This report summarizes the findings of an Allocative efficiency analysis on the Former Yugoslav Republic (FYR) of Macedonia `s national HIV epidemic and response conducted in 2014-15. The report addresses core questions for resource allocation such 'How can HIV funding be optimally allocated to the combination of HIV response interventions that will yield the highest impact?' or 'What level of investment is required to achieve national targets, if we allocate resources optimally?'. The report describes epidemiological and HIV financing trends as well as identifies sub-populations, which are most affected by the epidemic. Based on this information, the optimized mix of interventions for minimizing new HIV infections and deaths is identified using mathematical modeling techniques. Required investments into programs for key populations and antiretroviral treatment are established and translated into policy recommendations. The FYR Macedonia experiences a low level, concentrated HIV epidemic. The small number of people currently living with HIV is attributable, in part, to an effective HIV response to date. There is increasing HIV prevalence among certain key population groups, particularly men who have sex with men (MSM) and male sex workers (MSW). This recent trend warrants early attention. MSM accounted for 64 percent of newly diagnosed people living with HIV in 2014. In that same year, programs specifically targeting MSM accounted for only 2.4 percent of HIV spending.