Centre for Administrative Innovation in the Euro-Mediterranean Region
This document provides information on policies for business in Macedonia and is part of a series focusing on countries in the Mediterranean published by the Centre for Administrative Innovation in the Euro-Mediterranean Region. Since the beginning of 1994, the government has been implementing a bold program to restore macroeconomic stability and support a rapid transition towards a market economy, in spite of intermittent conflicts and disturbances that have had an adverse impact on the development of the institutions necessary to support the transition. The reform strategy has been designed around the discipline of a fixed exchange rate coupled with structural reforms to create market institutions, to consolidate private ownership, and reduce the cost of doing business. Financial support from the International Monetary Fund, the World Bank, the European Union, and other bilateral donors has been a key to the successful implementation of the program, but the main social and economic problems of the Republic are not definitively solved. The goal of keeping inflation to a low level has been achieved: in spite of the fact that inflationary expectations still exist, it can be said that stable prices have largely contributed to the basic function of the free market mechanism - successful allocation of productive resources.
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