ADVOCACY
Summer 2016 / Issue 50
Foreign Investors Satisfied with Employees,
Suppliers & Tax Policy in Macedonia
By: Vlatko Stojanovski, Foreign Investors Council
Coordinator, Economic Chamber of Macedonia
F
oreign investors are satisfied with doing business in Macedonia and
84% of those surveyed
would invest again here,
if given the opportunity. This is the
conclusion of the latest survey
conducted by the Foreign Investors Council, on which 52% of its
members responded in the period
from March to April 2016 . Survey results were presented by the
Council President, Stefan Peter, at
a press conference held on May
23, 2016. “Proof that these are not
empty words is the decision of Van
Hool to open a second production line, as well as the announcement of Johnson Controls to build
another factory in Strumica,” said
Peter.
According to the managers, key
factors for doing business in Macedonia are: a qualified workforce,
the level of business expenses, tax
policy, legal stability, a stable business environment , the geostrategic location of Macedonia and
its proximity to the EU, as well as
its political and macro-economic
stability.
According to the survey, 68%
of companies managed to meet
planned business activities, 72%
do not expect any changes in the
implementation of their business
plans, and 20% expect improvement. Only 8% predicted their
economic performance to worsen
in the coming period, but they, as
Peter said, are mainly export-oriented and their business depends
on contracts for foreign markets.
Peter underlined that foreign
investors are satisfied with the tax
policy in Macedonia, high-quality workforce and stable business
environment, but they continue to
face, as reported in the survey, a
lack of legal, social and political stability. Problems include administrative procedures, frequent changes
in legislation and an insufficient fight
against corruption. For this reason,
84% of foreign investors believe
that Macedonia’s membership in
the EU would significantly improve
its business environment.
Foreign investors assessed that
the protracted political crisis in the
country will have long term consequences on the Macedonian
economy. “It is possible for foreign
companies to postpone investment
plans, which is expected. But if
the political environment stabilizes
quickly, it will not only attract new
investments, but will also help the
current investments to expand their
business activities,” noted Peter.
The Foreign Investors Council
has 118 members and marked a
decade of existence this year.
Work & Residency Permit Process Reform on Paper Only?
A
mCham has closely monitored the
expat visa, work and residence permit
process for several years now, since it
directly impacts a number of our members and is an important part of the
country’s efforts to attract FDIs. A new Law on Work
and Employment of Foreigners (LWEF) was adopted
and published in November 2015 and technically
came into force on June 19th, 2016. The amended
law introduces a single permit process, merging the
separate work and residence permits processes of
today. Disappointingly, though the law is technically
now in force, the process has yet to undergo any
noticeable improvements since institutional rulebooks, procedures and forms have yet to be issued.
International companies are extremely interested
in the full implementation of the new law because
the current expat visa and work permit process is
unnecessarily bureaucratic and inflexible. As detailed
in the summer 2015 issue of this magazine, this is
largely due to a lack of public investment in modern IT infrastructure to support modern and efficient
processing of payments and applications; a lack
of process transparency and predictability; and an equally
defensive approach to all types of visa and work permit applications out of step with the country’s FDI attraction goals.
The general hope among internationally-oriented businesses is that – once fully implemented – the new process
is going to significantly reduce and simplify the process of
obtaining permission to live and work here. Specifically,
Expats will only need to apply for a single
“work and temporary residence permit” in
one place: the Ministry of Interior (MoI);
MOI must approve/deny applications
within 15 days;
MoI (not the applicant) will obtain
an opinion from the Employment
Agency; and
The Employment Agency must
issue an opinion within 5 days,
if not, silence is approval.
AMCHAM MAGAZINE
19