Delegation of the European Union to the former Yugoslav Republic of Macedonia

Kick-off event for the next Economic Reform Programme Cycle

Skopje, 12/06/2018 - 10:45, UNIQUE ID: 180612_4
Speeches of the Ambassador

Dear Minister Tevdovski,

Dear Head of OECD South-East division Ms Kisielewska,

Colleagues, Ambassadors of EUMS

Ladies and gentlemen,

 

Today for a change we are going to focus on economic governance. This is also the kick-off event for the next Economic Reform Programme cycle (the so-called ERP)

We rightly turn our attention to economic reform. The EU placed economic governance among the fundamentals of the EU enlargement process to the Western Balkans.

Without a striving economy, also political processes for which we eagerly await the result these days will hardly have a chance of succeeding.

 

Ladies and Gentlemen,

 

The European semester is the annual economic governance process of the European Union in which all EU member states coordinate their medium-term economic policy plans with each other and with the Commission and the ECB. The aim of the European Semester is to ensure sound management of public finances, to avoid excessive government debt, prevent excessive macroeconomic imbalances in the EU, and to support structural reforms to boost private investment. The final aim is to create more jobs and growth.

Since 2015 Future members have been involved in the Economic Reform Programme exercise that is in many ways similar to the European Semester.

In your country in particular, the ERP has become a very important strategic document. It plays a key role in improving economic policy planning and steering reforms to sustain macroeconomic stability, boost competitiveness and improve conditions for inclusive growth and job creation.

It has contributed a great deal to improving the internal cooperation within the administration.

Crucially, with limited public funds, it makes public choices easier by saying what the priorities are.

The ERP process culminates in the economic and financial dialogue between the EU and the Western Balkans and Turkey in May. Here the Ministers of Finance and the central bank governors of all seven enlargement countries adopt Joint Conclusions with specific policy guidance for each of the countries outlining economic policy priorities for the coming 12 months.

 

Ladies and Gentlemen,

 

• a few words on the content of the latest ERP and on the European Commission assessment of the implementation of the past policy guidance that were adopted in the Joint Conclusions of 2017.

• First, I’d like to highlight that the effectiveness of the policy guidance - in strengthening the macro-fiscal stability and in supporting structural reforms - crucially depends on the implementation of this policy guidance. That is in the hands of the country.

Overall, on average countries stepped up implementation of policy guidance as compared to the previous year. Good news is also that your country has the highest score of all countries and significantly improved its score since last year. This is commendable.

 

Achievements are for example visible in the following areas:

In Public Finance Management, where the country has started implementing a reform programme; has adopted measures to introduce a medium-term expenditure framework; has dramatically enhanced fiscal transparency by publishing budget documents and the list of public arrears.

The central bank maintained a monetary policy stance consistent with the exchange rate peg and safeguarding price stability.

The government limited the use of urgent and shortened procedures and involves all the stakeholders more systematically for draft legislation: the civil society and the business sector, the academia and the think tanks that are regularly consulted in all the stages of the ERP and whose views are the most important as the citizens and their representatives are the engine of social and economic changes in the country.

Also, all ministries are now obliged to publish all draft legislation on ENER and the days for consultation are extended.

The legislation to allow practical trainings in companies was amended and other activities to facilitate practical trainings were implemented.

The new Education Strategy was adopted that includes compulsory steps to improve the qualifications of teachers.

As Minister Tevdovski mentioned, there are still many challenging structural reforms to tackle in order to transform the country into a functional and competitive market economy. There is need to continue and deepen he reform speed!

Let me reassure you that the EU will continue to provide the necessary support to the country in the implementation of the structural reforms. Let us not lose the momentum from this year's good results.

Unfortunately, I will have to leave soon after my presentation. However, my colleagues from Brussels and from my office in Skopje will stay to answer any questions you might have on the topic.

 

I wish you a very successful conference.