Widespread poverty and unemployment, coupled with a deteriorating external demand environment as the eurozone economies remain mired in severe recession, risk aggravating the allure of populist and nationalist policies. This will make compromise with Greece over the disputed Republic of Macedonia name more difficult. ...opportunities The new government has a sound reformist base upon which to build its own agenda. If it is able to build a sustainable parliamentary coalition in favour of rapid economic and political reform, then growth will very likely remain solid, and integration with the Euro-atlantic institutions will be more likely to occur. The ---- election of a president who enjoys the backing of the ruling VMRO-DPnME party is expected to reduce president/government policy friction, potentially improving the pace of reform. ...BMi political risk ratings The formation of a coalition government seems very probable, boding well for policy continuity and with an increased mandate for the ruling centre- right VMRO-DPMnE, the policy-making process may improve. However, the main opposition Socialist Democratic Union of Macedonia (SDSM) continues not to recognise the election results of april --. as such, the risk of further parliamentary deadlock and the prospect of higher social tensions remain high.
...Macedonia s economic competitiveness and resurgent European demand will continue to see the current account deficit shrink in the coming years. That said, a gradual domestic recovery, which will see imports pick up, and the fragile state of the eurozone economy, mean that the bulk of the economic rebalancing has already occurred, and further current account deficit narrowing will proceed only moderately going forward. ...However, we warn � as we have done countless times during previous easing rounds � that the efficacy of ECB policy action will be limited absent structural reforms in the eurozone at the national and federal level. - Business Monitor International Ltd www macedonia Q- ---- chapter -: ---Year Forecast -- the Macedonian economy to ---- -- pursuit of continued reform s Will support steady return to Growth Macedonia s reformist trajectory looks set to generate solid GDP growth through to ---- amid steady convergence to EU political and economic standards. nevertheless, we caution that political uncertainties could yet pose risks to the longer-term outlook. ...nevertheless, we caution that political uncertainties could yet pose risks to the longer-term outlook. taBle: lonG-terM MacroeconoMic forecasts -- chapter -: Business environment -- sWot analysis -- BMi Business environment risk ratings -- Business environment outlook -- institutions -- taBle: BMi Business and oPeration risK ratinGs --
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