North Macedonia profile

Demography and Health

North Macedonia is a small country with a population of about 1.79 million people in 2024, ranking around 151 in size among nations. The demographic picture is heavily influenced by a negative natural trend and outward migration: births registered at 9.2 per 1,000 people in 2023 contrast with a death rate of 11.0 per 1,000, signaling a natural decrease rather than growth. The situation is compounded by a net outward migration of 5,728 people in 2024, which widens the aging challenge and could constrain the future labor supply and domestic demand. Life expectancy at birth stands at 75.3 years in 2023, while under-5 mortality is a relatively favorable 3.3 per 1,000 live births, pointing to solid child health outcomes despite broader demographic headwinds. The birth rate’s subdued level, together with an aging population trajectory, suggests policy attention to pension sustainability, health care demand, and labor market participation for older workers or returning emigrants. In terms of connectivity and human development, Internet diffusion is strong, with 87.2% of the population using the Internet in 2023, which supports e-government, telemedicine, and information dissemination. Nutrition indicators are generally robust, with a prevalence of undernourishment at 2.5% in 2022, reflecting a relatively secure nutritional environment for the vast majority of residents. Health financing shows a mid-range level of investment: current health expenditure accounts for 7.62% of GDP in 2022, and domestic general government health expenditure per capita in Purchasing Power Parity terms was about 1,033 international dollars in 2022, indicating a financing framework that can sustain essential services but may require consolidation to manage longer-term aging and chronic disease burdens. Taken together, the demography and health data reveal a nation with decent health outcomes and digital reach but facing demographic pressures that could shape public finance, pension adequacy, and health system demand in the coming decade.

Economy

Economically, North Macedonia sits at a modest income level in current US dollar terms, with GDP per capita of 9,310 in 2024 and a higher PPP-adjusted figure of 26,587 international dollars, suggesting that the cost of living is relatively low while living standards, when measured by purchasing power, appear more favorable. The economy is highly open to external trade, with exports of goods and services comprising 62.7% of GDP in 2024 and imports accounting for 75.8% of GDP, underscoring integration into global value chains as both a source of growth and a potential vulnerability to external shocks. The country runs a moderate current account deficit of 2.24% of GDP in 2024, which is financed by capital inflows and reflects the balance between external demand and domestic investment. Foreign direct investment net inflows are robust at 7.03% of GDP in 2024, highlighting a degree of investor confidence and the potential for technology transfer, employment gains, and productivity improvements. Inflation remains contained at 3.49% in 2024, supporting macroeconomic stability and purchasing power. The labor market shows a mixed picture: unemployment is high at 13.2% in 2023, indicating structural frictions, skill mismatches, or cyclic factors that need policy attention. The unemployment figure is noted with a rank suggesting relative strength within a certain comparator group, but the absolute level points to a need for effective job creation and skills development strategies. On the investment and innovation side, research and development expenditure stands at 0.395% of GDP in 2023, while residents filed 42 patent applications in 2021, signaling a nascent but growing innovative economy. High-technology exports total about 431.8 million USD in 2024, reflecting a developing tech sector that could be leveraged through targeted policy support, infrastructure, and R&D incentives. Public spending on health and education supports a basic welfare base, while military outlays remain modest at 266.6 million USD in 2023, indicating a development-oriented rather than heavy security posture. Taken together, the macroeconomic fabric shows a country with steady macro fundamentals, active openness to trade and investment, and opportunities to raise productivity through innovation, targeted human capital development, and export diversification.

Trade and Investment

North Macedonia demonstrates a highly open trade regime and a growing investment profile. Exports of goods and services stand at 62.7% of GDP (2024), while imports are even more dominant at 75.8% of GDP, signaling a high degree of trade integration and dependence on external inputs. The current account balance is negative at -2.24% of GDP in 2024, reflecting a modest deficit that is typical for economies with substantial import needs and investment activity, yet not alarming in magnitude. Foreign direct investment net inflows reach 7.03% of GDP in 2024, implying a favorable climate for investors and potential spillovers into technology, production capacity, and job creation. The country’s logistics and transport capacity are supported by a Logistics Performance Index of 3.0 on a 1–5 scale (2022) and a rank of 16 in quality of trade-related infrastructure, indicating a solid but improvable logistics base that facilitates trade and investor activity. The external orientation is complemented by a tech and R&D dimension: renewable energy consumption makes up 19.5% of total final energy consumption (2021), while high-technology exports total roughly 431.8 million USD (2024), suggesting movement toward value-added manufacturing and knowledge-intensive industries. R&D intensity is moderate at 0.395% of GDP (2023) and patent activity—42 resident filings in 2021—points to an emerging innovation system with room to scale. The strong internet penetration, at 87.2% (2023), supports digital services, e-commerce, and potential export-oriented tech services. However, the economy’s openness also means sensitivity to global demand and supply chain perturbations, emphasizing the need to deepen domestic capabilities, diversify export products, and strengthen supply chains to reduce vulnerability to external shocks. Overall, the trade and investment profile shows a country embedded in regional integration with opportunities to boost competitiveness through reforms that enhance productivity, digitalization, and export sophistication.

Governance and Institutions

The governance landscape in North Macedonia is mixed across key indicators. Political stability and absence of violence/terrorism register at 0.17 in 2023, suggesting a degree of political steadiness, but not an exceptionally high stability level. Regulatory quality is a more favorable signal at 0.427, indicating credible policy design and regulatory practices relative to peers in the region. However, rule of law is negative at -0.168, and control of corruption is also negative at -0.349, signaling concerns about legal predictability and corruption that can impede investment and business operations. Government effectiveness rests near the baseline at -0.0513. Together, these indicators paint a governance environment with some policy credibility and stability but with meaningful challenges in legal enforcement and corruption — areas that can influence private sector confidence, contract enforcement, and the efficiency of public services. The logistics performance and digital connectivity suggest that the country has built some administrative and infrastructural capacities to support trade and innovation, yet reforms focused on strengthening the rule of law, judicial efficiency, and anti-corruption measures could reinforce investor confidence and overall governance performance over time.

Infrastructure and Technology

North Macedonia benefits from a solid infrastructure and technology base that supports growth and integration into regional and global markets. The country ranks 16th in logistics-related infrastructure quality, with a Logistics Performance Index of 3.0 on a 1–5 scale in 2022, indicating a mid-to-high level of efficiency in trade and transport networks. Digital connectivity is particularly strong, as 87.2% of the population used the Internet in 2023, a foundation for e-commerce, digital public services, and the diffusion of technology across sectors. The economic footprint of technology is visible in high-technology exports worth about 431.8 million USD in 2024, complemented by R&D expenditure at 0.395% of GDP in 2023 and 42 resident patent applications in 2021, evidencing a developing but expanding knowledge economy and intellectual property activity. Renewable energy accounted for 19.5% of total final energy consumption in 2021, illustrating a shift toward cleaner energy sources, while per-capita greenhouse gas emissions excluding LULUCF stand at 6.22 t CO2e in 2023, a moderate level consistent with a transitioning economy. This combination shows a country building physical and digital infrastructure to support modern growth, while balancing environmental considerations and resource constraints (e.g., water stress at 38% in 2021). The health and public service dimensions are supported by health expenditure levels (7.62% of GDP in 2022) and per-capita health spending (PPP) of 1,033 international dollars (2022), indicating a public investment framework designed to sustain service delivery amid ongoing modernization.

Environment and Sustainability

Environmental indicators reveal both progress and pressures in North Macedonia. Total greenhouse gas emissions per capita (excluding LULUCF) are 6.22 t CO2e in 2023, reflecting a moderate carbon intensity consistent with a developing economy and domestic energy use patterns. Water resource management shows stress: freshwater withdrawal as a share of available freshwater resources stood at 38.0% in 2021, signaling meaningful water pressure that can influence agriculture, industry, and domestic supply. Renewable energy already accounts for 19.5% of total final energy consumption (2021), implying a foundation to expand clean energy and reduce vulnerability to imported fuels. The prevalence of undernourishment is relatively low at 2.5% (2022), indicating adequate food availability for the vast majority of the population, though climate and agricultural shocks remain a concern for vulnerable households. In terms of resilience and policy, the combination of moderate emissions, growing flexible energy sources, and manageable food insecurity provides a platform to pursue further sustainability gains through energy efficiency, expanded renewables, and water management strategies while continuing to address demographic and economic shifts that influence environmental demand and policy priorities.