Publication: Positioning FYR Macedonia for the Global Economy: The Impact of Reforms and Investment Promotion in the Automotive Components Manufacturing Sector
Date
2017
ISSN
Published
2017
Author(s)
World Bank Group
Abstract
Over the last two decades, successive
governments and business leaders in the former Yugoslav
Republic of (FYR) Macedonia have been actively working to
transform the country’s economy and put it on a higher,
technology-based, growth trajectory. For a small, landlocked
country with a limited domestic market and a weak industrial
base, this requires building a private sector that is
competitive, export oriented,and integrated into global value
chains (GVCs). In FYR Macedonia, where 23.7 percent of
the labor force is unemployed and 30.7 percent of the
population lives on less than USD 5 a day (2016
data),creating an attractive, competitive, and
export-oriented private sector—one that leverages the
country’s proximity to developed European markets and
world-class enterprises—has become a political and strategic
economic objective of the highest priority. This report
describes the parameters of an aggressive reform and
investment promotion effort in FYR Macedonia that began a
decade ago and moved the country’s manufacturing sector
toward higher value added, technology-based production with
a unique focus on automotive component manufacturing. Readers
interested in learning how a small country located in the
Balkans region with a-priori low potential was able to reform
its institutions, promote itself, and attract foreign direct
investment (FDI) should find it useful. So will readers that
are interested in industry specific strategies that go
beyond first generation business environment reforms. Much
of the report is a look backwards, to describe the
parameters of the program, how it was executed, and results
that were achieved. However, future steps are also proposed.
The program is still very much a work in progress, and while
very real and significant gains have been made—much to the
credit of the country—certain aspects of it could be
improved. Parts of the program are also in the process of
being reshaped to reach new objectives, many of them related
to sustainability. How well the government of FYR Macedonia
focuses on new objectives defined by this transitional shift
and directs future resources to encourage the processes
there to go forward, will be a determining factor in whether
its companies, and the country as whole, will be able to
take the economy to a new level of competitiveness.
Citation
“World Bank Group. 2017. Positioning FYR Macedonia for the Global Economy: The Impact of Reforms and Investment Promotion in the Automotive Components Manufacturing Sector. © World Bank, Washington, DC. http://hdl.handle.net/10986/29427 License: CC BY 3.0 IGO.”