Promoting Inter-municipal Cooperation -Challenges and Opportunities the case of Macedonia

1. Promoting Inter-municipal Cooperation -Challenges and Opportunities the case of Macedonia Presenter: Vesna Dzuteska Bisheva 8 December 2005

2. Macedonia and the EUEconomic development indicators on the level of NUTS II Nominal convergence Inflation rate 2% Budget deficit 0.9% Public debt 6% Exchange rate – stable since 1996 GDP per capita 2000$ (8% of the EU average) Average growth rate 0.9% 1992-2003 (2% EU) Gross investment rate 18.3% (25% EU) Rate of the current account deficit 8.3% GDP Participation of high-technology goods in the export 0.8% (20% EU) Participation of agriculture 9.6% (5% EU) Unemployment rate 32% (8% EU) Real convergence

3. General indicators of regional development-NUTS III • Source: State Statistical Office, UNDP Project for Mapping of Socio-Economic Disparities among municipalities/statistical regions

4. GDP and investment distribution (1990-2000) • Source: Information by the Payment Operations Office 2001 Investment in fixed assets of R. Macedonia 2001, Statistical Review 431, Skopje, 2003

5. Implications on the development • Centralization of development or implementation of the "centre-periphery” model • Development lag in the mid-sized towns, as potential carriers of the polycentric model of development • Growing geographic inequalities, degradation and devastation of rural areas (HDI for urban areas 0.796, HDI for rural areas 0,765)

6. Major impediments for optimal geographic distribution of the development • Following independence of the country in 1991, the trend for centralization of finances and competencies took root; • With the Law for Local Government of 1995, LGUs were left with no power; • With the Law for Territorial Organization of 1996, LGUs were fragmented and became not viable

7. Government Response to local and regional development • Decentralization reform of 2002 was seen as an opportunity for improvement of the governance and more efficient service delivery; • New Law on Local Governments (2002), Law for Financing of LGUs (2004), Law on Territorial Organization (2004) and additional 46 sectoral laws were adopted; • Inter-municipal cooperation and regional development are indicated as priority areas in the Decentralization Action Plan, aiming to ensure equal quality of services for all citizens at the local level; • Inter-municipal cooperation mentioned only in one article of the law on LGs “in the performance of their competences, the municipalities may cooperate among themselves…they may join funds and establish shared public agencies…or shared administrative bodies, in accordance with law”. • The legal framework for regional development under preparation;

8. UNDP Response to local and regional development • Methodology for preparation of Regional Development Plans; • Methods for monitoring and evaluation of the impact from implementing Regional Development Plans; • Technical Assistance for setting procedures and conditions for establishment Regional Development Agencies (TORs); • Providing advice and development of the legal framework on possible institutional arrangements for inter-municipal cooperation.

9. UNDP Response to local and regional development • Promotion of bottom-up development • Applied to preparation of local development strategies, development strategies for micro-regions and regional strategies • Creating opportunities for dialogue and conflict resolution • Inter-municipal cooperation can facilitate better understanding and develop cooperation culture between municipalities of different ethnic composition and in that way can reduce ethnic sensitivities. • Decentralization as a factor for accelerating development and local processes • The increased municipal competencies used as an opportunity for supporting innovative partnerships among private/public and civil society sector • Cooperation between the private, public sector and civil society • In all local and regional level initiatives, dialogue and partnerships are must;

10. UNDP Response to local and regional development • Horizontal cooperation between municipalities (formal and informal) • Opportunities are created for learning and sharing experiences, while also facilitating joint projects; • Competitive, comparative advantages and complementarities • Capacity building and raising awareness among stakeholders to identify and take advantage of such analysis in their development planning processes • Social and economic identity of the region • Development of methodology and indicators for regional development plans, piloted in two regions;

11. Forms and network for partnerships • Mayor’s offices and municipal councils; • Local developmental agencies; • Local economic and business information centres; • Local/Regional Advisory Boards or Local/Regional Leadership Groups; • Task forces and working groups around various issues;

12. Participation - key factor of bottom-up development • Only 26% of citizens think municipal government is aware of their problems; • only 35% think their municipality considers citizens’ opinions when preparing a municipal strategy, which demonstrates a large gap between municipal government and the citizens and underutilization of HR potentials; • Approximately 1/3 of respondents are aware of public meetings or hearings that have been held in their municipality or neighborhood, know someone who has attended a City Council meeting, or have heard of Citizen Information Centers and 1/5 has ever participated in public hearing; • 78% think citizens can effect change, more than 80% think others are interested and willing to become involved, and 60% are willing to become involved themselves; • Huge gap between willingness to participate and actual participation.

13. “Invisible” factors of bottom-up development • Good management of the local self-government that is able to provide support to positive initiatives within the community; • Commitment of local management and a vision for economic revitalization of the community; • Capacities to advocate before the highest levels of authority; • Inclusion of a large number of participants in debates around local/regional developmental scenarios; • Good knowledge of the local and regional markets; • Awareness that development is a never-ending process; • Encouraging of entrepreneurship, local technologies, consultation, information and education infrastructure

14. Thank you and no tough questions please!!!