Macedonia is the first country of the region to sign a stabilization and association agreement with the EU. In acknowledgement of reform efforts and the marked progress made by the republic, it was awarded candidate status in 2005.

Economic upswing

Despite considerable progress in modernising administration and the judiciary in Macedonia, further efforts are still needed in rule of law, decentralisation and institution-building. The economy poses another challenge. Compared with its neighbours, Macedonia affords locational advantages for business and industry: Training standards are high and a flat tax was introduced in 2007 on corporate profits and income. Nevertheless, many locations lack jobs.

Conflict prevention and administrative reform

In Macedonia, Austrian Development Cooperation (ADC) is committed to sustainable and socially equitable economic development. Specific projects are promoted in environment and water, energy and education. Conflict prevention and administrative modernisation are major areas of ADC involvement in Macedonia.

Austria has been engaged in Macedonia since 1996. Geographically, most measures are concentrated in the centre, North and Northwest of the country.