North Macedonia is a small open economy that has successfully overcome the early phase of transition by implementing several structural reforms and ac-hieving macroeconomic stability in the early years after its state independen-ce. However, the country still struggles to become a functional and fully-fledged market economy and suffers from persistent macroeconomic imbalances stru-ctural in nature (Raveni, 2021). This chapter undertakes a rigorous examinati-on of North Macedonia’s economic evolution, with a primary focus on the early post-independence period following its secession from the former Yugoslavia in 1991. As the least developed republic within the socialist federation, North Ma-cedonia was thrust into a position of acute economic vulnerability, confronted by the dual challenges of forging an independent state and transitioning from a centrally planned to a market-oriented economy. The chapter opens by situa-ting North Macedonia’s economic predicament within the broader regional and historical context, elucidating the profound structural weaknesses and external dependencies that defined its early post-socialist trajectory.