COVER STORY EU Support Mechanisms for the Private Sector The Macedonian private sector can furthermore count on substantial EU support in this process. Several EU programmes primarily meant for EU Member States themselves are also open for Candidate Member States to benefit from. This concerns for example the programme supporting the competitiveness of small and medium sized enterprises (called COSME) and the Horizon programme, stimulating research and development in both the public and private sector. Through its Instrument for Pre-Accession (IPA), the EU in addition has an annual envelop of around 90 million available in grants, specifically earmarked for the country. A large part of this benefits the private sector through projects of a wide-ranging nature, from the development of entrepreneurship, joint customs facilities with neighbouring countries to infrastructural projects in the area of energy and transport. The private sector can furthermore profit from the recent 100 million lending operation of the European Bank for Investment, through which loans from the financial sector to small and medium sized enterprises are subsidised. In addition to support measures directly aimed at the development of the private sector, the EU also provides guidance for the country’s macro/ fiscal policy and for its structural reforms. A stable macro-economic environment and solid public finances are important prerequisites for any country’s business environment. Very similar to the existing practice with Member States, the European Commission assesses the so-called Economic Reform Programmes of candidate countries in which they outline their macro policies and structural reforms for the next three years. The European Council then adopts policy recommendations, jointly with the Governments of the candidates. This way the country benefits from policy advice based on best practice in the EU. This also concerns issues relevant for private sector development, such as the unfair competition that registered firms face from the informal sector, the enforcement of business contracts, and how to deal with the mismatch 14 EMERGING MACEDONIA between what skills companies are looking for in the recruitment of new employees and what new entrants into the labour market are equipped with following their completed education. To end, one can conclude that the EU accession process offers both challenges and advantages to the private sector. The main challenge for companies will be to develop the capacity to face the competitive pressure on the EU’s internal market. It is therefore important to look ahead and to anticipate new developments and consumers’ preferences. At the same time, EU accession offers many opportunities for domestic and foreign companies located in North Macedonia. Partly thanks to their competitive advantage on labour costs, many firms have already proved to be able to operate in the EU and this will only be facilitated by the country’s accession to the Union. In addition, when considering the positive impact previous rounds of EU enlargement had on the development of the private sector of acceding countries, it is realistic to expect similar possibilities for both local and international companies active in the country. More information about EU support programs for the private sector can be found on the web site of the EU Delegation.