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EC revises down Macedonia's 2018 GDP growth forecast - table

EC revises down Macedonia's 2018 GDP growth forecast - table Bradley Howard/CC BY 2.0

SKOPJE (Macedonia), November 8 (SeeNews) - The European Commission said on Thursday it has lowered its projection for Macedonia's economic growth in 2018 to 2.1% from 3.1% forecast in May.

"Output growth was driven by the strong pickup in exports in the first half of the year, offsetting a drop in investment," the European Commission said in its Autumn 2018 Economic Forecast report.

In the first two quarters of the year, Macedonia's real GDP increased by an average of 1.6% year-on-year, mainly carried by net exports, while import growth slowed, largely reflecting a 10% drop in investment, the Commission said.

According to the Commission, Macedonia's economic growth is expected to accelerate to 2.8% in 2019 and 3.1% in 2020.

“The recovery is expected to gain traction in 2019 and 2020, but at a slower pace than projected earlier, and to be increasingly driven by strengthening investment and a sizeable fiscal stimulus,” the forecast reads.

Risks to the baseline scenario are mainly on the downside, the Commission predicted, adding that, domestically, they relate to the possibility of political uncertainty, providing a renewed dent to investor confidence and postponing the expected pick-up in investment.

“On the external side, lower than expected external demand and escalating global trade tensions pose additional downside risks to the forecast,” the Commission said.

Details on Macedonia from the Autumn 2018 Economic Forecast follow (pct change):

  2018 2019 2020
GDP growth 2.1 2.8 3.1
Private consumption 2.9 2.9 3.1
Public consumption 1.1 1.3 1.3
Gross fixed capital formation -3.5 5.5 8.0
Exports 11.2 9.7 9.7
Imports 7.9 8.6 9.3
Unemployment 21.3 20.6 20.1
Harmonized consumer prices 1.6 2.0 2.1
General govt gross debt 42.2 44.5 45.7

Source: European Commission