Macedonian PM Admits Government Borrowed Funds to Repay Chinese Bank Loan
North Macedonia's Prime Minister Hristijan Mickoski has acknowledged that the government borrowed seven million euros from the state-owned company Macedonian Navigation (M-Nav) to repay a loan. M-Nav, a state joint-stock company responsible for air traffic control, collects funds that are then utilized by the government. Mickoski confirmed that the borrowed money, which also includes funds from other state enterprises, will be allocated towards settling a debt with a Chinese bank. This revelation follows recent reports about the government's financial maneuvers. The specific details of the loan from the Chinese bank and the total amount borrowed from state enterprises were not fully disclosed in the initial report. The government's reliance on state-owned companies for loan repayment raises questions about fiscal management and the financial health of these enterprises.
The Macedonian government's practice of borrowing from state-owned enterprises to service external debt, specifically a loan from a Chinese bank, highlights potential fiscal pressures and liquidity challenges. This approach, while addressing immediate repayment obligations, may indicate a reliance on internal state resources rather than market-based financing or direct budget allocations. Such inter-company lending can obscure the true extent of public debt and potentially strain the operational capacity of the lending state-owned entities. Future fiscal sustainability will likely depend on transparent debt management strategies and ensuring that state enterprises are not unduly burdened to cover governmental financial shortfalls.
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