The Macedonian Economy, Past and Present
In the last century of Turkish rule Macedonia was economically an agricultural country. The economy of the Turkish province of Macedonia was characterized by primitive and backward production and by barter. Crafts and mining were primitively organized and used inefficient and dated techniques. Production of goods in Macedonia did advance somewhat in the latter part of the 19th century when the province entered Mediterranean and European trade networks. European centers sought Macedonian wool, leather, silk and cotton to feed their blossoming textile industries. Macedonian craftsmanship improved as well: the sharp increase in demand for agricultural and livestock products encouraged landowners to increase production of consumer goods, which in turn led to greater use of money rather than barter.
This had the positive effect of increasing the production of certain agricultural products. In the beginning of the current century in the vilayets of Bitola, Thessaloniki and Skopje, 707,575 hectares of land were sown with grain crops, including 232,571 hectares of wheat and 180,539 hectares of maize. 113,900 hectares of Macedonian farmland were dedicated to tobacco; tobacco production represented 40 percent of the overall agricultural production in Macedonia, and tobacco products 78 percent of Macedonian exports. In the latter half of the 19th century the annual production of cotton climbed to 1,700,000 okes (a Turkish weight measure; 1 oke is equal to three pounds). The production of poppies by 1900 reached 500,000 kilograms a year. By 1910 there were about 70,000 hectares of vineyards, producing 137 million kilograms of grapes a year. Herds of livestock were increased, with 250,000 people managing 7,300,000 head (6 million sheep, 1.3 million cattle) by the Balkan Wars.
The formation of a state in Vardar Macedonia at the end of 1944 provided possibilities both for the renovation of a region devastated by war and creating a completely new economic structure. In fact, development had to start from the ground up since the development of a modern economy on the territory of the present-day Republic of Macedonia had been feared-economic development might undermine the stability of the pre-war Kingdom of Yugoslavia. Authorities had correspondingly been attempting to impede economic development in the region; Macedonia entered the new federal Yugoslavia not only as a region devastated by war, but as an underdeveloped region within the new federal Yugoslavia. After liberation, investments in the economy-particularly in industry-helped the Republic of Macedonia gradually develop an industrial economy.
Today, Macedonia is considered to be a intermediately-developed industrial country, considering employment figures and the share of the gross national income of each branch of the economy. This is best illustrated by some concrete examples: the social product for the Republic in 1993 (at current prices) amounted to roughly 60,411,085,000 denars, while the national income amounted to some 518,666,630,000 denars. The social product breaks down per capita to 709 US$, among the lowest in Europe-and much lower than the per capita social product of 1,197 US$ in 1989. Social, cooperative and mixed sectors of the economy represent 498,838,343,000 denars of the 1993 social product, and the private sector 10,527,251,000 denars. The same year, the social, cooperative and mixed sectors realized 42,016,546,000 denars of the national income, and the private sector 98,500,117,000 denars.
A clearer picture is gained by presenting the social product of the Republic of Macedonia in the table number 1 in Appendix I.
In 1993, the export of industrial products amounted to 739,399,000 US$, while the import of such products reached the figure of 506,516,000 US$.
Generally speaking, the growth of industrial production in the Republic of Macedonia has continually increased. If, for example, the industrial production of 1939 is taken as an index (1939=100), then by 1946 it had increased to 105 (indicating Macedonia had industrially recovered from the effects of World War II and added some slight growth as well), in 1951 reached 266 and in 1961 reached of 999. This had its own effect on the increased participation of industrial production within the social product.
But in 1994 industrial production decreased by 10.5 percent from the 1993 figures. Table number 2 in Appendix I clarifies why.
Industry In 1994, the production of electrical power in the Republic of Macedonia reached the figure of 5,923,666 megawatt-hours (683.279 MWh from hydroelectric stations and 5,240,387 MWh from thermal-power stations).
Imports-exports. In 1993, total exports from the Republic of Macedonia amounted to 1,055,299,000 US$. Imports increased roughly 65 million US$ to 1,119,351,000 US$, for an trade imbalance of some 60,052,000 US$.
Mining and industry dominate the import-export trade of Macedonia. The total value of exported industrial products and ores in 1993 was 739,399,000 US$, while imported products in the same sector were valued at 506,516,000 US$. In 1993, Macedonia could boast export-import ratios as shown in Table 3 in Appendix I.
Mining. Mineral resources in Macedonia have been exploited since ancient times. Ancient peoples in Macedonia utilized iron, copper, lead, gold and arsenic, as confirmed by archeological excavation of ancient mines, slag and known written records. Gold was panned along the banks of the Konjska River near Gevgelija and in the Kratovo-Zletovo region. The exploitation of mineral resources in Macedonia continued at a lower level during the Middle Ages, prior to the coming of the Sassians. The Arabian geographer Idrizi mentions Kratovo as a mining town in 1153.
A hundred years later, the arrival of the Sassians to Macedonia initiated a renewed surge in the utilization of Macedonian mineral resources, especially those in the Osogovo mountains and in Kratovo, Zletovo and Sasa-Tarinci. Even during Ottoman rule Kratovo remained an important mining center: in 1550, this town contributed 70,000 gold coins to the Ottoman treasury, while a hundred years later the amount was to reach the figure of seven million aspers.
Towards the end of the last century the mining of chromium, arsenic and antimony ores was intensified in Macedonia. The total pre-1944 production of Macedonian chromium mines amounted to over a million tons. Following the liberation of Macedonia in 1944, particular attention was paid to mining in Macedonia. In 1947, the first Macedonian Institute for Mining and Geological Research was established in Skopje. The extensive exploitation of mineral resources formed the basis for development of a number of industrial branches, and provided raw materials for new industries.
Agriculture and livestock. Agriculture has largely given way to industrial development in the Republic of Macedonia; still, a significant part of the population remains engaged in direct agricultural production: about 650,000 people or roughly 40 percent of the population as a whole. Production in 1993 included 249,789 tons of wheat (at 2.135 kilograms per planted hectare) and 101,063 tons of corn (at 2.261 kilograms per planted hectare), by which Macedonia nearly satisfied its own requirements of these two staples.
The total surface of utilized agricultural land is 1,299,124 hectares, including 634,209 hectares of meadows and pastures, 553,050 hectares of arable land and vegetable gardens, 21,053 hectares of orchards, 33,361 hectares of vineyards. The remaining difference is composed by marshland and reeds.
In addition to the staple crops mentioned above, in 1993 24,002 tons of tobacco-"green gold"-were produced (at 1.123 kg per hectare); 123,170 tons of fruits; 127,992 tons of grapes; 55,102 tons of sugar beets; 18,841 tons of sunflowers; 125,672 tons of tomatoes; 30,853 tons of onions; 3,097 tons of garlic; 107,763 tons of potatoes; 21,135 tons of beans; 125,575 tons of paprika; 88,762 tons of melons; and 53,447 tons of cabbage.
Raising livestock is an integral part of Macedonian agriculture. In 1993, the dairy industries produced over 178,030,000 liters of sheep and cow milk; the meat and poultry industries accounted for 513,000,000 eggs and 34,009 tons of assorted meats. Herds in Macedonia include 280,324 cattle, 2,458,648 sheep, 184,920 pigs and 4,392,721 poultry.
In terms of mechanization of agriculture, public industries possess a combined total of 3,993 combines and tractors and private industries 44,253 combines and harvesters for a combined total of 47,581.
Transportation. Pontochartus' table, a map of Roman roads dating from the 2nd century A.D., clearly shows that several routes connecting the East to the West passed through Macedonia-routes of key economic and strategic importance for the Empire. Via Ignatia, for example, connected Rome with Thessaloniki, Constantinople and the Near East by way of Dalmatia, Albania and Macedonia. Throughout Roman Macedonia, an extensive network of roads was built, connecting the province to major road arteries. Of importance were the road forking from Via Ignatia, branching near Prilep to Stobi and Bylazora (Titov Veles). The ancient town of Stobi was an important strategic center where several roads crossed, as was Scupi (present day Skopje). The collapse of the Roman Empire triggered a gradual decay of this extensive road network in Macedonia. The small states which were formed during the settlement of the Slavs and prior Ottoman conquest of these territories did not undertake maintenance of the roads. During the time of the Ottoman Empire the roads remained as poor as when the Turks had found them during the initial conquest: bad during the summer, impassable in winter.
In the period from 1919 to 1941, 1,158 kilometers of roads were constructed in Vardar Macedonia. Following World War II, particular attention was paid to the development of the road network, and Macedonia is currently crossed by 9,257 kilometers of roads.
In the course of the last two years, particular interest has been paid to plans to create new East-West linkages through Macedonia. The Republic of Macedonia's Highway Department has cooperated with the appropriate departments in Albania and Bulgaria in planning a new East-West corridor crossing Deve Bair to the border crossing at Kyafasan. 25 of this 302 kilometer total have been completed from Tetovo to Gostivar, 20 from Kumanovo to Miladinovci and 5 from Miladinovci to Hipodrom, and construction conditions in the remaining 80 percent are relatively good.
As roads have been modernized and living conditions in Macedonia improved, the number of motor vehicles in Macedonia and the transport of passengers and goods have increased. In 1993 there were 289,979 cars in Macedonia, 275,339 in private ownership. 20,104 freight vehicles rumbled throughout Macedonia in the same year, joined by 2,921 buses-a vast improvement from the 35 rickety buses which Macedonia boasted in 1946! In the course of 1993, buses and taxis served for 24,079,000 individual passenger trips, and 3,801,386 tons of freight were hauled.
In 1873, the first railway line in Macedonia was built with foreign capital-the Thessaloniki-Skopje line. The following year the Skopje-Mitrovica railway line was added, joined in 1878 by the Skopje-Zibevche line and in 1894 by the Thessaloniki-Bitola line. In 1993 this had grown to 105 railway stations in the Republic of Macedonia, 922 kilometers of track, and selling nearly 1,144,000 tickets annually.
Communications. Philip II organized the first Macedonian network of postal messengers, used to speed the delivery of military information. Alexander the Great paid great attention to the postal services, as they allowed him timely reports over the events in his vast empire. It is interesting to note that the emperor regularly sent letters to his mother Olympia, advising her of many details concerning the invasions he undertook. Owing to the strategic position occupied by Macedonia, the Romans needed the fast conveyance of information and messages. For that purpose, three large mutatziones or postal stations were built, including rooms for overnight accommodation, as well as a number of mansiones, roadside stations placed at close distances for quick replacement of harness or horses.
During the reign of Tsar Samuil there were two kinds of post offices: military and civil. After the conquest of Macedonia by the Ottomans, the new rulers were particularly interested in maintaining postal traffic, especially in the 16th century when expansions halted and it was necessary to stabilize the empire. In the 18th century, Turkish authorities established post offices in Bitola, Skopje, Debar, Prilep and a few other large settlements in Macedonia. By the beginning of the 19th century the Ottomans had begun to allow other states to establish postal service within its territory, enabling the rapid development of the postal traffic in the Balkans lasting until the collapse of the Ottoman Empire. During his travels through Macedonia in 1816, the German writer Von Schtrimmer noted that "Each postal station where I stayed during my travels was supplied with horses."
Ottoman authorities opened their first telegraph lines in 1856 and the first telegraph on the territory of present-day Macedonia in Skopje in 1899. The first regulations regarding post offices and their establishment in the Ottoman Empire were passed in 1869, and two years later the first postal regalis in Turkey were opened, with a regalis established at the same time in Skopje. In 1900, nearly thirty post offices were operating in Vardar Macedonia, including offices in Skopje, Bitola, Prilep, Tetovo, Ohrid, Kumanovo, Kriva Palanka, Resen, Strumica, Shtip, Gostivar, Veles, Kochani and Krushevo.
In December 1940, an automatic telephone exchange with 1,400 connections installed in Skopje, with a hundred additional connections in Kumanovo. After the liberation of Macedonia in 1944, postal services in Macedonia were in poor condition. Yet by the end of October 1945 normal and regular postal traffic was established with nearly all European countries and by 1951 35,001,000 parcels and letters were being transferred annually. In 1991, the volume of letter mail alone surpassed the figure of 24 million!
At present, the public enterprise PTT Makedonija-Skopje incorporates a network of 271 post offices and stations with an average of 8.125 inhabitants per post office and total service to 1,579 localities. In the second half of 1991 the first Macedonian postage stamp was issued, and more than 60 postage stamps and three commemorative stamp sets have been issued to date for a total circulation of about 25,000,000 copies.
In December 1992, a new digital international and transit telephone exchange was put into operation, with a capacity for 4,800 calls. All international traffic is now conducted through this exchange, which has direct links to Albania, Austria, Bulgaria, Canada, Croatia, Great Britain, Germany, Greece, Italy, Russia, Slovenia, Switzerland, Turkey, Ukraine, the United States and SR Yugoslavia. In the meantime, a new electronic data-transfer network, MAKPAK (Macedonian Public Network for Data Transfer by Commuting of Packets), has started operation with the capacity for 380 connection points, linked with centers in Germany and Yugoslavia and through them to the global telecommunications network.
The installation of modern public telephone stations utilizing electronic cards is in the works, with 1,000 public phones to be installed. By the end of 1995 there were 402,000 telephone lines, with an increases to 643,000 projected by the year 2000.
Fishing. Fishing in the Republic of Macedonia is among the oldest of occupations, particularly among people living beside Ohrid, Prespa and Doyran Lakes. It is interesting to note that fishing in Doyran Lake, nearly eight times smaller than the Ohrid Lake, provides a catch twice the size caught in the Ohrid Lake-a clear indication of the extensive possibilities for Macedonian fishing industries. Unfortunately, during the last few years Lake Doyran has been threatened by ecological disaster-the water level is rapidly falling, with potentially disastrous results on the fishing industry of Doyran and the ecology of the lake.
There are several methods of fishing characteristic of Macedonia, but the most colorful has to be the fishermen of Doyran Lake who enlist the aid of the local cormorant population. "Peshtani train", named after the village of Peshtani near Ohrid Lake, consists of a special method of combining the drawing of nets by the coast and nets thrown deep in the lake. Eel-fishing near Struga in Ohrid Lake is undertaken with dalyans, an ancient method of partitioning the Crn Drim river.
In 1992, the total quantity of fish caught in Macedonia was 1,200 tons, including 513 tons of lake trout and 339 tons of California trout from fish ponds. In addition, 191 tons of carp were caught in the lakes, particularly at Doyran lake, and 153 tons in fish ponds. The remaining 500 tons were assorted species.
Tourism. Tourism in the Republic of Macedonia has developed as an economic sector only recently, but for the Macedonians this is only a ancient tradition now regained. Conditions for the rapid development of tourism in Macedonia are favorable; Macedonia is located at the crossroads between Central Europe and the Balkans, and the routes to Istanbul and Athens pass through Macedonia. Macedonia is rich in natural beauties of its own, providing opportunities for rest and relaxation in quiet splendor. The Macedonian hotel and restaurant industries shows considerable recent growth and the number of tables and beds is on the rise. In comparison with 1980, when 52,399 beds were available in Macedonian hotels, 81,328 beds were available by 1993.
In 1989, 1,032,072 tourists visited Macedonia-348,450 to Skopje, 33,192 to the five health resorts in Macedonia, and 401,594 to the lakeside resorts at Ohrid and Prespa. The Wars of Yugoslav Succession have hurt the Macedonian tourist industry despite peace within Macedonia itself, and in 1993 there were only 647,728 tourists in Macedonia, 439,537 of whom were locals. The remaining 208,191 tourists included 86,899 from Serbia, 59,964 from Bosnia-Hercegovina, 41,320 from Bulgaria, 10,373 from Germany, 8,540 from Albania, 7,888 from Turkey, 7,175 from Slovenia, 5,649 from Greece, 3,518 from the United Kingdom, 1,771 from the United States, and smaller numbers from other countries-including 3 from Iceland! In 1989, 3,522,477 overnight rooms were rented in Macedonia, but in 1993 this figure had been reduced to 2,706,373.
Business As recorded by the Republic's Bureau of Statistics as of June 1995, 81,917 businesses were registered in Macedonia, 95.6 percent under private ownership. The majority, or 96.6 percent of shareholder's capital in these enterprises is of local origin; only 2.4 percent were founded by mixed capital, and less than one percent are run solely by foreign capital. Most enterprises are founded for trade (62.5 percent), with 9.4 percent in industry and 6.8 percent in financial and business services. Of the total 81,917 enterprises in the Republic of Macedonia, only 82 are public enterprises and 558 social, while 48,708 are private enterprises and 594 shareholder's companies.
It is worth note that has been a noticeable decrease of foreign investment in the Republic of Macedonia in recent years; in 1990, foreign investments amounted to 15,140,000 US$, but three years later in 1993 they were almost halved to $811,700.
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