Economic growth to slow down this year: New spring forecast of the World Bank
➢ News (13.04.2022, во 12:29:59)
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Economic growth to slow down this year: New spring forecast of the World Bank

In their latest spring forecast, the World Bank predicts a slower growth of the Macedonian economy this year, amounting to 2.7%. The reasons provided are the consequences of the Russo-Ukrainian conflict and the sanctions imposed against Russia.

Their forecasts include that inflationary pressures, particularly from food and energy prices, will increase the cost of living, largely affecting the vulnerable populations.

According to the projections of the World Bank, fiscal deficit will remain high, projecting growth of the public debt over 62% of GDP.

If the war in Ukraine continues, the World Bank forecasts decline of external demand, higher prices in goods and energy, and late investments. This scenario, according to the report, would result in an even lower growth and more frequent fiscal support requests.

Growing political uncertainty and the deferred access to the EU may lead to weaker reform efforts toward strengthening the growth potential and consolidating public finance, indicates the report.

World Bank recommends to the country to restore public finance to a sustainable course in the medium-term and to focus on solving the structural challenges such as the declining human capital, productivity, migration, feeble regulatory frameworks, poor competition policy, and independence of the judiciary.

In 2023 and 2024, the WB expects the Macedonian economy to register growth of 3.1% and 3.2% respectively.

Chamber Informational department