Eurasia Press & News
Macedonia’s Finance Ministry on Wednesday denied media reports that it was holding secret talks with the IMF over a new loan to deal with a growing current account deficit.
Makfax news agency reported that a Finance Ministry official has responded to today’s edition of the newspaper Utrinski Vesnik, in which economic analyst Den Doncev wrote that the government had kicked off secret negotiations for a new arrangement.
Doncev said the government was “begging” the IMF for money after three years of uncontrolled public spending on unprofitable populist projects.
“This is not unexpected, at least to those who keep an eye on Macedonia’s macroeconomic situation” Doncev wrote, quoting official figures which say foreign currency reserves had fallen in value from 1.7 to 1.3 billion euro since last October.
He predicted that to get the desired 200-300 million euro from the IMF the government would have to scrap some projects, such as the planned building of a new concert and sport halls, and public statues. It would also have to cut jobs in the overcrowded public administration.
The IMF Office in Skopje neither denied nor confirmed the information. There is regular communication between the government and the IMF, which is normal for each member of this world body, one IMF staffer said.
Two years ago, the government completed the early repayment of the country’s debt to IMF but some observers say the country has since spent too much, amid a global crisis that has hit the home economy badly and cut foreign investments.
This year’s budget of over 2.5 billion euros is the country’s largest ever with a record 500 million earmarked for capital investments.
