site.btaNorth Macedonia's Parliamentary Committee to Review Controversial Government Budget Update

North Macedonia's State Budget suffered a loss exceeding MKD 32 billion, Finance Minister Gordana Dimitrieska-Kochoska said at a press conference in Skopje on Wednesday. This disclosure immediately ignited a fierce debate with the opposition.

The revised budget allocates MKD 4.1 billion for salaries and MKD 5 billion for pensions. It projects an MKD 8.22 billion increase in total budget revenues, including a rise in tax revenues. Inflation is forecast at 3.5%, while net wage growth is expected to reach 13%. The forecast suggests a slowdown in inflation and stabilization of food and energy prices in the latter half of the year. The budget revision has escalated the deficit from EUR 580 million to more than EUR 700 million. This increase will be financed through new loans, raising the State debt to 68% of GDP.

The chair of the opposition Social Democratic Union of Macedonia (SDSM) Venko Filipče criticized the draft budget proposed by VMRO-DPMNE, due to absence of planned salary increases across all sectors.

"The implementation of the trade unions' demand for a minimum wage increase to EUR 450 appears unlikely, and the validity of collective labour agreements is under scrutiny. This situation represents a significant setback for employee rights and is deemed humiliating for workers," he said on Facebook. "These economic policies, initiated at the start of the term, are expected to lower living standards and introduce economic instability," he added.

Former deputy prime minister for economic affairs Fatmir Bytyqi also criticized the budget update, speaking of its negative impact on local businesses and the Government's lack of a systematic approach to economic challenges. He expressed concerns over the projected increase in the budget deficit and public debt, indicating a lack of fiscal responsibility.

In response to recent attacks, Prime Minister Hristijan Mickoski reiterated that the budget has a shortfall, with MKD 5 billion missing for pensioners and MKD 3.7 billion for farmers.