The National Bank of the Republic of North Macedonia published remarks by Governor Anita Angelovska-Bezhoska from the EU–Western Balkans economic and financial dialogue in Brussels, outlining the central bank’s assessment of macroeconomic, monetary and financial stability conditions alongside reform priorities. She said macroeconomic stability had been preserved and strengthened despite recent economic and geopolitical shocks, with inflation returning close to its historical average and foreign exchange buffers higher than before the pandemic. Angelovska-Bezhoska noted that income convergence remains slow, with domestic income at around 43% of the European Union average, and that the inflation shock transmitted strongly given the economy’s openness and high energy dependence, pushing inflation up to 20% before it fell back to around 2.6% as monetary policy tightened and global commodity prices stabilised. Exchange rate stability was described as a key pillar requiring adequate reserves, with reserves now around 40% higher than in the pre-pandemic period despite pressures and foreign exchange market interventions. She also pointed to stronger financial stability through a significantly higher capital adequacy ratio and a comprehensive crisis-management regulatory framework, and described accession to the Single Euro Payments Area as a historic step for the banking system and the wider economy. The Governor cautioned that macro stability cannot substitute for structural reforms amid heightened uncertainty and geopolitical tensions, citing central bank estimates that deglobalisation could reduce growth by up to 5 percentage points depending on the scenario. While she said no significant negative effects have been observed so far and foreign direct investment has risen to a record level, she highlighted persistent structural weaknesses, including productivity growth below 2% over the past 15 years in the Western Balkans and driven mainly by resource reallocation rather than innovation, underscoring the need for greater innovation, technological progress and stronger institutions and business conditions.
National Bank of the Republic of North Macedonia 2025-05-14
National Bank of the Republic of North Macedonia highlights lower inflation and stronger reserves and warns deglobalisation could cut growth by up to 5 percentage points
Governor Anita Angelovska-Bezhoska of the National Bank of the Republic of North Macedonia emphasized macroeconomic stability and reform priorities at the EU–Western Balkans dialogue. She noted inflation's return to near historical averages and increased foreign exchange reserves, stressing the need for structural reforms amid geopolitical tensions. Despite record foreign direct investment and improved financial stability, she highlighted the importance of innovation and stronger institutions to tackle productivity challenges.