IBNA Interview/”The political crisis may send the country to a deep economic crisis”

IBNA Interview/”The political crisis may send the country to a deep economic crisis”

In an exclusive interview for IBNA, Arben Halili, expert of economic affairs and former head of the Economic Chamber of North-West Macedonia, talks about the real economic situation in FYROM and the consequences of the political crisis on the economic trends. Stopping on the political crisis, he underlines that it can have direct effects on the economic life in the medium term.

Interviewed by Naser Pajaziti

IBNA: How do you consider the political crisis and what is its effect in the economy aspect?

Arben Halili: In general, every crisis or lack of stability has its effects in both development and in the economy of a society. The direct effects are greater when there’s a political crisis and especially when they are long and when there’s no hope for an end. The political crisis which has affected Macedonia for several months, runs the risk of generating consequences that have a direct effect in the economic life of the country in the medium term. I say medium term, because in the short term, it’s already present in the business transactions between national businesses and the expansion of markets and the realization of capital investments. Delays in the last two activities will have an impact in the short term, because opportune cost will generate negative effects for the business in general on a national level.

IBNA: Why is the government reacting with counter effects and continuing with its campaign of different promotions in order to leave the impression that there are positive trends?

Arben Halili: At a time when the government has less room for action, when the opposition attacks are growing and when pressure from international community is mounting, the only form for the so called self defense against these attacks is to propose measures which would sound nice to the ears of the public opinion. The government is trying to cover its shortcomings with different promotion campaigns. The situation in the country is not positive at all. On the contrary we have problems in the economy on a national level in almost all the sectors. The government is trying to leave the impression that everything is going well. I’m sure that this management style is archaic.

IBNA: The Central Bank has issued signals for negative trends of inflation and the possibility of deterioration in the economic aspect…

Arben Halili: This is one of the factors which also relates to the previous question. At the moment when the Central Bank issues concrete signals that economic trends in the country are not going like planned, signaling a rising inflation and further deterioration of the economic crisis, the government wants to paint an unreal picture.

If this political insecurity will continue for around 1 or 2 months, I’m convinced that the national economy will live one of the most difficult years since the end of the economic crisis. This time, this crisis will only attack Macedonia.

IBNA: What is the urgent solution to make a positive turn and to improve the situation in the economic plan in the country, alongside the political solution?

Arben Halili: Unfortunately, without a sustainable political solution, we cannot hope for magic to happen in order to enable the recovery of the economy and to meet the projections of the Central Bank and the government for an economic growth of 3.5-4% for 2015. However, the more this crisis lasts, the more controlled would be the negative effects in the economy.

Therefore, first and foremost, the political players in the country must agree on solving the crisis within a period no longer than a year, a period which would be used to overcome different political problems on a national level, but which also presents a real opportunity to assure a long term solution for the name dispute between Macedonia and Greece. All of these processes can be conducted by a government which would include all relevant political forces in the country. Secondly, along with the political platform, the government must show within this period, that the state is able to manage such complex situations, in order for national investors to make their planned investments for this year, but at the same time, for foreign investors to consider Macedonia as a safe country for their investments and consider the free economic zones in the country. If businesses start to invest, I believe that other developments in the social aspect may feel the positive effects. /ibna/