A recent study indicates that strengthening institutions could significantly improve North Macedonia’s current account balance. The findings were presented at the 54th session of the Researchers’ Club at the National Bank.

The study identifies several factors impacting the current account deficit. Macroeconomic factors like the output gap, trade openness, and the real exchange rate play a significant role. Fiscal and financial factors, including public debt and money supply (M2), also contribute.

The research highlights the importance of institutional factors, such as efficient governance, quality public services, and the protection of economic rights, in addressing the current account deficit. The study suggests that improvements in these areas can lead to a more favorable current account balance.

Sultanija Bojcheva-Terzijan, Director of the Monetary Policy, Research and Statistics Sector, opened the session, emphasizing the importance of understanding the factors influencing the current account deficit, especially considering the country’s fixed exchange rate strategy. A sustainable current account is crucial for maintaining macroeconomic stability.

The presentation of the paper was followed by a discussion among participants. The next session of the Researchers’ Club is scheduled for September.