INTERVIEW VIEW Blacksands Pacific Group, Inc. Interview INTEGRITY – one of the fastest growing and

INTER Macedonia’s COMMITMENT most dynamic energy companies in the United States – will soon be making a DYNAMISM series of announcements about Advantages far-reaching global partnerships that will produce and deliver energy An Interview with efficiently around the world. H.E. Nikola Gruevski, Prime Minister of Macedonia improvements in Additionally, we created free economic the quota system zones with a tax holiday in the fi rst 10 years for and the admin- companies operating there. This is an important Oil and Gas Exploration & Production istration, and in advantage. the fight against We’re also a small country with two million Crude Oil and Petroleum Products Trading corruption and people within 25,000 square kilometers, but we Gas and Power H.E. Nikola Gruevski criminals. have free trade agreements with all countries in The fifth of Europe except Russia. This means everything EDITORS’ NOTE Nikola Gruevski has been the our top priorities is education; not only that is produced in Macedonia can be exported Prime Minister of Macedonia since August 2006, fi nding ways to improve its quality but also to those countries without paying custom du- and has led the ruling VMRO-DPMNE party making education easier and more ac- ties. Products produced in Macedonia get the since May 2003. He was Minister of Finance in cessible for all citizens across the country. same treatment in any country in continental the VMRO-DPMNE government until September Connected to this is also innovation, and Europe except Russia. 2002. In 1996, he also acquired qualifi cations bringing more of an entrepreneurial spirit to With this step, we overcame the handicap for the international capital market from a the citizens and, of course, developing many of small markets, and it’s helping us, in combi- London Securities Institute. In December of instruments to help do this. nation with low costs and with well-educated 2006, he obtained a master’s degree from the When foreign investors talk about mar- people, to be a gateway into Europe. Many Faculty of Economics at Ss. Cyril and Methodius kets that provide opportunity, we don’t al- companies overseas are buying locations, start- University of Skopje. Gruevski founded the ways hear about Macedonia but you have ing facilities, and cover all of Europe with the Brokerage Association of Macedonia in built a platform that is open for foreign in- products they produce here. 1998 and made the first transaction on the vestment. Is that message and the oppor- It’s also important that we have improved Macedonian Stock Exchange. In 2014, he won tunities and stability Macedonia can offer the business climate over the past nine years. In the Order St. Nicholas – Highest Award of Štip well understood? 2006, when we were elected to the government, and in 2015, he won the Order Baptist (Preteca) We’re a country that has political stabil- the World Bank Doing Business report ranked from Saint Jovan Bigorski Monastery. He has ity and macroeconomic stability. Our growth us at the 96th position; today, we are in the also been recognized with the Vienna Economic has been about 2 percent per year over the 12th position in the world and 6th in Europe. Forum award for contribution to national and past 15 to 20 years. We have maintained state Only Great Britain and the Scandinavian coun- regional economic development. debt at 36 percent of GDP and public debt tries are ahead of us in Europe. That is serious at 43.8 percent. Before 2006, state debt was improvement. You have been very forthcoming on a num- at 40 percent. We have a stable local cur- In the meantime, we have also been one ber of goals for your administration. What rency that is fixed to the Euro; and all other the top 10 reformers in the world four times are those priorities and how have they items connected to macroeconomic health and were number three two times, according to progressed? are stable. the World Bank. The government has fi ve strategic priorities Over the past two years, we reached the This came as a result of many steps we took. and they are all, more or less, equally important. second biggest GDP growth in Europe – 3.8 We passed one project involving bureaucratic The fi rst is to realize our plan to join NATO and percent – this year, and the year before as well. reform, which made thousands of processes in the European Union, and to fi nd a solution on I hope this year, we will have some very good the country faster or cheaper. We worked to- how to do this without Greece revoking our results in cooperation with all of the European gether with the Chambers of Commerce and membership in both organizations. countries. more than 350 companies from different sectors Our second very important strategy is con- One of the most attractive advantages that and sizes. We detected all weaknesses in the bu- nected to the economy. We have opened it for Macedonia offers is one of the lowest costs reaucracy that they were feeling and eliminated new jobs and outside investors, and created for doing business in Europe. When I talk about most of them, and we made those that we could a good business climate and a strong general costs, I mean all costs for doing business start- not eliminate faster and cheaper to adhere to. www.blacksandspacific.com economy with new jobs. ing with taxes and custom duties and going to We also changed many things that were The third one is connected to keeping logistics costs, energy costs, labor costs, and so disadvantages for our country at the time and good internal relations within the country. on. made them into advantages. For example, Macedonia is a multiethnic country and this is We have the lowest taxes in Europe. in 2001 and 2002, our Ministry of Finance es- very important. This includes the implementa- Personal income tax in Macedonia is 10 percent tablished for the fi rst time a central register. tion of the Ohrid Agreement signed in 2001 and profi t tax is 10 percent. If the profi t tax is Today, according to The World Bank, the and assisting in the normalization of relations reinvested, it is 0 percent. We decreased customs Macedonia Central Register is number one in BLACKSANDS PACIFIC ENERGY CORPORATION BLACKSANDS PACIFIC INTERNATIONAL LIMITED and creating a better atmosphere between the and duties, we decreased the contributions to the Europe, and number 16 in the world. North America Africa and Beyond different ethnic communities. health and pension funds, and we have taken Another reform relates to the time it takes The next one of our priorities is con- many other steps connected with decreased to create a company. In the past, it took sev- nected with the rule of law and different kinds of taxes, such as implementing a fl at-rate tax. eral months to open a company here – today, it VOLUME 39, NUMBER 1 POSTED WITH PERMISSION. COPYRIGHT © 2016 LEADERS MAGAZINE, INC. LEADERS 13

Untitled-1 2 8/8/2014 11:35:51 AM takes four hours for those from anywhere in We changed the curriculum in basic el- were in a position to do something about this the world. We also have free Internet and low ementary and secondary school to where it now and change the strategy. In the beginning, we start-up costs. includes IT, ethics, innovation, business, entre- didn’t pay much attention when 500 people We offer the electronic payment of preneurship, and other subjects that we believe passed through our country in one day, but taxes and electronic communications with are important for young people in this phase of when it rose to 2,000 or more, we determined the custom office, and have 100 percent development of our country. we must be better organized. We included coverage throughout the country for work- We also created a rule in which secondary the army and the police, and people from our ing electronically with clients. Previously, school is mandatory and free of charge, so all health system to provide health services. We those were all disadvantages and they are children are going to secondary school. Ninety- created a system that is functioning well now now advantages. nine percent of children are fi nishing secondary where people who come to our borders are Free economic zones are also interesting school, which is very important for the mea- given food and water and medical care. One to investors. For example, outside of the tax sures we created. A very high percentage of to two hours are spent on registrations, which holiday where they don’t have to pay per- people are starting university because we are provides data we electronically share with other sonal income tax or profi t tax in the fi rst 10 subsidizing higher education. We decreased the European countries. After that, they are trans- years, there is also no custom duty or VAT for price of university to $250 per year. ferring to trains because many want to go to raw materials imported by those companies We also translated more than 1,000 books Germany, Sweden, or elsewhere. for the purpose of producing goods that will that are used in the top 10 universities in the For now we are managing. The number be exported. world and gave them to different universities in now passing through has reached 6,000 ev- Plus, our latest development, is very low Macedonia from all sectors. We invested a lot ery day, sometimes more. We have 10,000 prices – almost free of charge – given on a leas- of money for buying new laboratories for the on some days. This year alone, more than ing base of up to 99 years. The government faculty that are also used for business, not just 600,000 refugees passed thru the country and is participating with up to $560,000 for con- for scientists. we provided humanitarian aid to all of them. struction of the facilities and also participates in We put 5 or 6 percent of GDP every year Are there moments when you can ap- training workers. We have good infrastructure into education. We also have a high percentage preciate the successes or is it always look- for companies to come and many have come of people under 30 – 41.2 percent of our citi- ing ahead at what further needs to be done? from the United States, the U.K., Germany, Italy, zens – and those things are helping us attract There are many moments. With the mea- and others. more investors. sures we have taken, the percentage of people We have worked hard to not only in- The biggest challenge in the economy is who are going into higher education has risen – crease quality of education but also quantity unemployment. When we entered the govern- almost 95 percent of those who fi nish secondary of people who are highly educated. English ment in 2006, the unemployment rate was 38 school are starting university. About one-third language is mandatory from elementary percent – the highest in Europe. Now, after still don’t fi nish secondary school, which is nor- school to high school-plus, as well as one ad- passing through a diffi cult period with the fi - mal, but 65 percent are fi nishing. This is a seri- ditional world language. nancial crises, we have decreased it to 26 per- ous advantage for our country to encourage cent, which is still high but is investors to come here. 12 percentage points lower than We have also created other programs for at its peak and, most impor- people who didn’t have a chance to study at tant, every quarter it contin- university in the past because they didn’t have ues to decrease. I believe these money or considered it important. We have cre- dynamics over the next two to ated programs for people in middle age – 35 or three years will continue to go older – where most of the lessons are presented even lower. The citizens are over weekends. Many are now fi nishing uni- recognizing this and supporting versity and taking their newly-gained knowl- the politics. edge and moving ahead in their careers. I have Do you find that these met many people who have thanked me for this are all tied together – educa- opportunity. Many have tripled their salaries. tion, entrepreneurial culture, Did you know early on that public ser- etc. – and that one leads to the vice and government was of interest to you? other? I started working at a private bank in the Everything is connected. capital. Two years later, I passed all exams For example, we are offering necessary to become a broker of the stock companies coming into the exchange when the stock exchange was, for country and planning to start a the fi rst time, opened in Macedonia. I did the facility and hire 300 to 500 work- first transaction on Macedonia’s stock ex- ers the opportunity to adopt the change in 1996. I didn’t have any idea at that curriculum in the last two years time that I would work within government, of university study according to but it came to this. their necessities to produce more As part of your success, you’ve sur- finished students who can im- rounded yourself with great talent. How mediately have the capabilities important has it been to bring those into needed. government with you? We have to offer good price, One of the advantages of this political party good quality of educated people, is that I’m trying always to bring in the best and a big pool of trained workers, people. When I formed the government in 2006, as this is an advantage for com- more than half of the ministers that my party panies coming here. As a result, promoted were not from our party. One third many companies have recently of the ministers of the government today are come to Macedonia. coming from those who have worked mainly Would you talk about the from the U.S. at companies like Microsoft, HP, refugee crisis? Siemens, and The World Bank. Working A very high number of ref- with people who share their good knowledge, ugees are now transiting through experiences and deliver at high capacity is eas- Prime Minister Gruevski and his wife, Borkica our country. At one time, we ier and gets good results.• 14 LEADERS POSTED WITH PERMISSION. COPYRIGHT © 2016 LEADERS MAGAZINE, INC. VOLUME 39, NUMBER 1