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Europe and Eurasia

Macedonia Competitiveness Project (MCP)

Client: United States Agency for International Development

2007-2012

The five-year USAID/Macedonia Competitiveness Project (MCP) helped Macedonian companies and sectors respond to the opportunities and challenges of the global market with targeted interventions in market development, access to finance, workforce development, and innovation. Although the project took place during the global economic crisis and its tepid recovery, MCP achieved remarkable outcomes, meeting or exceeding nearly all of its performance indicators. MCP supported initiatives to stimulate foreign and domestic investment, capture higher value export markets, and generate new jobs for Macedonia. An integrated approach brought cost-effective, market-oriented solutions to sector-specific challenges as well those affecting Macedonia’s overall export growth. Activities were implemented on vertical and horizontal levels.

Vertical activities created new business and investment while enabling Macedonian companies and supply chains to better compete within a specific industry or market. Components included apparel, light manufacturing, and information and communication technology (ICT).

Horizontal or cross-cutting activities benefited multiple sectors and made Macedonia a more competitive place to do business. Components included access to finance, workforce development, and foreign direct investment (FDI).

The project generated $145.7 million in new investments (domestic and international) through the Financial Platform and foreign investment facilitation as well as $88.6 million in new exports through market linkage activities, and facilitated investments in products, technology, and working capital upgrades. In addition, the project made sustained and transformative impacts on the Macedonian economy and the ecosystem of services to help companies become more competitive, such as assisting over 75 firms in the adoption of modern management practices and/or technologies. The project also developed a market for the commercial delivery of financial and business advisory services, while facilitating $78.8 million in new financing. The model has been adopted by other USAID projects in Eastern Europe, Africa and Latin America.

MCP's market-led interventions involved:

  • A national internship program, MyCareer, was created to tackle the official 35% unemployment rate. The program uses a user-friendly website to match students and job-seekers with employers looking for interns and skilled workers. The program has placed more than 1,000 interns, hundreds of whom have been offered full-time jobs.
  • Market linkages with international companies resulted in new export deals and strategic partnerships involving joint business ventures, investment, and knowledge/technology transfer.
  • New foreign investment—green field, brown field, or joint venture—led to export-oriented job creation and the strengthening of supply chains and industries within Macedonia.
  • Financing—debt or equity—for Macedonian companies improved profitability, competitiveness, and market positioning through investments in capacity expansion, productivity upgrades, and product development.
  • Modern technologies and practices were adopted and compliance with certifications was obtained so that companies could perform and be seen as credible partners.
  • Investments were made in students and employees, resulting in a workforce with upgraded skills and flexibility.
  • MCP leveraged USAID funds through intensive collaboration with local implementing partners (who often offer in-kind services) and cost-sharing activities with project beneficiaries. Cost-sharing is a critical element to not only stretch available funds but also increase the likelihood of success and sustainability, as beneficiaries have a greater stake and ownership in the process.

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