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In-depth Business Intelligence

Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 4,705 3,712 3,400 118
GNI per capita
 US $ 1,980 1,700 1,690 111
Ranking is given out of 208 nations - (data from the World Bank)

Books on Macedonia


Area ( 




Branko Crvenkovski

Private sector 
% of GDP 

Update No: 104 (01/01/06)

Cameron's playboy host in fraud probe
In a bizarre revelation it appears that David Cameron, the new UK Conservative leader, accepted hospitality from a company owned by a Macedonian playboy at the centre of criminal investigations into alleged fraud and tax evasion. This was disclosed by the Sunday Times in an article on December 11. It involves an important issue, Macedonia's bid to join the European Union (EU).
The company in question paid for a four-day "junket," as he described it himself, during which Cameron watched England's European Championship football game in Skopje, the Macedonian capital. 
His hosts were keen to lobby Cameron on Macedonia's case for entry to the EU, which would bring them commercial benefits. Cameron later spoke in the Commons pressing the Balkan state's EU claims.
Details of Cameron's trip in September 2003 have emerged after his confirmation as Tory leader. The cost of his stay in the Aleksandar Palace, the five-star hotel used by the England team, and his match ticket were met by Orka Holdings, one of the country's top textile companies. Cameron says he paid for his flights.
Orka has been at the centre of a number of criminal investigations in the past two years for alleged tax evasion, employment of illegal workers and multi-million-pound Vat fraud. It is owned by Jordan Kamcev, a tycoon whose two divorces from the same woman and his new lover have made his private life the stuff of soap opera in the press. Police have issued a warrant for his arrest to question him over alleged tax offences.
In one raid on an Orka factory it was reported that illegal workers almost suffocated after being hidden in cardboard boxes to avoid the inspectors.
Cameron - who was a back-bench MP at the time of the visit and now campaigns for "compassionate conservatism" - declared the hospitality from Orka in the Commons register of members' interests. The trip was organised through Andrew Feldman, a college friend and tennis partner who accompanied him to the football match. Feldman, a 39-year-old textile millionaire, is a member of Cameron's Notting Hill set and is tipped to become a deputy treasurer of the Tory party. He has been cast as a Tory version of Lord Levy - a reference to Tony Blair's fundraiser - after handling Cameron's campaign finances. 
Jayroma, his UK-based family company - which donated 10,000 to Cameron's campaign - works in partnership with Orka, distributing its clothing in western Europe and helping to finance at least one of its factories. 
Cameron has described hospitality from Orka as a "junket". In a diary he wrote for The Guardian he said: "All right, I admit it. Part of the attraction of the visit was the chance to watch the vital England-Macedonia football international." He eulogised David Beckham, scorer of the second goal in England's 2-1 victory. 
But there was also another purpose to the trip. In the days before the match, Cameron met Boris Trajkovski, the president, and other politicians in the former Yugoslav republic. 
The visit appears to have persuaded Cameron that Macedonia had a strong case to join Nato and the EU, membership of which would be beneficial to Feldman's company and Orka because it would lift trade tariffs, although this cold not be for many years. 
Returning to Britain, Cameron took up the country's cause. Intervening in a Commons debate in March 2004, he called for ministers to give Macedonia assurances about its prospects for EU membership. 
He also raised the matter in his diary article. He wrote: "(Europe must) ensure there is a speedy framework for getting the former Yugoslav republics into the EU so they can benefit from free trade and structural funds," which is a position many would agree with. 

EU Commissioner negative about membership talks
The need to lobby for Macedonia's EU entry, if it is to take place at all, is becoming clearer by the day - and not just to Cameron. There are those in the EU who are decidedly lukewarm about the idea, which would only happen if Serbia was brought in too, a tough proposition. 
Brussels has urged Macedonia to step up efforts on reforms for eligibility for membership talks with the 25-nation bloc. "Only a few years after being on the brink of civil war, the country has achieved remarkable political stability and democratic development, particularly thanks to the implementation of the Ohrid Framework Agreement. She is currently the only functioning multi-ethnic state in the Balkans, and thus a case in point that such a multi-ethnic model can work. For these reasons the Commission can recommend the status of a candidate country for Macedonia: however, the country is not ready to start accession negotiations yet." European Commissioner in charge of EU enlargement, Olli Rehn, said recently.
Speaking in Strasbourg at the European Parliament, Rehn added, "The (EU) Commission is not rushing ahead to recommend accession negotiations before the country is ready. We will assess the situation regularly and will recommend opening negotiations only once a sufficient level of compliance with the Copenhagen criteria is reached."
The proposal by the European Commission should be adopted by the governments of the 25 EU member nations in December, and the problems with Greece could erupt before Macedonia joins the EU, as Athens has threatened that the neighbouring Balkan country can not enter the bloc with its current constitutional name: Republic of Macedonia.
Greece and the European Union use the acronym "Former Yugoslav Republic of Macedonia - FYROM," as admitted in UN since 1993. Macedonia is also the name of Greece's northern province and Athens has been worried that the name could imply territorial claims for its own province and make separatists seek independence. Greece and Macedonia have been disputing over the name of the Balkan country for more than a decade.

US co-hosts anti-trafficking conference in Macedonia
There is growing awareness that human trafficking and other types of organized criminal activities pose a serious threat to democracy and that criminals are exploiting democratic freedoms to undermine societies, an American diplomat said during a southeast European conference on illicit trafficking. "The number of democratic, free-market governments has grown consistently in Europe and around the world," Gillian Milovanovic, the US ambassador to Macedonia, said December 5 in Skopje, Macedonia. "Sadly, however, the very freedoms that characterize democracy and free markets can be and are being exploited by criminals."
She told the conference that there is evidence that "transnational crime, corruption and violence are on the increase. And it is equally clear that trafficking undermines regional security, stability and economic development."
Milovanovic focused on human trafficking, noting that "No country, including my own, is immune." It is estimated that between 15,000 and 20,000 people are trafficked into the United States every year, she said, and "worldwide, there are estimates that between 600,000 and 800,000 people are trafficked across international borders every year."
The ambassador said that on December 3, the United States became an official party to the U.N. Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children -- also known as the Palermo Protocol. 
Victims of human trafficking "are forced into prostitution, hard labour, child soldiering and other forms of involuntary servitude - a fancy name for slavery," Milovanovic said.
She called the Palermo Protocol "an important achievement . It seeks to prevent trafficking, protect victims and promote anti-trafficking cooperation among nations - precisely the things you are engaged in here today." 
The specific purpose of the conference was to enhance efforts at regional cooperation against illicit trafficking. Milovanovic said the State Department's annual report on human trafficking provides a basis for diplomatic engagement with countries on the issue, and it helps promote action and national commitment to fight the scourge of trafficking in persons. "In the last year alone, 39 countries have enacted new anti-trafficking laws, and 32 additional countries are in the process of drafting or passing new anti-trafficking legislation," she said.
The conference was co-sponsored by the Macedonia's ministry of foreign affairs and the US Defence Department's George C. Marshall European Centre for Security Studies. The three-day conference was attended by 70 government officials from more than a dozen countries, according to a news release by the U.S. European Command.
(Distributed by the Bureau of International Information Programs, US Department of State. Web site:

Transport minister upbeat about developments in Macedonia
The legal environment created by the Macedonian Government has opened the door to foreign investors and to the international business community for the purposes of investment in the country, Minister of Transport and Communication, Xhemali Mehazi, said on 9th December in an address to the session "Necessary Pre-conditions for Successful European Integration," held in Monte Carlo.
According to him, the only way to achieve economic benefits is to develop a link between foreign investors and the international business community on the one hand and all entities in the country, including Macedonia's Government, on the other. "Concerning the railways, air transport and telecommunications, agencies are being established as independent regulatory bodies in accordance with the already established practice of the Agencies functioning in many countries of the EU", Mehazi said. 
"As far as the infrastructure construction is concerned, EU Corridors 8 and 10 remain to be priorities, whilst the efforts for their completion are confirmed with the conclusions agreed by the High Level Transport Group at the recently held meeting in Brussels," the Minister added. 
In connection with the future investments for completion of the construction of the road and railway network along Corridors VIII and X, as well as modernisation of the two airports in Skopje and Ohrid, there is readiness for granting concessions, which represents application of one of the models of the Public Private Partnership or bank indebtedness. 



Fitch assigns ProCredit Bank Macedonia BB 

Fitch Ratings has assigned ProCredit Bank Macedonia (ProCredit Macedonia) ratings of Long-term foreign currency BB; Short-term foreign currency B; Long-term local currency BB+; Short-term local currency B; Individual D/E, and Support 4. The Outlook is Positive for the Long-term foreign currency rating and Stable for the Long-term local currency rating. The Long-, Short-term and Support ratings are based on Fitch's view of the potential support the bank is likely to receive from its owners in particular, ProCredit Holding AG PCH, rated BBB- in case of need. The Long-term foreign currency rating is constrained by the BB Country Ceiling of Macedonia, New Europe has reported.
PCH has a controlling stake in ProCredit Macedonia of 53.3 per cent. Other shareholders include Kreditanstalt fuer Wiederaufbau rated AAA, which is state-guaranteed and one of Germany's largest banks, as well as one of the largest development banks in Europe; European Bank for Reconstruction and Development (EBRD); the Netherlands Development Finance Company, Nederlands Financierings Maatschappij voor Ontwikkelingslanden NV, and International Finance Corporation, which is a part of the World Bank Group.
The Individual rating reflects ProCredit Macedonia's small size and short track record, significant shareholder funding, only recent achievement of profitability, and difficult local operating environment. The bank's capital ratios, while good at present, are set to fall in the medium term, due to planned balance-sheet growth.
The Individual rating also takes into account the bank's good asset quality and effective risk management to date, the latter largely reflecting PCH's centralised group control in Frankfurt.ProCredit Macedonia started operations in July 2003 and received a full banking license at end-2004. Total assets were 61 million Euro as of end-September 2005. The ProCredit banks were established to provide financing to micro- and SME customers. The ProCredit network currently consists of 19 banks in Eastern Europe, Latin America and Africa with total assets of 1.9 billion Euro. 
PCH is responsible for all major group functions, including strategic decisions, risk management controls and group supervision.



Free trade agreement increases exports

Albanian and Macedonian business cooperation, the impact of the Free Trade Agreement as well as the expansion of trade exchanges in different sectors of economy between the two countries were discussed in a meeting consisting of participants from Albania and Macedonia, New Europe reported.
The Director for WTO Relations at Ministry of Economy, Trade and Energy, Adriana Civici, said that the Free Trade Agreement with Macedonia had a positive impact by increasing Albanian exports which ran higher than imports. During the meeting, the participants expressed their belief that the continuation of foreign trade liberalization process will have an impact on products manufactured for production and export, as well as in trade balance.




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