Skills Policies for Economic Diversification in the Former Yugoslav Republic of Macedonia

The former Yugoslav Republic of Macedonia is a country with a small and open economy. Its trade represents about 90 per cent of the country’s GDP. Thus, exports play an important role in the country’s economic development, and the development of a successful export sector which can compete in foreign markets is critical given the small size of the domestic market (Kathuria, 2008). Consequently, the focus of government economic policies in recent years has been on improving the business environment, attracting Foreign Direct Investment (FDI), and promoting exports. Trade ‘openness’ has been extended over the last decade through the reduction of Most Favoured Nation (MFN) tariffs and preferential liberalization of trade with regional trading partners and the EU.