Paper/Speech Details of Conference Program for the 18th NISPAcee Annual Conference Program Overview V. Working Group on Public Sector Finance and Accounting Author(s) Meri Boskoska University "St. Kliment Ohridski" Bitola Republic of North Macedonia Prisaganec Milco, Dimeski Branko, Milco Prisajganec, BSc in electrical engineeringBranko Dimeski, PhD student in public administration Title The necessity of coordination between monetary and fiscal policy in Republic of Macedonia in time of crisis File Paper files are available only for conference participants, please login first. Presenter Abstract ABSTRACT During the last decade of the XX century and the beginning of the XXI century, the world economic scene was witnessing a series of financial crisis that produced serious consequences, not just in the countries where they initially appeared, but also, their negative influence caused serious problems in many other countries, so they had a strong negative impact on the overall future development of the world and international economy. The principal research objectives of the paper are: • to search for the causes that produced the financial crisis in the Republic of Macedonia; • the overall consequences of the negative impact of the crisis on the industrial sectors in the country; • to reveal and to analyze the industrial sectors of the economy that were most vulnerable under the negative wave of the global financial crisis; and • so-called “domino” effects of the financial crisis in the economy in the Republic of Macedonia. The scope of the research is covering explanation of the abovementioned objectives and will depend on the knowledge that already exists in the literature and is provided by different authors that made past research on the impact of the global financial crisis on the Macedonian national economy. For the purpose of writing the paper, we employed different methodology that will be based on: • content analysis of various governmental documents and research papers that are dealing the issue of global financial crisis; • comparative analysis; • using administrative numerical data for the purpose of possible calculation of the overall expenses that produced negative impacts on the national economy; and • during the research, the deduction aspect will be applied. The research summarized the following results and findings: • the financial crisis caused highly negative effects on the functioning of the industrial sectors that are export oriented (precisely textile and metal industry); • the lower demand for its production caused decreased scope of production; • faced with all these problems, the organizations started downsizing the number of their employees that caused increased number of the unemployed in the country; • as a consequence, the overall investments decreased, the budget deficit increased, public debt was permanently increased; and • all abovementioned negative effects caused decreased or even negative rate of the overall economic development in the country. From the research findings and results, the following principal conclusions can be derived: • facing the negative economic wave of the world financial crisis, the government of the Republic of Macedonia must act in decreasing the governmental expenditures; • in doing so, the government must apply certain measures in order for the domestic economic development to be increased; and • undertaking certain measures means applying a combination of both, fiscal measures of the government and monetary measures of the National Bank, because they are key instruments for sustaining the financial stability and constant increase of the economic development of the country.
