Eurozone Headwinds Threaten Recovery

The Macedonian economy looks to be on the path to recovery, and we forecast a return to growth of 1.2% in 2010. A vastly improved investment climate, a sound banking sector and ongoing convergence with the EU should lay the foundation for robust growth going forward, and we expect GDP growth to reach 5.5% in 2014. External instability, especially in the eurozone, presents the biggest threat to the domestic recovery, as weak demand weighs on Macedonia's exports and the increased risk drags down investment across the region.

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