North Macedonia turns to GDP growth of 13.1% in 2Q21

North Macedonia turns to GDP growth of 13.1% in 2Q21
By bne IntelliNews September 6, 2021

North Macedonia’s economy grew by a real 13.1% y/y in the second quarter of 2021, reversing a 1.9% contraction in the previous quarter, estimated data released by the statistics office indicated on September 6.

The strong growth happened as a result of the low base effect as in the same period last year the economy registered the biggest drop of 12.7% due to the coronavirus (COVID-19) crisis, which prompted the government to introduce strict restrictions, including shutting down bars and restaurants.

GDP totalled MKD172.9bn (€2.8bn) in current prices in the second quarter of the year, up from MKD143.9bn in the same period a year earlier.

The biggest annual increase was registered in the wholesale and retail; transportation and storage; accommodation and food service sector of 46%, followed by the sector of mining and quarrying; manufacturing; electricity, gas, steam and air conditioning supply and water supply sector of 11.4%, of which only manufacturing increased 19.7%.

The IT sector expanded 5.7% in the second quarter, financial and insurance activities grew by 4.6% and real estate by 2.2%.

Only two sectors fell in the period under review, construction by 0.4% y/y and arts and entertainment by 0.1% y/y.

Household final consumption, including non-profit institutions serving households, increased 12.9%, while general government consumption went up 2.9% y/y. Gross capital formation jumped by 38.4% y/y.

In the same period, exports of goods and services went up by 45%, while imports of goods and services were 46.7% higher.

North Macedonia’s government projected GDP growth of 4.1% and annual average inflation of  2.1% for 2021.

In 2020, the economy contracted by 4.5% following a 3.6% growth in 2019.