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- Lack of transparency and deliberate circumvention of legal public procurement procedures are the main features of several major investment deals in road and energy infrastructure concluded by different Macedonian governments over the past decades under the guise of strategic partnerships.
- This is one of the main findings of the new study “Economic Channels of Foreign Influence in North Macedonia”, which warns that the phenomenon of foreign information manipulation and interference (FIMI) is not limited to disinformation campaigns and cyber-attacks, but that “economic instruments of power are one of the central pillars of influence strategies”.
- The study analyses four key cases: the privatisation of OKTA with Greek capital, the gas projects with Russia, the motorways financed by China, and the road infrastructure projects carried out by Bechtel and Enka.
One of the central cases analysed in the study is the 1999 privatisation of the OKTA refinery, which was sold to the Greek company Hellenic Petroleum. The deal, reached at a time of political and economic instability, was later assessed as an example of creating asymmetric dependency.
According to IKS, the agreement included “a monopoly position, tax breaks and guaranteed fuel purchases”, which restricted competition and burdened the state. The Constitutional Court later ruled that such provisions violated the principle of market equality.
The consequences were not only legal but also financial. After arbitration proceedings, the state paid more than 60 million euros in compensation. But, as the study stresses, the political effect is even more important: “A large part of energy sovereignty was effectively transferred to a company from a neighbouring country.” In the context of the then name dispute with Greece, this further limited the state’s negotiating position.
The IKS study points out that the energy sector remains a key channel of influence, partly because of dependence on Russian gas. Gazprom is the country’s main supplier, which makes North Macedonia vulnerable to external pressure. In addition, the case of the construction of the gas pipeline network, financed by settling the Soviet debt, raised serious suspicions. As the study states, investigations showed that “the real cost of the project was significantly lower than the contracted one”, pointing to possible abuses.
Although the case was never resolved in court, it remains an example of how economic agreements can create room for influence through non-transparent practices.
Tearing down public procurement legislation
The study also analyses the role of China, which financed major road infrastructure projects in the country that were awarded to the Chinese company Sinohydro. The Chinese loan set a kind of precedent in Macedonian legislation because of the record number of annexes to the original contract.
“In addition, the secrecy of the negotiations on granting the loan is problematic, raising suspicion of deliberate delays in construction to the detriment of the state budget and Macedonian citizens,” the study states.
The lack of transparent tender procedures and frequent contract annexes led to significant cost increases and delays. The study particularly highlights the Kichevo–Ohrid motorway, which has become a symbol of institutional weakness and which today, 13 years after work began, has still not been completed. The study warns that such projects create “long-term financial obligations that limit fiscal and political autonomy”.
A particularly important analytical contribution of the study is that it goes beyond the dichotomy between “good” and “bad” foreign capital. It points out that the way the contracts for building the Corridor 8 and 10d motorways were awarded to the American-Turkish consortium Bechtel and Enka shows that even investments linked to Western partners can produce unwanted effects if they are carried out in conditions of non-transparency, legal exemptions and limited democratic oversight.
“Therefore, the problem lies not exclusively in the geopolitical origin of the capital, but in the governance model and the institutional framework into which it is embedded,” IKS states.
Key consequences
The empirical findings of the study indicate that these mechanisms produce three key consequences. First, they create structural dependency – in the energy sector through monopoly or quasi-monopoly positions, and in infrastructure through long-term financial obligations that limit the fiscal and political autonomy of the state. Second, they encourage institutional erosion, because they are carried out by bypassing public procurement, applying laws selectively and weakening parliamentary and judicial oversight. Third, they influence political processes indirectly, by shaping the scope of public policy and creating asymmetric power relations between the recipient state and foreign actors.
What needs to be done?
The main message of the study is that North Macedonia must strengthen the domestic governance framework through which such projects are negotiated, approved and implemented.
This means restoring the primacy of transparent and competitive public procurement, strengthening parliamentary, judicial and audit oversight of strategic economic projects, and including assessments of the risk of foreign influence when considering major investments, especially in energy and infrastructure policy.
This content was produced by the Institute of Communication Studies.
Photos: Nake Batev
This article was translated from Macedonian using artificial intelligence (AI). The original Macedonian version is available here.
