the transition report, which primarily focuses on digitalization. this does not come as a surprise knowing that digitalization has been significantly boosted during the pandemics, bringing a number of benefits to the societies, including support for faster transition and income convergence. despite the efforts, income gap of the western balkan economies in comparison with the eu still remains wide - regional income is only about 38 % of the european income. this largely correlates with the level of productivity in the region that significantly lags behind the eu productivity. and, the increase in productivity can be achieved only by structural and institutional reforms, including digitalization that can lead to more efficient allocation of resources. thank you. 3 / 3 bis - central bankers'speeches

anita angelovska bezhoska : opening and closing address presentation of the ebrd transition report 2021 - 22 opening and closing address by ms anita angelovska bezhoska, governor of the national bank of the republic of north macedonia, at the presentation of the ebrd transition report 2021 - 22, skopje, 24 march 2022. * * * opening address dear colleagues, ladies and gentlemen, at the beginning let me thank you for the kind invitation to address you at the launch of the latest transition report that analyses and measures the progress of transition economies on their way towards higher income levels. it is indeed my privilege. for us, in the transition world, the report has always been an important guideline, both with respect to advices on how to address the deep - seated structural issues, but on cutting edge maters as well. in the current context, it even gets more prominence by providing valuable insights in the extent to which the unprecedented shock have derailed policymakers from structural agenda, which is a key precondition for faster transition. similar to most of the countries in the world, the emergence of the pandemic has hit macedonian economy severely. although it caught us on a strong footing with solid economic fundamentals and absence of any significant disequilibria, the economic activity plunged by 6 % - which has not been observed in the last two decades. despite the rebound during last year, not all economic losses were recovered. the economy is still below the pre – pandemic level, and even more importantly, the growth outlook is under new threat in the midstream of the recent upheavals in ukraine. subsequent shocks and the need to respond in crisis management mode increase the risk of distancing from structural policies that provide impetus to a faster transition and more productive growth. however, growth decomposition exercise reveals that even before the health crisis, the growth of the macedonian economy, similar to the growth of other cesee transition economies, was not predominantly driven by innovative and efficient sources. the average growth in the decade preceding the pandemics gravitated around 2. 5 %, somewhat above the cesee average, with the contribution of total factor productivity ( tfp ), as a measure of economic efficiency and innovation, being relatively marginal. although two thirds of growth dynamic was capital driven, the impact of the ict capital was rather small. labour had also positive contribution to the growth, but it was predominantly due to labour quantity, and