions.

Presenting the forecasts, the Governor Anita Angelovska Bezhoska pointed out that the macroeconomic scenario and the surrounding risks are primarily conditioned by the development of the health crisis on a global scale, i.e. by the pandemic management and its consequences on the behavior and expectations of economic agents.

“The forecasted economic growth for the following year, we expect that it would be supported by all sources of the growth, whereby the domestic demand would make a positive contribution. We expect a gradual decrease in the restraint and an increase in the propensity to consume. Household consumption would also be supported by the growth of disposable income and solid lending activity by banks. We also expect increased investment activity and increased propensity to take new investment decisions, an assessment that is in accordance with further growth of the corporate lending, intensification of the government infrastructure projects, as well as with the stabilization of the global economy, growth of the exports and increased foreign direct investments.” - the Governor said.

In the medium run, as mentioned at the meeting, the economic growth is expected to continue, but still, the uncertainty and the risks are still present.

In her presentation, Angelovska Bezhoska separately pointed out that inflation remains low and stable, and that despite the shock caused by the pandemic, the external position of the Macedonian economy is moderate, whereby the current forecasts of the balance of payments indicate a growth of the foreign reserves in the period of forecast.

At the meeting, the Governor referred to the lending activity, highlighting its current solid growth, significantly supported by the relaxed monetary policy and the regulatory flexibility provided by the National Bank. In the next period, it is expected a further increase in the credit support, which will continue to be key for the recovery of the economy, and in circumstances of growth in the sources of financing and more favorable expectations.

As already announced, the main downward risk to the forecasts is associated with the possible re-introduction of tough restrictive measures to prevent the spread of the virus, as well as the possible slower management of the virus than the current expectations. However, on the other hand, a positive risk are the faster progress in the coronavirus treatment and vaccine development are factors that instill optimism. Hence, within the meeting it was emphasized that if the coronavirus threat is overcome faster than expected, enhanced confidence could significantly boost economy.

The presentation of the macroeconomic forecasts to the diplomatic corps and the representatives of the international financial institutions is a traditional practice, and this time, taking into account the circumstances with the pandemic, it was held for the first time via video-conference link.