STATE AUDIT OFFICE
- Press Release-
Skopje 13.01.2026
Weaknesses in capital investments and contractual payments pose financial and legal risks for the TIDZ
The audit found that 287 hectares of the total usable area of the Technological Industrial Development Zones (TIDZ) and industrial zones are not functionally utilized, i.e. they have not been leased, while seven out of the total 16 zones, covering an area of 203.5 hectares, as well as one industrial zone with an area of 3.2 hectares, have not been put into operation, i.e. have not been leased to potential users
The State Audit Office conducted an audit of the financial statements, along with a compliance audit, of the Directorate for Technological Industrial Development Zones (DTIDZ) for 2024.
Across the country, the government has established 16 Technological Development Zones (TIDZs) and three Industrial Zones, all of which are managed and overseen by the DTIDZ. Procedures have also been initiated to establish new TIDZs in the municipalities of Kumanovo and Lipkovo.
Weaknesses, irregularities and instances of non-compliance were identified, which led to the issuance of an adverse opinion on the fairness and accuracy of the 2024 financial statements and their compliance with legal regulations, guidelines, and established policies for the Core Budget Account (637). Additionally, a qualified opinion was issued regarding the fairness and accuracy of the financial statements and their compliance with legal framework, guidelines and established policies for 2024 for the Self-Financing Activities Budget Account (787).
The audit revealed that ongoing investments in the zones, in the amount of 4.243.216.000 denars or 68.995.382 euros, are still recorded as construction in progress. No depreciation or revaluation has been calculated for them, although most of these assets have already been put into use. The reason for this is that the conditions and legal requirements for obtaining usage permits have not been fulfilled.
A three-year investment program, intended as a long-term planning document for DTIDZ’s activities, had not been adopted by the end of 2024. It was eventually approved in December 2024 and covers the period 2025-2027.
Inconsistencies were identified in the procurement planning process and in the execution of concluded contracts. For the construction of temporary accommodation facilities and first-aid clinics, kindergartens, and warehouses with associated infrastructure (parking lots) in TIDZ Skopje 1 and TIDZ Skopje 2, as well as temporary accommodation facilities, kindergartens, and warehouses with associated infrastructure (parking lots) in TIDZ Štip and TIDZ Prilep, turnkey contracts were concluded in 2023 with a total value of 1.781.800.000 denars, including VAT or 28.972.357 euros.
The audit determined that the procurement was planned and executed without a prior cost-benefit analysis, a feasibility study assessing the economic justification, and prepared project documentation, including bills of quantities and calculations, although this is an exceptionally large and complex capital investment.
The estimated value of the procurement was determined without comprehensive and reliable analyses, relying solely on a price list for engineering services. The legal option for conducting a technical dialogue with economic operators was not utilized, nor was the procedure carried out as procurement by lots, despite the different types of facilities and locations involved. For the execution of the contract, an advance payment of 20% of the contract value, amounting to 302.000.000 denars or 4.910.569 euros, was made at the end of 2023.
Weaknesses were also identified in the execution of the contract, which does not include a clearly defined payment mechanism for the preparation of project documentation, creating legal uncertainty and financial risk for the contracting authority. In July 2025, DTIDZ submitted an information note to the Government outlining the need for an amicable termination of the contract.
For the construction of an administrative building in TIDZ Štip, a contract was concluded in December 2022 with a value of 212.398.000 denars, including VAT, or 3.469.886 euros. Significant weaknesses were identified in its execution. Specifically, an annex was signed for additional and unforeseen works due to imprecise project documentation and bills of quantities. The construction of the retaining wall and access road was not covered by the project documentation for which a building permit had been issued, which is not in compliance with the Law on Construction. Furthermore, the contractor commenced the procurement and installation of a wastewater treatment plant without prior approval for modifications during construction from the competent ministry.
In January 2023, DTIDZ concluded a consultancy contract to select a partner for a public-private partnership (PPP) for TIDZ Gevgelija, valued at 39.044.000 denars (634.832 euros) with an initial implementation period of one year, later extended by annex to April 2024. The audit found that restrictive and discriminatory technical and qualification criteria resulted in only one bid, while two subsequent public calls in 2023 and 2024 were cancelled due to no submissions. Although 85% of the contract value (33.088.000 denars) was spent, key project activities related to partner selection and concluding the PPP agreement were not completed, indicating inefficient use of budgetary funds.
In September 2023, DTIDZ concluded a framework agreement with two economic operators for the promotion of foreign direct investments, marketing, and production of promotional materials, valued at 15.340.000 denars for a period of two years. This amount was increased by annex in February 2024 by an additional 2.950.000 denars, bringing the total to 18.290.000 denars (a 19% increase). Obligations totaling 16.862.000 denars were undertaken in 2023 and 2024. The audit found that some of the services related to event organization were carried out despite DTIDZ having an in-house Marketing and Communications Sector. Due to the absence of established indicators to measure outcomes, the audit could not verify the necessity or effectiveness of the services provided under the agreement.
The audit revealed that 287 hectares of the total usable area of TIDZ and industrial zones are not functionally utilized, meaning they have not been leased. Furthermore, seven out of the 16 zones, covering a total area of 203.5 hectares, and one industrial zone of 3.2 hectares have not been put into operation; that is, the space has not been leased to users. Between 2009 and 2023, investments totaling 143.408.000 denars (2.3 million euros), or 3,4% of the total amount of assets under construction, were made in the zones that were not operational, primarily for the construction of basic internal infrastructure, project documentation, and land expropriation.
TIDZ Radoviš, not operational (drone footage)
DTIDZ’s accounting records show retained deposit liabilities of 39.655.000 denars from previous years related to construction contracts. Infrastructure in the zones is built in phases, and technical inspections can only be performed once the infrastructure is completed as a functional whole and once a use permit is issued by the competent ministry. Consequently, TIDZ does not refund retained deposits to contractors, and the facilities remain recorded as assets under construction. These circumstances have resulted in accumulated liabilities and a real risk of legal claims by contractors.
The audit found that under a lease agreement for commercial premises concluded in January 2024, a deposit of 7.181.000 denars was paid. Due to inconsistencies in the lease terms and the handover of the premises in December 2024, steps were taken to terminate the lease by mutual agreement, and legal proceedings were initiated. As of the audit date, the deposit has not been returned by the lessee.
In the section on Other Matters, the audit highlights several systemic weaknesses related to assets recorded as assets under construction, the management of state aid, and non-compliance with legal requirements regarding salaries.
Recommendations have been made to address the identified issues.
Press Contact:
Albiona Mustafa Muhaxhiri +389 72228 203 [email protected]
Mijalche Durgutov +389 70 358 486 [email protected]
Martin Duvnjak +389 75 268 517 [email protected]