Marjan Nikolov, President, Center for Economic Analyses,Skopje, Former Yugoslav Republic of Macedonia and Assistant Professor, International Slavic University of Macedonia
The regional organization in Macedonia is in accordance with the NUTS III level as the NUTS I and NUTS II is the Republic of Macedonia. In Macedonia there are 8 statistical regions which are only statistical and administrative in nature regulated with the Law on balanced regional development (Official Gazette of the Republic of Macedonia, no. 63/07). Line ministry responsible for balanced regional development is the Ministry of local government and the Bureau for regional development that operates within the ministry.
The relatively balanced regional development in Republic of Macedonia creates concerns because the disbalance is growing in the last years (from 2011 until now) as measured by GDP variation coefficient across the 8 planning regions. The policy weaknesses on top of disrespecting the Law in budget planning of 1 % of GDP for balanced regional development context, are the low budget realization capacity from the Bureau for regional development and from the Centers for balanced regional development for the regional capital projects. Namely, the planned finances for balanced regional development are less than 0.02% from the GDP, and the realization of the projects panned by the Bureau was low in the past few years.
The convergence analysis of the planning regions in Macedonia in their development require more exhaustive empirical analysis, but one starting analyze was made by the Center of economic analyses within the project framework Alliance for Regional Development implemented by Forum CSID and Youth initiatives for dialogue and cooperation in Macedonia. The following variables are identified in the analysis that might have significant influence in setting up policies for balanced regional development in Macedonia as measured by the GDP per capita: population and population density, urban/rural municipal difference in regions, migration, (un)employment, time and graduated students, number of internet users as proxy for skills and knowledge (taking in mind that regions and their centers have low capacity for realizing the planned budget for capital projects with regional component).
Even though the analysis is only initial and indicative, there are estimations made where independent variables are the social and economic variables and the GDP is the dependent variable. The vector of panel data estimation estimated was:
y – dependent variables i.e. GDP on the planned regions.
x – explanatory variables (number of urban/rural LGU, people age from 15-74 who use internet, number of graduated students, unemployment rate, average net salary per employee, time for period from 2010-2015 population).
The results from this estimation show that for the GDP variation the graduated students as well as the time are statistically not important. On the other hand 1% statistical significance show the number of urban/rural municipalities per regions for the GDP variation illustrating that the urban and/or rural regional profile in Macedonia is significant in policy-making for the convergence of the GDP per regions in Macedonia. It is important that the model empirically shows that a larger number of urban municipalities leads to higher GDP in regions, and a larger number of rural municipalities leads to lower GDP in regions. More about this study one can read here: https://forum-csrd.org.mk/wp-content/uploads/2017/09/Publikacija_FinalShrinked.pdf