Foreign direct investment in North Macedonia continues to grow, with a notably strong first quarter of 2026. These figures are no coincidence: investors from Europe, the region and beyond increasingly recognize the country as a practical and favorable location for manufacturing, services and regional headquarters. Below we summarize the main advantages, from the tax framework to the protection of capital, available to an investor who decides to do business here.
Why do foreign investors increasingly choose North Macedonia?
The advantages combine low and simple taxes, incentives in the free economic zones, a strategic position at the crossroads of Corridors 8 and 10, and competitive labor costs with a solid skills base. On top of that come the stability of the denar, pegged to the euro at a fixed rate for decades, and access to larger markets: the country is a member of CEFTA and has a Stabilisation and Association Agreement with the European Union, which enables largely duty-free trade with the European market.
What taxes apply to companies with foreign capital?
The corporate income tax is flat, identical for domestic and foreign entities, and at a rate of 10 percent ranks among the lowest in Europe. Dividends and other distributions to owners are taxed at a low flat rate, and the system is designed to be simple, without hidden tax categories that surprise newcomers. For the investor this means a predictable tax bill already at the planning stage, which is a rarity in the region.
What do the free economic zones offer?
The technological industrial development zones are the state's most powerful instrument for attracting capital. Zone users benefit from exemptions from corporate income tax and from personal income tax for their employees over an extended period, customs and VAT reliefs on imports of equipment and materials intended for export-oriented production, as well as prepared infrastructure and simple, one-stop administrative procedures.
| Feature | Company in a zone | Company outside a zone |
|---|---|---|
| Corporate income tax | Exemption over an extended period | Flat rate of 10% |
| Customs and VAT on production imports | Reliefs for equipment and materials | Regular regime |
| Infrastructure | Prepared plots and utility connections | Arranged by the company itself |
| Administration | One-stop services within the zone | Standard procedures |
| Best suited for | Manufacturing and export-oriented activities | Services, trade, local market |
What rights does a foreign investor have over the company and its profits?
The foreign investor enjoys national treatment: they may own a company fully, at one hundred percent, without a mandatory domestic partner, and the manager may be a foreigner. Profits, dividends and proceeds from the sale of a shareholding may be freely transferred abroad, with no restrictions on repatriation. Beyond domestic legislation, investments are also protected by a network of bilateral investment promotion and protection treaties that the country has concluded with most of the countries from which capital traditionally originates.
Which questions need to be resolved before the investment?
- Choice of legal form: whether to establish a new company, a branch of the foreign entity or a joint venture with a domestic partner, depending on the activity and tax planning
- Location and zones: whether the activity meets the conditions for free economic zone status and which zone is the most suitable
- Real estate: legal entities registered here may acquire real estate for their operations, while special statutory conditions apply to foreign individuals and are checked in advance
- Workforce: employment contracts, collective frameworks and, where foreign staff are needed, residence and work permits for foreign nationals
- Contracts with domestic partners: supply, agency and distribution arrangements must be aligned with Macedonian law and protected with appropriate clauses
Planning an investment or expansion in North Macedonia?
We assess your situation and propose the most favorable structure: company form, location, tax planning and support throughout the entire registration process. With our preventive law packages we keep protecting the investment afterwards: contracts, employment matters, tax compliance and day-to-day legal support.
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This text is general legal information and does not constitute legal advice for a specific case. For advice tailored to your situation, consult an attorney.