The National Bank of the Republic of Macedonia, the country’s central bank, focuses on ensuring price stability as well as the stability of the banking sector. The bank also supports the government’s economic-development strategies and aims to keep inflation low. Dimitar Bogov, Governor, discusses top priorities for the National Bank as Macedonia’s economy continues to mature.
European Times: What are some of your current projects?
Dimitar Bogov: Last year we completed a “Needs Assessment Analysis” with the European Central Bank and 11 other European central banks, and the National Bank of Macedonia was praised for its staff, organisational structure and operations. We are proud of this and are using the findings of the report to address issues that we will deal with in the upcoming period. We will soon be in compliance with all the criteria of the European System of Central Banks, and we are already working with several EU central banks. On the operational side, in the last two years we were very active in macro prudential policies and unconventional policies aimed to encourage credit growth and financial market deepening.
European Times: How is the banking sector performing?
Dimitar Bogov: The Macedonian banking sector was quite resilient during the crisis. All banks remained solvent and credit growth continued. Now we would like to pursue a process of consolidation. The banking sector is currently dominated by three banks, while three or four others are catching up and other banks (up to 16 in total) are not very visible. We think Macedonia needs around seven to eight strong banks and perhaps one or two niche banks.
European Times: What are your projections for Macedonia’s economy this year?
Dimitar Bogov: The Macedonian economy is small, open and closely linked to the EU economy, because more than 70% of our exports are to the EU. The EU economy is picking up this year, which will benefit Macedonia. Last year our economy was mainly driven by new FDI and public-sector investments. This year we expect a growth in traditional export industries to recover too. Thus, economic growth will strengthen to 3.7%. Inflation is firmly under control to around 1% this year and we do not expect pressure from domestic demand on inflation before closing the output gap in 2015.
European Times: What is your personal message to potential investors?
Dimitar Bogov: Macedonia is attracting more FDI in export-oriented industries, and we expect this process to continue. The National Bank is here to support all FDI projects and to eliminate any obstacles to their success in Macedonia.
