Why Set Up Your Business in Macedonia?
Bordered to the north by Kosovo and Serbia, to the east by Bulgaria, to the south by Greece, and to the west by Albania, Macedonia is one of the countries of the south-central Balkans (The Balkans consist of Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Kosovo, Macedonia, Montenegro, Romania, Serbia, and Slovenia). Home to a population of around 2.8 million, Macedonia is a small, land-locked economy with a promising future.
An Overview of Macedonian Economy
Macedonia has been a member of the World Trade Organization (WTO) since 4 April 2003. In addition, Macedonia became a CEFTA member in 2006. Over the years, Macedonia has seen remarkable progress in liberalizing its economy and improving its business environment ever since its independence. Macedonia has an open market economy with one of the lowest GDP per capita in Europe. Services (more than 50 percent of GDP) and industry (30 percent of GDP) are the main sectors that contribute to economic growth. Meanwhile, the textile sector serves as the main source of foreign trade that accounts for more than half of total exports. Besides, Macedonia produces iron, steel, wine and vegetables.
Many European businessmen and foreign investors see Macedonia as an investment destination with stable macroeconomic policy, like one-stop-shop or 4-hour company registration, competitive low tax rates, open trade regime and free economic zones. Its competitive location has its geostrategic significance and it’s ideal for those who wish to expand their business and traipse into the regional market. The improved regulatory framework in Macedonia has created a stable environment for foreign and domestic investment. Although service sectors are the main driver behind economic growth, new investment in automotive parts manufacturing is growing and it is helping to diversify the economy.
Why Invest in Macedonia
Among many others, the low taxes, open market economy and supportive business environment, are the impetus behind the rapidly growing economy in Macedonia.
- Strategic geographical location: Macedonia benefits from the strategic location at the crossroads of two main European transport corridors, Corridor VIII (east-west) and Corridor X (north-south).
- Open trade policy: The highly-liberalized foreign trade policy in Macedonia as well as various bilateral agreements have offered investors free access to the European Union and other markets, transforming Macedonia into a competitive trading platform;
- Stable monetary environment: The stable monetary environment (with one of the lowest inflation rates in the region) and a stable currency in Macedonia are other factors that attract foreign investors;
- Good tax system: Another key that appeals the foreign investors is the sound tax environment with one of the lowest corporate income tax rates in Europe. On top of that, Macedonia has some Investment Zones with up to 10 years tax holidays for corporate profits, employment income, VAT, customs duties and others, all of which attract the attention of investors across the globe.
Being an export hub for the transport and distribution of goods between Asia and Europe, Macedonia is rising as the new investment paradise in Europe.
Here is the snapshot of why investing in Macedonia:
- A highly-skilled and motivated workforce
- Free and easy access to European Union market and neighboring markets
- “One-stop shop system” for company registration within 4 hours
- Ten-year tax holiday from profit tax for entities performing their business activities in the zones
- Certain exemption from value-added tax (VAT) for trade made within the zone and for imports in the zones
- Low corporate income tax.