Montenegro overview


In Montenegro we focus on:

  • Making the economy more competitive, integrated and green.
  • Using sustainable tourism as a lever for SME development and investment in related industries – such as agribusiness and sustainable municipal infrastructure – are the focal points in the document.
  • Working with the private sector to help it become more competitive including developing agribusiness value chains and backward linkages in the tourism sector. Connectivity and regional integration will be improved by expanding cross-border transport and energy links, in line with the Connectivity Agenda for the Western Balkans. And the green economy in Montenegro – which marks 25 years since proclaiming itself a “green state” – will be supported via sustainable tourism among other things.
  • Leveraging the country’s comparative advantages to develop agribusiness value chains, providing both investment and advice, to help Montenegro produce more local food for the tourism industry and decrease imports. Tourism – which is the main export product and growth driver in the country – is a big focus of the strategy which lists the following areas of potential EBRD engagement: “Upgrading the existing hotels stock through privatisation, addressing the seasonality issue by promoting development of congress tourism and health tourism facilities, and modernisation of related municipal and environmental infrastructure.

The EBRD’s latest Montenegro strategy was adopted on 3 May 2017

Current EBRD forecast for Montenegro’s Real GDP Growth in 2017 3.0%

Current EBRD forecast for Montenegro’s Real GDP Growth in 2018 3.3%

In Montenegro, growth picked up in 2015 to an estimated 3.1 per cent (from 1.8 per cent in 2014), with the increase primarily driven on strong FDI inflows and progress on a major Chinese-financed highway project. The tourism sector also performed well in 2015, as a drop in Russian tourists was more than compensated by an increase from other countries, particularly in the Western Balkan region. We expect growth in 2016 to rise further to 4 per cent, as the construction of the highway enters the full swing, another well-booked tourism season, as well as increase private consumption supported by the recent increase in public sector wages, pensions, and social benefits, before falling back to around 3 per cent in 2017 as post-election government spending is tightened. More generally, a major downside risk lies in the fiscal side, and the worrying rise in public debt in recent years may necessitate austerity measures elsewhere, especially if economic growth rates were to falter.

Montenegro in the EBRD’s 2016-17 Transition Report