New circumstances for yet another crisis, which unfortunately comes very fast and clashes with the existing one.
After all stress tests brought by the pandemic, we have a new reality which imposed new worries, fears, new challenges practically over night.
The economy is not directly exposed to the blows of both countries involved in the war but yet the fear and uncertainty “work” more than all wars.
The National Bank has calming attitudes about the “small trade and financial integration with both economies. The trade exchange with these two economies participates with only two percentage in the total trade exchange, and the connection is even smaller in terms of the financial flows. Coming from this context, it is clear that we would not experience more significant direct effects, including through the sanctions which are currently imposed”, says the governor Anita Angelovska – Bezhoska.
That arguments on why we do not expect more serious effects from the sanctions which envisages exclusion of the part of the banks from the SWIFT platform are also calming.
“The direct foreign investments from these two economies participate with only 0.5% in total but they do not exists in the area of the banking system. In these circumstances, this is an advantage for our banking system unlike other economies in our neighbourhood where the Russian banks are present, which banks face certain difficulties due to the new situation. Also, it is important to emphases the payment operations. Basically not all Russian banks are excluded, and also there are other alternative platforms which may be used to make the payments. Therefore I would say that we do not see any risks for our banking system and for the financial system in general, having in mind the minimal or non-existent connections with the financial system of the economies of Russian and Ukraine”, says the governor.
But this not seems to calm the ordinary citizen, although the media outlets intensively report these stands.
Large part of the citizens, under the pressure of fear, rushed to make reserves of flour and other most basic food products.
All calming tones of the authorities cannot calm the fragile peace of the people, because they are in an exceptionally sensitive situation, tired both financially and mentally, due to the long pandemic.
Especially after the statements of the economic experts about the indirect overflow of the effects, endangering some positions in export and import sense, indirectly connection with our European partners and markers as well as the disturbances which they bring.
The living standard suffered and will suffer again. That is more than clear.
Certain sectors will receive the blow and this also is more than clear.
For example, the tourism sector. How the new condition will influence during the new tourism season, when there was little hope, from the Russian and Ukrainian tourists as well as from easing the measures.
Now, that goes down the drain.
The situation will reflect not just on the number of tourists from Ukraine and Russian and other surrounding countries, but also on the domestic tourism because the decreased financial power, worsen living standard, inflation, energy crisis.
The experts suggests that having in mind that the business will suffer losses, it is very important for a mechanism to be put in place which will eliminate the dismissal of workers in order to avoid the creation of a new group of people with a low living standard.
The countries involved in the military conflict export energy products, resources, raw materials, minerals to all of Europe. That means increase of the import costs for every raw material of the manufacturers. This also disturbs the procurement chain because Russian and Ukraine dominate in many world-wide chains.
These countries are the biggest manufacturers of corn, wheat and oil plants that are of vital significance as raw materials in the food industry.
But we receive calming stands, that there is no space for panic, that we do have an alternative in countries like Serbia, Romania, Bulgaria, Hungary. Import from Serbia was already carried out.
However, we should be prepared for the consequences and infliences. The prices on the world markets for the main stock exchange products are already breaking records every hour. Therefore, it is necessary for the companies to adjust.
It seems that the most important topic about crisis management ended not that long ago. New test is coming up for the managers, and that if the lesson is learnt.
Although the consultants, even last year, and some even earlier from the beginning of the crisis, advised the managers to prepare right then and there for a new crisis, this massage was not received very seriously.
But the test and the new crisis came very fast. Now we will see who took the message seriously.
We hear the directions from the economists.
And those are to show calmness and to respond with good measure in order to ease the large quakes in the living standard, to help the economy by mitigating the energy crisis with all possible measures, to change the laws which impose administrative barriers, so they are lower the costs at least in terms of the issues related to the energy. They are prepared to invest in energy efficient solutions for the production capacities.
Although we do not export largely to both countries, we are indirectly connected with some chains of procurement in these countries.
The analysis of the Economic Chamber about the economic cooperation of the Republic of Macedonia and the Republic of Ukraine (from 2015) in terms of presence of products in the Macedonian and Ukrainian exchange shows that the exports relates to electric batteries and drugs.
In view of presence of the products in the import, those are flat and rolled iron products and non-alloy, other half-product from iron and non-alloy steel, carbon, cold rolled products, wires from refined cooper, then old seed and plants, poppy etc.
Ukraine is one of the leading world exporters of neon, gas which is key for lasers used in production of chips.
More than 90% of the neon for semi-conductors used in electronics plants in the USA comes from Ukraine.
According to the data from an analysis made by the Economic Chamber, 5% of the world mineral raw materials are located in Ukraine.
Ukraine has naturals resources of coal, manganese, natural gas, oil, salt, sulphur, graphite, titanium, magnesium, kaolin, nickel, rubber and agricultural land.
The deterioration of the living standard, especially in circumstances when the space for interventions by the state is limited, and the high indebtedness gives fear. Therefore, we need to be careful.
According to the economists, any eventual lowering of the costs like excise duties is not popular because the filling of the budget can be an issue. Therefore they call for further macroeconomic stability.
One is for sure, the economists speak loud that these circumstances will not allow economic growth; to the contrary it will cause lowering of the living standard, increase of prices, inflation even restrictive monetary policy, limited access to cheap sources of funding, increase of the interest rates which will affect the economy.
Others, such as Vladimir Gligorov, an eminent professor at the Vienna Institute for International Economic Studies, have argued that “we should not face accelerated inflation, primarily because the approach of summer will reduce energy demand and food or, there will be an increase in supply. It remains to see what will happen afterwards.
Having in mind all these views, it remains to believe in the claims that the budget is liquid, and the denar and the financial system will remain stable. The international developments and the movements on the world stock exchanges are closely monitored and it will reacted appropriately, assure the first people of the fiscal and monetary policy in the country, after the beginning of the Russian-Ukrainian crisis.
With all the assurances from the central and monetary authorities that the situation is under control, let us be “calm” and confident that this new crisis will be overcome.
We have already been to the solidarity economics exam once.
We remain to “pray” that this crisis will end soon..
М-р Марија Георгиевска
Уредник и водител на емисијата за бизнис и економија ПРОФИТ