The opening of the „Makdia“ factory in Bunardzik in 2015
We thought the Macedonian public should know if the promised was delivered, and to what extent, and what happened behind the closed doors of the foreign investments once the ribbon had been cut and the cameras had been pulled away after the opening ceremony. We also thought that everything should be gathered in one place so as to monitor the changes in the companies and develop an insights about how much have these foreign investments helped the Macedonian economy longterm and how many new jobs they opened.
Although for the preparing the database, BIRN required the cooperation from the relevant institutions (ministers without portfolios, Technological Industrial Development Zones, the Agency for Foreign Investments, municipalities) unfortunately, BIRN hit a wall of silence on their part when it tried to research how many investments had been made in the country, how many people had been employed, how the investments worked and what had happened to the announced, but no yet realised, investments.
BIRN had been making inquiries for months with all those relevant or responsible for foreign investments. However, contrary to their statements about being transparent, BIRN did not usually get any responses.
Precisely because of the silence of institutions, the key criteria in developing the „Foreign Investments Uncovered“ database, were the questions: Which investments were announced by representatives from the Government? and Which institutions are responsible for the foreign investments made between 2006 and 2016 that were supposed to open new jobs?
For that purpose, the starting point for this research was the website of Government and its corresponding archive, where all announced investments, ribbon-cutting at new factory openings, announced sums to be invested and new jobs were published. We searched through Internet archives, political parties’ accountability reports, the ruling party’s programme, websites of municipalities.
In this way, BIRN discovered data showing that a large number of investments were announced more than once, but in different years, as brand new investments. For instance, the Austrian Texport Production was announced in 2011 by the Prime Minister at the time, Nikola Gruevski, and then, three years later, in 2014, it was also announced by Gjorgje Ivanov, a presidential at the time.
Hence, the impression that new investments were being announced on daily basis in Macedonia, even though, it actually happened that the same investment was announced several times.
How did we make the Database?
Having in the mind the complete lack of official information, one of the most difficult tasks BIRN had when making the database was to determine whether the stated sum was indeed invested.
„An investment of 5 million Euros that will open 200 new jobs“ were the words most commonly used at political party rallies, in programmes, accountability reports and at press conferences. Only the sum changed; sometimes it was 10 million, sometimes 20 million. The most difficult thing was to confirm whether, and to what extent, announced sum was actually invested in the country.
Therefore, BIRN decided to take into account the non-current assets that companies declared in their balance sheets submitted to the Public Revenues Office and which were available in the brief statements received from the Central Register. These offer, in fact, data on the value of the property, the machines, the land, plants, equipment, concessions, patents, licences. This type of calculation, according to the experts we consulted, is the most accurate approximate data on the value of an investment.
Having in mind that the most recent information from the Public Revenues Office and the Central Register are for 2015, while the newer ones will be available in March 2017, BIRN will update the database with the latest information related to the companies’ assets.
All the information on the assets of the companies, received from the Central Register, are included in the database and the document can be downloaded directly. This document also contains the average number of employees in the companies, and in this way, we were able to make a comparison between the number of announced employments and realised employments for the year in question.
The companies for which BIRN could not obtain the official name, under which the company had been registered in Macedonia, due to institutional silence and the lack of data thereof, make an exception and the data for these companies was not included in the total calculations.
Thus, the only data, based on which the database was created, is the data from the Central Register, more precisely, the financial reports of the companies created by foreign investors in the country, included in the database.
Based on the fact whether the foreign investor had opened the company or not and whether it had started to work, BIRN categorised investments based on three criteria – „realised“ (if the factory is open, regardless of how much of the promised was actually fulfilled), „in progress“ (if the investment is still in its early stage, announced recently or the factory/plant has not been opened yet) and „unrealised“ (if the investment was promised but never realised).
BIRN will continue to follow these companies in order to see whether the number of employees is increasing or decreasing and how much is invested in the company in the country every year.
The silence of institutions
For all of the questions noted above, BIRN had been trying for more than half a year to get in touch with government representatives who had announced the investments.
The one BIRN most frequently sought out, Viktor Mizo, the Director of the Technological Industrial Development Zones (TIDZ), did not respond to our calls nor to our invitations for a meeting and an interview. In the beginning of November this year, we contacted the TIDZ with an official letter in which we explained what we do and we asked for a meeting with Mizo; we also asked for permission to visit and photograph the TIDZ Bunardzik.
Several days later, we received a call from a representative from the TIDZ who requested a detailed explanation about the database in question and inquired if it had any relation to the pre-election period, because we are only taking into account the investments from 2006 until present day.
We explained that the database contains only specific facts on foreign investments and that prior to 2006 there was no information on foreign investments. We emphasised that the database had nothing to do with the parliamentary elections and that it would be published after the elections. The representative from the TIDZ said that they would contact us and that Mizo would be available around November 20, however we have not heard from the TIDZ since.
The only unofficial reply we received for some of the investments was from Deputy Prime Minister, Vladimir Peshevski, and from the cabinet of Visar Fida, the Director of the Agency for Foreign Investments we received a feedback via e-mail on the current state of some of the investments announced by him.
Enclosed are all our attempts to get in touch with the ministries without portfolio, in charge of attracting foreign investments, Vele Samak and Jerry Naumoff. BIRN did not receive any reply to these messages.
Incidentally, taking photographs is not allowed in any of the industrial zones, nor is a visit without prior permission, and having in mind that Mizo, the Director did not reply to our requests, BIRN used official photographs from the opening of the factories or photographs from the Macedonian Information Agency (MIA), while for the foreign investments outside the TIDZs, we hired correspondents from outside of Skopje.
We did not use the Law on free access to public information for the database because the decisions for state assistance that the Government gives to foreign investors are not public. BIRN had already tried to obtain these documents, but, all of the sums, including the number of planned employments, have been marked with XXX in the documents, which makes the whole process utterly non-transparent.
An example of a document for provided state assistance for foreign investors
Transparency of foreign investment exists only when the investment is announced, when the ribbon is cut and when there is big talk regarding the value of the investment and the number of new jobs, but, after that, when reporters request specific data on state assistance, realised or unrealised investments, institutions turn a deaf ear to their requests.