WORLD TRADE  
ORGANIZATION   
G/SCM/Q2/MKD/4 
23 August 2012 
 (12-4558) 
Committee on Subsidies and 
Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
Replies to Questions posed by the EUROPEAN UNION1 regarding the New and Full  
Notification of THE FORMER YUGOSLAV REPUBLIC OF MACEDONIA2 
  
 The following communication, dated 21 August 2012,  is being circulated at the request of the 
Delegation of Macedonia.   
 
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Under Section:  TEXTILE INDUSTRY 
 
Title: Programme for Support of Textile Indus try in the Republic of Macedonia for 2010 
 
Question 1 
 
 Please define the eligibility criteria. 
 
Reply 
 
 There are no specific eligibility criteria for allocation of funds under the Programme.  All 
conditions for allocation were described in de tailed in publicly available announcement on the 
Ministry of Economy web page.  Financial support could be used only by companies that achieved 
positive financial results in operations for the previo us year. Also, the companies - applicants had to 
provide self participation of 25 per cent of the requ ested amount.  The applications have been selected 
on a "first come first served" bases by the Ministry of Economy to the completely exhausting of funds 
from the Programme.  
 
Under Section:  COMPETITIVENESS PROGRAMMES 
 Title: Macedonian Bank for Development Prom otion Loan for Small and Medium-sized 
Enterprises and Priority Projects (Credit line with European Investment Bank) 
 
Question 2 
 
 Please provide information on the production industry subsectors supported.  
 
 Please also explain the terms on which the loan is granted for export oriented 
production and whether this is in conformity with Article 3.1.a of the SCM Agreement.   
                                                      
1 G/SCM/Q2/MKD/3.   
2 G/SCM/N/220/MKD. G/SCM/Q2/MKD/4 
Page 2 
 
 
  Reply 
 
 The sectors supported by European Investme nt Bank credit line were the following:  
 
Structure of EIB I and II loans by activities EUR % 
Production (food, textile, other) 78,839,269 53 
Trade 34,261,149 23 
Construction   9,660,693 6 
Transport 8,569,959 6 
Health and education 8,263,028 6 
Hotels and restaurants 4,086,344 3 
Services 2,697,531 2 
Other 3,622,027 2 
Total: 150,000,000 100 
  The activities that may not be funded are defined by the EIB credit line (weapons, gambling, 
cloning, environmentally unacceptable projects, etc.) while all other projects and companies including 
export-oriented companies are eligible under the equal determined credit terms and conditions.  
Therefore the loan granted for export oriented production does not present pr ohibited subsidy referred 
to in Article 3.1.a of the SCM Agreement.   
 In addition are given the conditions set by EI B credit line for final beneficiaries and it should 
be noted that this credit line is realizing through commercial banks. 
 
1. SME Investment Credits of EIB credit line 
 
Single credit amount intended for final beneficiary  Minimum amount 10,000 EUR 
 Maximum amount 3,500,000 EUR 
Installment period Up to 8 years 
Grace period Up to 24 months 
Interest rate for final be neficiary 5,5% annual fixed 
Use Support for identified project  as follows: 
 Purchase of material assets: 
-Real estate 
-Equipment 
- Working capital (no more than 30% of capital value) 
 Non material assets investments 
(development, planning and funding in the 
phase of construction as well as expenses for 
salaries and other connected to investigation phase and development )  
 
2. SME Working Capital Credits of EIB credit line  
 
Single credit amount intended for final beneficiary  Minimum amount 5,000 EUR 
 Maximum amount 666,700 EUR 
Installment period Up to 3 years 
Grace period Up to 6 months 
Interest rate for final be neficiary 5,5% annual fixed 
Use  Support for requests on permanent increase of 
working capital needs in expand business 
activities conditions  
  G/SCM/Q2/MKD/4 
 Page 3 
 
 
  3. SME Priority Projects of EIB credit line 
 
Single credit amount intended for final beneficiary  6,000,000 EUR 
Installment period Up to 8 years 
Grace period Up to 24 months 
Interest rate for final be neficiary 5,5% annual fixed 
Bank participation in credit support of project Minimum 50% 
Use Support of project in the field of knowledge 
base economy, energy, environment, industry, tourism, company projects with more of 
250 personnel.  
 
 
Under Section:  REGIONAL STATE AID 
 Title: "Law on Technological Industrial De velopment Zones", published in the Official 
Gazette of the Republic of Macedonia No. 14/07, 103/08, 130/08 and 139/09 
 
Question 3 
 
 Please specify the eligible expenditures.  What subsectors of economy and how many 
enterprises have been supported? 
 Reply 
 
 In 2010 only two companies received regiona l state aid – Johnson Controls and Johnson 
Matthey.  Both of them are manufacturers of au tomotive components.  The following investment 
expenditures are regarded as eligible, ac cording to the State Aid Contracts: 
 
 expenses for construction of all buildings and facilities required for the Investment Project, 
including all expenses made in the planning and construction process; 
 expenses for technical equipment for the pr oduction facilities required for the Investment 
Project; 
 expenses for technical equipment and software for procuring functioning of the batching and 
waste process; 
 expenses for equipment for preservation of environment and for compliance with 
environmental laws; 
 expenses for software and other licenses and for other intellectual propert y rights related to 
the equipment and the quality control of  the second contractual party's products.  
 
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