Mr. Georgievski, major reforms, within the State administration and various sectors of the economy, have been undertaken by your Government in order to enhance Macedonia's openness to the new market economy. Today, how would you evaluate the main achievements of your Gvt in that context?
Last year was an exceptionally reform-oriented year. Huge reform steps were taken in many sectors. We introduced the VAT system, we started the denationalization, we adopted the laws on public administration reform, banking system reform, we adopted the pension system law.
The Government managed to achieve very good financial results; foreign currency reserves have been almost doubled, and a large budget surplus was also gained.
These are the arguments due to which among the SEE countries, Macedonia was in the year of 2000 ranked first by the EBRD among all the 24 transition countries i.e. ex-communist countries, from Eastern Europe and Eastern Asia. That implies that last year, we were ahead of Hungary, Czech Republic and Poland viewed by reforms. Yet, I emphasize, that is an evaluation only for the previous year. With regard to Hungary, Poland, Czech Republic, they have achieved great reform success in the recent 10 years and are now far ahead on the way to the EU. I expect and believe that we shall manage to carry out reforms with the same pace during this year as well.
On Monday 9, 2001, in Luxembourg, you signed an agreement with the EU for Stabilization and Association, which was long awaited. This obviously represents a great vote of confidence from the EU towards Macedonia. What are the next steps to be taken by your Government to finally join the EU?
The Stabilization and Association Agreement (SAA) with the EU represents the result of all the processes and reforms undertaken over the last years. In particular, I would say last Monday we went one step further within our development process. The idea, however, is not to stop on SAA signing. Political goals are being focused on how to become a candidate for EU full membership. It is clear that this cannot happen in the first forthcoming round as candidate countries in the first EU expansion round have already been determined Our goal is that already in the second round Macedonia becomes one of the serious candidates for EU membership. Moreover, we have set clear objectives regarding the forthcoming NATO enhancing scheduled to take place during the next year.
As for WTO accession, I see it as a matter of procedure, and I don't see any considerable problems there. Certain adjustments and procedural tasks should perhaps be performed.
After the recent privatization of some large companies such as the Telecom and FENI, have you implemented any strategy to ensure that the companies sold to foreign investors will effectively contribute to improving the national economy in the long run?
I think full/complete privatization will be achieved very soon. The percentage of non-privatized companies is only about 10%, meaning that we are in fact finalizing the privatization process. We are very glad to see foreign investors coming in. In their presence in the country we see a strong prospective, hope and incentive for the further development of our economy. I can tell you that all our experience with foreign partners has been quite positive; all companies to which any foreign investor has entered have been operating well, developing, expanding. I can say that our whole strategy has been developed around the concept of doing our best to attract as many foreign investors as possible.
What are the main incentives designed by your Government in order to attract more FDI within Macedonia?
I think Macedonia really has several advantages on its side that make it attractive for foreign direct investment (FDI). I'll try to enumerate only some of them: Although being a small country Macedonia has a large open market, as it has free access to all European markets and customs-free trade regime with EFTA countries as well as with most of the CEE countries. Macedonia is the only country having signed free trade agreements with Yugoslavia and Ukraine. These agreements enable commodities to be exported to Yugoslavia or to Ukraine with only 1% customs fee, but only if these have been manufactured in Macedonia. Not any other country gives this opportunity. Any manufacturer intending to export its product in Yugoslavia or Ukraine would see the advantage of its coming to manufacture in Macedonia. |
The profit tax in the Republic of Macedonia amounts to 15% only which, according to our knowledge, is the lowest rate in Europe. Foreign investors in the Republic of Macedonia may also count on relatively low labor cost, solid infrastructure and a relatively efficient administration. We haven't heard so far that any foreign company has had any problems related to administration.
Macedonia has been one of the main promoters of regional cooperation, you are chairing the Southeastern Europe cooperation process. However, the harmonization of your relations with neighboring countries seems like a pre-condition to joining the EU. In that context, what is your philosophy of the role that Macedonia has to play within the region?
I think that the Balkans lived through very dramatic moments during the past 10 years. When our Government came to power, we inherited a great number of problems related to neighbouring countries. I can even say we used to have cold relations with our neighbours. In a period of 2 years, we succeeded to turn cold relations with our neighbours into friendly relations. We may now say that all our neighbors are our friends. However, we have now been having the problem with Kosovo. This problem originates from the high level of criminality there and the existence of numerous outlaw gangs. We have demonstrated a very good, strong example of regional cooperation. This Government's regional cooperation policy has been welcomed by the international community. Last year, the Republic of Macedonia was chairing the Southeastern Europe Cooperation Process. Within this process, Macedonia twice hosted the meetings of all Southeastern Europe leaders. As for regional cooperation, the Republic of Macedonia has been having wide support also from the international community. This was also confirmed by the decision of the US Secretary of State, Mr. Collin Powell, to exactly in Skopje have a meeting with the foreign ministers of 13 countries from the region.
The Stabilization and Association Agreement and the visit of Mr. Powel are rather strong signs showing that the international community views Macedonia as a real and indispensable leader in the region.
You are just 35 years old, but also surrounded by a great number of young ministers and advisers. Is it for you a way to express the need to convey the image of a young and dynamic Government?
I think your remark that there are many young people in our Government is correct. I have to tell you that it is not only about the image, but that the idea is to compose a young and dynamic Government. I believe that, not only in Macedonia, but also in all other post-communist countries, certain agreement may be detected not only on the ideological-political basis, but also on the generation one. This is probably a matter of mentality and customs adopted all along a lifetime; living and developing in a single-party/ communist system. A mature person can state having changed their ideology, yet the mental pattern remains more or less the same. I noticed this problem quite early. Some of the older officials of the Government had to fall out within some reasonable time frame and leave space for younger people. It is a matter of a very serious and very complex generation gap regarding the way of thinking, working habits, working efficiency and style. Treating older officials of the Government has been a natural development process having resulted from the needs to dynamize reform processes.
I am convinced that young people are faster in their accepting and adopting new things and find it easier to adjust to the new situation. They understand things and are surely more open.
I am satisfied with the work and results of young people in the Government and I hold that Macedonia may in that regard pose an example to other countries as well. |
V.I.P. INTERVIEWS 
