Macedonia - Industry

Industry (including mining) contributed 32 percent of GDP in 1998 and employed about 40 percent of the workforce. While the coal industry provides for the needs of the country, all other fuels, machinery, transportation equipment, and manufactured goods are imported. Manufacturing is dominated by metallurgy (iron, copper, lead, zinc, and chromium), chemicals, and textiles. Many companies have been able to keep operating despite losses and delayed payments to workers and business partners. But the VMRO-DPMNE government has planned the sale or liquidation of seriously insolvent companies by 2002. Feni, a ferro-nickel plant in Kavadarci, was sold for $2.3 million to France's Société Commerciale de Métaux et Mineraux, which will invest $36 million, while retaining all 880 employees and selling metals to Krupp Thyssen of Germany. The privatization agency is trying to support the selling of other loss-making companies, such as the Okta oil refinery, by cutting selling prices substantially.

Increased demand for post-war reconstruction in Kosovo has improved the situation in the iron and steel, construction materials, and chemicals industries, and, ironically, neighboring EU member Greece, which imposed a crippling trade embargo in the early 1990s, is now the top source of foreign cash directed to banking, fuels, brewing, tobacco processing, and construction materials.