The Macedonian finance ministry is working on revisions to the 2017 budget that will cut out spending on luxury travel and expensive furniture planned by the previous government. 

The new government led by Social Democratic Union of Macedonia (SDSM) was voted in at the end of May, ending a decade of rule by the conservative VMRO-DPMNE party, which has been accused by the SDSM of wasting money on expensive prestige projects and hiking the country's debt burden.

The finance ministry is now speeding up its activities to adopt revisions to the 2017 budget, expected by the end of July, local media reported quoting the country’s new finance minister, Dragan Tevdovski. 

The aim is to cut spending on “comfort and luxury” planned by the previous government, Tevdovski said. This reportedly included expensive furniture for government ministries and luxury travel for top officials. 

Before it came to power, the SDSM repeatedly criticised VMRO-DPMNE for excessive spending on projects like the Skopje 2014 revamp of the capital city, whose cost was initially estimated at €80mn but later ballooned to over €700mn. 

In the original 2017 budget, revenues were planned at MKD187.6bn (€3.1bn) and total costs at MKD206.2bn with a deficit of 3% of projected GDP.

“We will do everything to make a pragmatic budget, oriented towards the implementation of reform priorities and paying back the debts accumulated by the previous government,” Tevdovski was cited by broadcaster MRT. He gave no details about when the draft budget revision will be sent to the parliament for approval.

Tevdovski also said that the government may decide not to issue a new Eurobond, which was planned by the previous government.

“Maybe we will decide not to issue a Eurobond … we are looking for all options for financing liabilities at lower prices," Tevdovski was cited as saying.

The intention is to speed up the economic growth with the ultimate aim of restoring the liquidity of the economy, he added. 

A day earlier, the finance ministry said that the yield of Macedonia’s three Eurobonds on international markets are constantly falling, which is a sign that investors are positively assessing the stabilisation of the political situation in the country. The yield on the latest €450mn Eurobond issued in July 2016 with maturity in 2023 fell to 3.9% from over 4.5% in mid-May.

According to information released by Raiffeisen Bank International (RBI) in April, the previous government led by conservative VMRO-DPMNE planned a new Eurobond issue in the fourth quarter of 2017 to repay maturing debts due next year.