petar goshev : opening of the joint public information center of the national bank of the republic of macedonia and the world bank address by mr petar goshev, governor of the national bank of the republic of macedonia, at the opening of the joint public information center of the national bank of the republic of macedonia ( nbrm ) and the world bank, skopje, 16 december 2010. * * * dear ms. lilia burunchuk, director of the world bank office in skopje, dear mr. alexander tieman, imf resident representative for the republic of macedonia, your excellencies, dear guests, dear ladies and gentlemen! please allow me to greet you and express my pleasure that today we have the opportunity to attend two important events. the first, which we will gladly enjoy for a longer period of time – the official opening of the joint public information center of the nbrm and the world bank. and the second, the presentation of the annual regional report of the imf, an event which is always extremely interesting because it is an analysis made by a highcaliber institution, such as the imf. dear guests, the partnership of the republic of macedonia and the world bank lasts for nearly two decades. good results of this partnership are evident. the partnership by definition rests on the benefit for both parties, i. e. for all who gathered together in achieving a goal. i do not know which of the two sides, benefited more from the cooperation between the world bank and the republic of macedonia. but i strongly believe that the cooperation with the world bank has played ( and still plays ) very important financial and advisory role in strengthening the institutional capacities of our country and in boosting the economic development. the amount of capital invested by this institution in the republic of macedonia is known, in the years when it was most important to us, when our access to other sources of funds was incredibly difficult and much more expensive. reforms that were and still are implemented in our country with the assistance of the world bank are well known : the judiciary, health care, tax system, pension system, decentralization, increasing competitiveness, etc. the positive role of the world bank in the issues that are extremely important for us is clear, and we call it by the common name – structural reforms, a set of issues without whose advancement we would not have approached the doors of the euro - atlantic integrated systems. i think that for that contribution, i. e. the

of structural issues that are bottleneck for the growth of the macedonian economy. a comparative analysis shows that macedonia has pretty low level of investments ( on average about 15 % of gdp during 1997 – 2007 ). thus, further support which will lead to higher investments and higher stock of capital will play an important role for the long - term growth. we substantially lag behind those we want to keep up with. the unemployment rate is still staggering ( 32. 4 % ). income per capita is only half of the highest gni in the group, or only 33 % of the average gdp per capita ( ppp terms ) of the 27 eu countries. we have a strong need of funds and permanent technical assistance in order to continue with and accelerate our structural reforms. the greek example is a newest lesson. european and other funds, without all the painful and grave structural reforms, could not protect the country from facing the present crisis. however, it seems that, without structural reforms, they just boost the illusion. the recent crisis has highlighted the need for the international financial institutions to have adequate level of resources and flexible, innovative and swift technical infrastructure. it is a prerequisite for a well targeted, timely, coordinated and efficient response to global shocks. the strong increase of ibrd disbursements, policy based lending and advisory services in 2009, the dominance of social protections programs, on the background of the social implications of the crisis, pinpoint the rapid and well targeted adjustments in the lending policy and expertise provided by the world bank. the share of the world bank financial support to the region in the total wb financing in 2009 rose to 20 % ( compared to the average of 16 % for the previous three years ). significant weight was put on the enhanced social protection, regulation adjustment for the purpose of trade promotion, financial sector reforms and improved governance. dear guests, let me once more repeat that looking forward, the role of the world bank becomes even more pronounced. unprecedented policy support has yielded in tangible results reflected in improved global financial conditions and improved economic prospects. however, financial conditions are far from normal and growth prospects are highly uncertain and dependent on a policy support. the fiscal room has substantially narrowed and access to private financing is uncertain amidst high budget deficits and rising public debt. to be able to respond to the demand for its services a capital increase and reconsidering priorities in the region seems inevitable. although current situation calls for immediate assistance to protect poor and vulnerable people from the hardship they are