EUROPEAN DEVELOPMENT FUNDS IN THE ECONOMY OF NORTH MACEDONIA (2021–2027)

Abstract

This paper examines the role and impact of European Union funding instruments—IPA III, Horizon Europe, and Erasmus+—on the economic development of North Macedonia. As a small economy with limited domestic investment and structural challenges, North Macedonia relies heavily on external assistance to advance its competitiveness, innovation capacity, infrastructure, and human capital. The study outlines how EU funds support national programs in areas such as education, research and development, transport, energy, and governance reform. Through specific funding mechanisms, the EU facilitates economic modernization, academic-business collaboration, youth mobility, and administrative reform. Despite these benefits, the paper highlights several obstacles, including weak administrative capacity, insufficient co-financing, political instability, and the need for stronger rule of law reforms. The analysis concludes that while EU support is critical to North Macedonia’s development, its effective utilization depends on the country’s ability to improve institutional readiness and long-term strategic planning.