Government Measures for Municipal Debt Relief: The Impact and Effects on Citizens in Polog Region the Republic of North Macedonia

Shenasi Memishi ()
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Shenasi Memishi: University American College, Faculty Economics

Chapter Chapter 19 in Economic Resilience and Sustainability - Vol. 2, 2026, pp 301-316 from Springer

Abstract: Abstract Although North Macedonia has been decentralized since 2001, managing debt is still a major obstacle. The reasons of municipal debt in the Polog region are examined in this study, along with the effectiveness of the 2018 government debt reduction program. The results indicate that the main causes of debt are inadequate financial planning, low revenue collection, overemployment, expensive procurement, and postponed projects. Although the 2018 intervention—direct debt payment—provided temporary respite, it did not tackle systemic problems and, by incentivizing poor management, promoted moral hazard. There was little advantage to the citizens. As demonstrated by the fact that municipalities in Polog are still accruing debt after the intervention, the study comes to the conclusion that such interventions are unsuccessful in guaranteeing financial stability in the absence of long-term fiscal reforms.

Keywords: Municipalities; Debts; Government; Polog region (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-032-04214-9_19

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DOI: 10.1007/978-3-032-04214-9_19

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