Dear guests, The fact that the leaders of this Fund offered to present their financial services in the Republic of Macedonia, the Central Bank certainly encouraged and supported this initiative, shows that these important partners consider the Republic of Macedonia a friendly environment for launching various mutually beneficial business initiatives and projects. Yet, we do not forget though, that some of these institutions had no doubts whatsoever about the Republic of Macedonia even in the most difficult periods for us after gaining the independence, since when nobody else was coming, they were here. We certainly appreciate that. Regardless of all above, we still have many reasons that urge us to notice and convince others why is it good to invest in the Republic of Macedonia and to develop partnership with our economic agents and, of course, to inform on the activities that all of us in our country perform, directed towards increasing the attractiveness of the Republic of Macedonia as investment destination. Hence, we definitely need such financial offers. The economic growth could be accelerated by more investments, competitive offer of financial instruments and products, which are likely to eventually bring about lower costs for borrowing capital. The potential investors should be aware that the Macedonian financial sector is booming, but that the room for investments is yet to be opened. The gross national savings is low, not more than 12-17% of GDP, over the recent several years.
The country is therefore saving today in order to consume in the future. Moreover, it is more profitable for Japan to invest abroad since there are fewer domestic investment opportunities and growth prospects are muted. Japan therefore exports capital abroad and has a current account surplus. There are thus structural reasons why countries have a current account balance above or below zero for an extended period. Surpluses or deficits therefore do not necessarily indicate an overvalued or undervalued currency, or present a risk for the country and the global economy. 5 How can we distinguish between those current account surpluses or deficits that can be explained by fundamental factors, and those that cannot? The IMF has developed a model for conducting a thorough analysis of the impact of various economic drivers on individual countries’ current account balances. These drivers include demographics, the level of development of a country, and fiscal policy – in other words, factors that influence savings and investment. The results of the model are incorporated into an annual report, the External Sector Report, which I mentioned in my introduction. Nevertheless, it is not enough just to apply the model in a mechanistic way. The IMF therefore also takes country-specific circumstances and features of balance of payments data into account in its assessments. In Switzerland’s case, it concludes that the current account surplus is in line with macroeconomic conditions and is not the result of an undervalued currency or inappropriate monetary or fiscal policy.