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- OPEC Fund boosts North Macedonia reform package with €50 million loan
OPEC Fund boosts North Macedonia reform package with €50 million loan
January 9, 2024: The OPEC Fund for International Development (the OPEC Fund) is supporting a multi-sector reform program in North Macedonia with a €50 million loan. The funding will bolster the climate transition of the energy and financial sectors and strengthen sustainable public finances. The OPEC Fund’s policy-based lending will be complemented by a US$100 million Development Policy Operation from the World Bank.
While North Macedonia is one of the youngest countries in Europe, it has inherited serious environmental challenges such as a legacy of heavy industry and the dependence on fossil fuels for the generation of power, heat and energy. Addressing these key issues, the government has launched a comprehensive reform program towards climate transition to improve efficiency and boost investments in renewable energy.
The country has been severely affected by the dual shocks of the COVID-19 pandemic and the war in Ukraine, which have negatively impacted macroeconomic growth. The reform program aims to get North Macedonia back on track by strengthening public financial management and safeguarding financial sector stability.
OPEC Fund Director-General Abdulhamid Alkhalifa signed the loan on behalf of the institution and said:
“We are very pleased to launch our public sector cooperation with the authorities of North Macedonia with this first sovereign loan in the country. Our funding demonstrates our strong belief in the government’s reform program as well as our readiness to support its implementation. Promoting climate transition means future-proofing the country’s economic and ecological system. We are proud to be partners in this key initiative.”
Fatmir Besimi, Minister of Finance of North Macedonia, added: “This loan in support of the Sustainability and Resilience Program will considerably boost our efforts towards the climate transition, while enhancing the stability and sustainability of our public finances.”
The funding will support the climate transition of the energy and financial sectors through improving energy efficiency, boosting renewable energy investments and increasing awareness and management of the impact of climate change. It will also strengthen the sustainability of public finances by safeguarding financial sector stability. As part of the program the authorities will also address issues such as fiscal sustainability and reinforcement of payment discipline in line with EU directives. The strengthening of the institutional framework is expected to bolster macroeconomic growth.
About the OPEC Fund
The OPEC Fund for International Development (the OPEC Fund) is the only globally mandated development institution that provides financing from member countries to non-member countries exclusively. The organization works in cooperation with developing country partners and the international development community to stimulate economic growth and social progress in low- and middle-income countries around the world. The OPEC Fund was established in 1976 with a distinct purpose: to drive development, strengthen communities and empower people. Our work is people-centered, focusing on financing projects that meet essential needs, such as food, energy, infrastructure, employment (particularly relating to MSMEs), clean water and sanitation, healthcare and education. To date, the OPEC Fund has committed more than US$24 billion to development projects in over 125 countries with an estimated total project cost of US$190 billion. The OPEC Fund is rated AA+/Outlook Stable by Fitch and AA+, Outlook Stable by S&P. Our vision is a world where sustainable development is a reality for all.