Interview

ALFA TV interviews U.S. Ambassador Philip T. Reeker

October 27, 2008

Alfa TV: At the beginning of next month you will be travelling to the U.S. with a Macedonian delegation led by PM Gruevski to promote Macedonia as an investment opportunity. Are you optimistic that we have the potential to attract foreign investments?

Ambassador Reeker: The Macedonian Embassy in Washington under the leadership of Ambassador Jolevski has organized two business forums in the United States. The first will be held in the San Francisco Bay Area including Silicon Valley on November 11, and the second in Chicago on November 14. These will be opportunities to educate American business people from different sectors of the economy about opportunities for trade and investment in and with Macedonia.

Alfa TV: Except for Johnson Control, there is almost no other major American investment in Macedonia since its independence. The U.S. is our major strategic partner. What do you think, why is that so?

Ambassador Reeker: It is true that Johnson Control is the largest green field investment by U.S. company in Macedonia, but it is not the only US investor. Back in 2002 a company invested over four million dollars in an auto parts production facility in the Ohrid area. There are also U.S. companies represented here in terms of franchises – McDonalds obviously, Pepsi, Coca Cola, Holiday Inn. And of course, there are a number of U.S. companies with offices here including the information technology sector. IBM recently opened an office here, Hewlett-Packard, Cisco, Oracle, , Ernst &Young, PriceWaterhouseCoopers, Avon. So these are important representatives of major U.S. sectors. There is also investment in the wine industry, which is a growing opportunity for other foreign investment in this country. Our plan through these business fora in the United States, again, is to expose potential investors and interested business people to opportunities in Macedonia. We want to make sure they understand the potential here and it is important for the Macedonian government and Macedonian institutions to make sure that there is a stable, predictable business climate for potential U.S. investors here in Macedonia. So, that is what we will be working on, to expand those possibilities. This of course, is a long term process.

Alfa TV: Do you believe that we have stable and predictable business climate here?

Ambassador Reeker: A number of reforms have been made. I think there have been some very positive reforms and you have to keep building on those reforms. It is important to make sure that there is a clear independent judiciary in Macedonia, that contracts are enforced, that current foreign investors feel comfortable and can tell their story in a positive way to potential new investors. It is important that tenders by the Government are handled transparently, that there is a feeling of fairness in the process. We have tried to help through our programs to build this sort of infrastructure, to help Macedonia’s institutions develop the capacity that U.S. investors and most foreign investors will look for when they are making decisions about where to make new investments, where to join partnerships, where to target their business decisions. So, it is very important that those processes be nonpolitical.

Alfa TV: The financial crisis that was triggered by bad mortgage loans in the US led to serious consequences in the global economy. All forecasts say that in such circumstances investors postpone their investment plans. You will be lobbying for investments amidst the global crisis. Why are you optimistic that even in these circumstances this will happen?

Ambassador Reeker: As you know, the fundamental problem in the current global financial crisis is a lack of liquidity in credit markets which makes money available to businesses for expansion or to see a business through a difficult time. Obviously this makes it a more difficult time to be talking about foreign investment. But in fact, the smart businessmen, the companies that are looking to their future want to think about now what they would do in the future. This crisis will resolve itself, economies go up and down and they will be looking for opportunities to expand, opportunities to look at new markets and that’s why we want now to present Macedonia as an opportunity.

Alfa TV: In this context there is a theory that major companies will look for cheap markets to expand their businesses. However, at this moment we need a clear NATO and EU perspective so that these investors can come and feel confident that Macedonia is a safe country. Do you think that the unresolved name issue with Greece can diminish our chances to attract investors in this period?

Ambassador Reeker: I have no doubt here that membership in NATO will make Macedonia a more attractive destination for foreign investors. I believe that your leadership would agree with that. I’ve heard from many businessmen in the U.S. who ask about this process and who have told me that having the stability and the security that NATO membership brings would make them more confident in looking at investment opportunities here in Macedonia. And indeed, you can look at several examples throughout the region, countries like Slovenia, Hungary, Bulgaria, Romania, where NATO membership has made a real difference in terms of their ability to attract foreign investment. I think it is important that Macedonia continue in the process to find a solution to the name issue which is the only factor which is preventing Macedonia from joining NATO.

Alfa TV: There have been rumors lately that the latest proposal by mediator Nimetz is a Greek-Macedonian plan, then that it is a Macedonian-American plan. Is there any truth in this and do you believe in a quick solution to the name?

Ambassador Reeker: Let me be very clear. As we have said for many many years, there is no American plan. There is a UN process, led by Ambassador Nimetz and that is the process that we support. Obviously, we take an interest in this, so do may other countries around the world. President Bush has been very clear that we stand ready to try to help the process if we can. But this is a process that must be handled by Greece and Macedonia. Only Greece and Macedonia can come to an agreement to resolve this question. And that’s what it takes, that’s why we have supported the UN process and I think Macedonia’s leaders certainly know and understand that. This is a difficult question, I understand that myself, but I think it takes leadership, it takes a certain brave approach to the question, it takes discussion with the people of Macedonia about the options and what the future can bring, because I believe, and I think the people of Macedonia believe, that NATO membership is crucial for Macedonia’s future.

Alfa TV: We spoke about Johnson Controls, but probably the new U.S. Embassy is the biggest investment here in Macedonia. Can you reveal the costs for the construction and can you tell us how many new jobs will it open for Macedonian citizens?

Ambassador Reeker: We are very excited about our new Embassy, which is being constructed here in Skopje. We hope that it will be finished sometime next spring and ready for us to move in. It will give us an opportunity to consolidate in one location the various buildings that we now occupy in Skopje, including warehouse space. This is something that obviously takes time. It is an investment on the part of the U.S. government, but it is very much a standard embassy, like those we have built in other countries here in the region, if you look in Zagreb or Sofia and indeed around the world. It meets the security demands that the modern world requires but it also is a symbol of the U.S.-Macedonia relationship and our commitment to working with the Republic of Macedonia to see a better future for all the citizens of this country. Indeed, we believe that that benefits the United States as well because a stable, prosperous Europe, a stable and prosperous Balkans is good for world peace, is good for business opportunities in the region and that is our goal. So, we hope to move in by next summer. We have over 60 U.S. employees at our Embassy, including those from the United States Agency for International Development [USAID]. We have over 230 local Macedonian employees who make everything possible, all of the work that we do. There may be additional opportunities once we get into the new embassy. Any time we have job opportunities in the Embassy we post those job openings at our Internet website and anyone can look at that and apply for those jobs. So, I think this will be an important step for us.

Alfa TV: You did not tell me the price.

Ambassador Reeker: I don’t know what the final cost will be. There is a fairly standard cost that goes with each one of these embassies. We’ll see once they finish what the final price tag is. But our Congress, which allocates funding for building overseas, approved a new embassy in Skopje.

Alfa TV: You will leave to the US two days after the presidential elections. The US is proven and major strategic partner of Macedonia. Will this apply in future, no matter who the next US president will be, will it be Obama or McCain?

Ambassador Reeker: Indeed, the whole world is going to be watching our elections on November 4th. We shall have the results by November 5th. I always say that Macedonia has had and will have no better friend than the United States. Our commitment to Macedonia is not going to change. I am quite certain of that, regardless of whether Senator Obama or Senator McCain wins the election. Whoever our next President is, I am convinced that the first priority of that President would be to be pro-American and to be promoting United States interests. And as I said it has been our policy for long time, a stable and prosperous Macedonia is something we believe in and believe is in our common interest. As you know, I have also been telling people that the current administration, the current President is very aware of Macedonia, is aware of the name issue, asks about it regularly, our Secretary of State is aware of this issue. That will not be the case with the new President. That much I am certain. Tere are so many issues in the world for the new President to deal with that it takes time for them to rise to the top. So that’s why we have been encouraging resolution of the name issue and Macedonia’s rapid entrance into NATO in the next weeks and months. That is still possible, we have encouraged a rapid resolution of this now for some time, since the Bucharest Summit. But, let me be clear that I believe very firmly that whatever administration comes into power after the November elections and takes office January 20, 2009, the United States will still be a very strong friend of Macedonia.

Alfa TV: Are you sure that the Macedonian Government understands well your message that the new U.S. President will have too many other issues to address and is there a will on their part to solve the issue quickly?

Ambassador Reeker: That’s going to be up to Macedonia and to Greece. We cannot solve these problems for you.

Alfa TV: Do you see that there is willingness by both sides?

Ambassador Reeker: My view is that both sides will get to work together diligently. It requires leadership, it requires difficult decisions, but we believe that there is a process there. We believe that the people of Macedonia, all of its citizens have indicated their desire to take their rightful place as members of NATO and ultimately as members of the European Union as well. Macedonia is part of Europe, that’s a fact. That’s something we have believed since your independence and that’s what we want to see for you. I cannot predict what will happen in these cases and I cannot make the decisions for you. This is something that the two countries have got to work out. Resolve this, put this question behind you and move forward for a whole new range of opportunities in the world. That’s what I think the citizens of Macedonia deserve and certainly that’s what the United States supports.