Government asks domestic bank for €70 million loan
Decision for long-term borrowing from Sparkasse Bank published as the state also planned a €150M mini-eurobond and a budget rebalance is debated.
The Government has approved long-term borrowing of €70 million from a domestic lender to cover budgetary needs, a decision that has been published on the Government’s official legal acts register.
The loan will be contracted with Sparkasse Bank; the precise terms and repayment schedule will be set out in the contract between the state and the bank. Officials say this borrowing adds to other sources of financing already in use, such as domestic government securities and international market issuances.
Concurrent international borrowing and political pushback
Separately, the state recently approved borrowing €150 million on foreign markets through a so-called mini-eurobond with a 5.25% interest rate to refinance external debt. Finance Minister Kochoska told reporters during the presentation of the budget revision that the planned foreign borrowing had been larger, but market conditions forced a reduction in size.
The loan decision arrives while parliament is debating amendments to the new budget. Main topics in the amendment debate include the fresh state borrowing, support for domestic companies, capital investments and the fiscal deficit.
Opposition and ruling-party MPs traded sharp accusations. SDSM MP Fatmir Bitiqi said: "Read the budget and you will see how you are cutting money for domestic companies. You changed the law on financial support and because of that you owe 170 firms 750 million denars; this year you were supposed to sign 210 new contracts — according to my information 90 percent of those contracts are close to VMRO-DPMNE. And one more thing, ask the minister today why she is taking €70 million from domestic banks, because there is no money."
VMRO‑DPMNE MP Brane Petrushevski responded: "In your time only companies from Strumica received help through the Innovation Fund, and regarding Bechtel and Enka and corridors 8 and 10D, I do not know what you did, other than one mother and one smoke bomb and you did not even have a single bolt driven in."
The revised budget keeps the deficit unchanged at 4.1% of GDP. Public debt currently stands at almost 59% of GDP, and documents project it will exceed 60% by 2028, crossing the red lines. Revenues and expenditures are both trimmed by €86 million, with the energy and environment sectors facing the largest cuts. Economic growth is projected at 3.5% and inflation at 3.8%.
Article by Irena Čačkova.
Photo: press material from the event
