Economy of The Republic of Macedonia - History

History

Macedonia's economy has almost always been completely agricultural in nature from the beginning of the Ottoman Empire when it was part of the District of Skopje and Province of Salonika. It concentrated on pasture farming and vineyard growing. The economy shifted from agriculture to industry during the industrial age. Macedonia was responsible for large outputs of textiles and several other goods in the Ottoman Empire. However outdated techniques to produce the goods persisted. Macedonia was the economic heart of the Ottoman Empire in the Balkans throughout centuries until its fall in 1913. The stagnation of Macedonian economy began under the rulership of the Kingdom of Serbia.

When World War II ended, the local economy began to experience revitalization by way of subsidies from Federal Belgrade. The subsidies assisted Macedonia to redevelop its lost industry and shift its agricultural-centered economy to an industry-centered economy with new hearts of industry emerging all over the country in Veles, Bitola, Stip and Kumanovo. Previously, Skopje was the only industrial center in Macedonia, this expanded to several other cities during Socialist Yugoslavia.

After the fall of Socialist Yugoslavia, the economy experienced several shocks that damaged the local economy. Starting with the Western embargo on the Yugoslavian common market, and ending with the Greek embargo on Macedonia over the country's name. The economy began to recover in 1995 and experienced a full recovery after the 2001 insurgency by ethnic Albanians. Macedonia's GDP grew by an average of 6% on a yearly basis until the 2008 economic crisis when its economy contracted with the rest of the world. The global crisis had little impact on the country due to Macedonian banks' stringent rules. Macedonia today maintains a low debt-to-GDP ratio and is experiencing a revitalized investment interest by companies from Germany, France, Austria, and others.