Overview of business landscape

Strategically positioned at the intersection of two key European transport corridors, North Macedonia offers an ideal geographical location for businesses seeking efficient access to European markets. The country boasts a well-developed road and railway infrastructure, ensuring swift access to every inhabited place in less than three hours, enhancing connectivity for businesses.

North Macedonia’s highly-liberalized foreign trade policy, coupled with numerous bilateral agreements, grants local producers’ free access to the EU and other markets. This positions the country as a highly-competitive production and export platform, fostering economic growth.

The stability of North Macedonia’s monetary environment, featuring one of the lowest inflation rates in the region, adds to its attractiveness for international businesses. The stable currency further contributes to the favorable business climate.

A favorable tax environment further sweetens the deal, with low corporate income tax rates, among the lowest globally. Investment Zones offer a remarkable 10-year tax holiday covering corporate profits, employment income, VAT, custom duties, and more. Personal income tax stands at 10%, corporate income tax at 10%, and general VAT rates at 18%.

The country prides itself on a skilled and competitive workforce, supported by investor-friendly government policies that create a conducive work environment. Fast company registration through an efficient one-stop-shop system within four hours facilitates quick and hassle-free business setup.

Additional incentives and benefits include a 10-year tax holiday for investors in free zones, a 100% reduction of personal income tax for up to a decade, exemption from value-added tax for import and trade of goods in free zones, and long-term leases of land for up to 99 years at concessionary prices.

Innovative Economic Centers: TIDZs & Growth Sectors

North Macedonia’s Technological–Industrial Development Zones (TIDZs) serve as hubs for concentrated and highly productive clean manufacturing activities and the development of new technologies. Beyond the standard benefits associated with free economic zones, the country provides additional incentives to foster growth in TIDZs. Investors in these zones enjoy a 10-year exemption from personal and corporate income taxes, as well as relief from value-added tax and customs duties on goods, raw materials, equipment, and machines. Financial incentives, potentially reaching up to €500,000, are granted based on the investment’s value and employee count. Land within a TIDZ is available for long-term lease, extending up to 99 years.

Further advantages encompass developed infrastructure, facilitating free access to natural gas, water, electricity, and a main international road network. Investors are also exempt from fees related to construction site preparation, while streamlined registration procedures in TIDZs contribute to reduced setup costs. The government places a special emphasis on production activities, IT-related endeavors, scientific research, and environmentally-conscious technologies within TIDZs, offering additional benefits for these sectors. Notably, investors in these areas are relieved from the requirement to provide collateral guarantees for any customs arrears. Overall, North Macedonia’s TIDZs present a compelling environment for investors seeking favorable conditions and support for innovative and sustainable ventures.

Workforce

North Macedonia presents a workforce that’s not only educated, highly qualified, and ethical but also enthusiastic about welcoming foreign investors. The country’s technical higher educational institutions align with Western standards, offering workers opportunities for continuing education and lifelong learning, often through customized vocational training. The Government actively supports investors by participating in labor force training programs.

Education

Mandatory elementary and high school education, along with English language education from the first grade of elementary school, is a cornerstone of North Macedonia’s educational system. The various vocational high schools in each city, alongside standard high schools, provide students with opportunities to learn diverse trades.

The workforce in North Macedonia is exceptionally talented and technically trained, especially in the areas of software development and information technology. Since a large number of the nation’s youth are highly educated and proficient in English, businesses find it simpler to compete internationally.

There are 22 universities in the nation in addition to over 80 high schools that prioritize science, math, and language education.

Salary and social contributions

The labor costs in North Macedonia are relatively low compared to Western European countries, which makes it an attractive destination for outsourcing activities. The average monthly salary is2023 is €925 which includes the net salary, personal income tax, and social contributions for pension and disability insurance, health insurance, and employment insurance. In the past few years, the Government of the Republic of North Macedonia has actively reduced social security contributions.

North Macedonia presents an attractive business ground comprising of two properties advantages; a favorable location ideal for trade activities, preferential treatment in the trading process which is reflected by freedom from special grants contributing to foreign investments and stable financing policies. From the Investment Zones to TIDZs, every part provides various lanes for development and imagination thanks to an encouraged workforce. The focus in the education system is on technical skills and languages which guarantee a labor supply of capable professionals to meet the requirements for driving industry needs. Feel free to Contact us to explore the possibilities and unlock the potential of your business in North Macedonia.