Skopje, 16 May 2023 (MIA) - The implementation of the established structural reforms by the Government, supported by the EU, through the IPA funds and the Economic and Investment Plan for the Western Balkans are the basis for maintaining economic resilience and encouraging inclusive growth. A significant role in this will be played by the acceleration of the green and digital transition, the implementation of education reforms, the improvement of the competitiveness of domestic companies, the reduction of the informal economy, as well as the creation of new jobs. These are some of the recommendations from the joint conclusions of the Economic and Financial Dialogue between the EU and the Western Balkans and Turkey, which was held in Brussels on Tuesday, with Finance Minister Fatmir Besimi also in attendance. 

"We are facing a new reality dictated by several successive crises that require the implementation of appropriate and efficient policies, most of which require a quick response while protecting public finances. Amid such conditions, when we have a slowdown in economic growth, the main focus of the government policies, in addition to dealing with high inflation, is aimed at supporting the investments needed to maintain a positive growth rate in the short-term and its acceleration in the medium-term, as well as implementation of structural reforms," Besimi pointed out. 

He stressed that work is underway on fiscal consolidation and measures to increase revenues through the concept of tax reform, reduction of the informal economy, etc., in order to protect public finances and leave more fiscal space for capital investments. 

"The implementation of the recommendations will contribute to building an economy more resistant to shocks and to speeding up growth in the medium-term, which is expected to achieve an average growth rate of 4 percent in the 2024-2028 period. It is important for the country to continue with fiscal consolidation. In 2022, the budget deficit was lower than planned despite the large energy support, and in 2025 it is projected at 2.9 percent of GDP," the Ministry of Finance said in a press release. 

Additional progress, the press release adds, is expected in the coming period through the implementation of the announced tax reform and the set fiscal rules in the new Budget Law.

"Inflation, which is the result of global factors, is decreasing. Monetary policy is appropriately tightened and should continue to be vigilantly monitored and price stability preserved. The guidelines are also to continue with reforms in education and active policies to improve inclusion in the labor market. Risks are still associated with uncertainty from the war in Ukraine, energy and food prices, and global financial market conditions. In this regard, support for vulnerable categories of citizens and companies should continue if necessary and should be targeted. To support the reforms and respond to the challenges, the EU proposed EUR 100 million of macro-financial assistance to cover the country's financing needs," reads the press release. 

The Annual Economic and Financial Dialogue in Brussels brings together representatives of the EU member states, the Western Balkans and Turkey, the European Commission and the European Central Bank, as well as representatives of the central banks of the Western Balkans and Turkey. 

Participants agreed that the dialogue should play a central role in establishing common policy directions to support a sustainable medium-term economic recovery and help meet the economic criteria for EU accession. They expressed their commitment to the dialogue and encouraged the countries of the Western Balkans and Turkey to implement the policies and reforms that have been jointly determined.