The government is committed to improving cooperation with EU countries, but also countries in the region, which is a good way to prepare for EU membership, as well as the effective future use of structural funds. It is essential to raise awareness in Montenegro, and the region as well, of the opportunities offered by closer integration and reforms.
“The turning point in Montenegro’s history, both politically- and democratically-wise, happened on 4th December 2020. The period of monopoly was left behind us, and with the arrival of the new government came new energy, with knowledgeable, enthusiastic and wishing to create prerequisites for a better future for the Montenegrin citizens. I am satisfied with the cooperation between our two countries, but it can always improve and I think that even more attention should be paid to economic cooperation in mutual interest.”
What will be the most important segments that the new Government will focus on? Are they European integrations, boosting regional cooperation or maybe the economy?
We are aware that EU and NATO integrations are also a powerful driving force behind reforms, economic prosperity and the rule of law. I believe that Montenegro will remain a loyal and committed ally of NATO and that it will fulfil the obligations assumed by this membership. Montenegro’s main foreign policy goal is to continue the EU accession process and ultimately become an EU member.
The key to strengthening the economy and achieving a high standard that facilitates investments, economic growth and job creation lies in aligning with EU policies, so it is clear that the European vision of development has no alternative. The government is committed and doing everything with special care in order to expedite the negotiations with the EU. The survey conducted last year is even more encouraging, showing that 77.6% of Montenegrin citizens have a positive attitude towards the EU, compared to 66.1% in December 2019. With so much support from the citizens and the right path chosen by the Montenegrin government with Prime Minister Krivokapić at its helm, which is being committed to the integration process, I have no doubt that we will significantly contribute to the process of becoming a full-fledged member of the European family.
Serbia is traditionally our important external trade partner, and the common history is something that additionally connects us
What was the goal of your recent visit to several countries in the region, including Serbia, where you spoke with their respective officials?
In the past few months, I have been on official visits to Bosnia and Herzegovina, Croatia, Serbia and Slovenia. In a little over a month and a half, I stayed in Serbia twice, where in late April, I met with the Minister of Economy of Serbia, the President of the Chamber of Commerce, and at the beginning of June, with the Minister of Trade.
One of the goals we want to accomplish is to boost and improve bilateral relations between Montenegro and its neighbours, which may not have been at an enviable level lately. The visits were organized to get to know these countries’ leaders in person and discuss further forms of cooperation in more detail. In our talks, we also focused on the economic recovery plans of the countries after the pandemic. I think it is very important that in these challenging times we rely on each other and help the economy recover as much as we can. In this regard, and to the mutual satisfaction and benefit, Montenegro will be open to all tourists this year, and we have prepared special benefits for guests from the region.
How would you rate the overall economic cooperation between Serbia and Montenegro today?
We want to nurture a friendly relationship in which European values are the common denominator. I believe that activities should be intensified in order to provide an additional stimulus to economic cooperation between the two countries.
Serbia is our main partner in both exports and imports, while Montenegro is among Serbia’s most important partners in terms of exports of its products. We cooperate mostly in trade and tourism, and while telecommunications cooperation is also important to us. What makes us all very happy is that roaming charges will be abolished on July 1 for the citizens of our countries, i.e. all Western Balkan countries. As far as cooperation in tourism is concerned, there is a great potential for a joint appearance on distant, so-called third markets in different economic sectors. Our new national airliner, Air Montenegro, which will soon have five daily flights to Belgrade – three from Tivat and two from Podgorica – has been recently launched.
Shortly, the Joint Commission for Economic Cooperation between Serbia and Montenegro will meet in Podgorica, during which the Business People Forum will be agreed upon. I think that the economic cooperation between Serbia and Montenegro is on an upward path.
This year, we are focusing on our traditional emitting markets – the region and Russia, but also on tourists from Western European countries
Which segments Montenegro needs to work on in the coming period in order to join the EU as soon as possible?
Our government’s four key priorities are defined in line with the priorities of the European Commission (“The European Green Deal”, “The Europe Fit for the Digital Age”, “An Economy that Works for People”, “A Stronger Europe in the World”, “Promoting our European Way of Life” and “A New Push for European democracy”) and we are determined to achieve synergies and full coherence between domestic and EU policies.
The Ministry of Economic Development (MED) is in charge of almost a third of the negotiating chapters (9 negotiating chapters are under the Ministry’s direct jurisdiction while 2 are also largely under its jurisdiction). In addition to the adoption of the normative framework, the focus will be on implementing and creating a good and stable economic space following EU standards.
In the forthcoming period, our goal is to intensify activities on fulfilling obligations from the European agenda, to achieve more visible progress in the negotiations and meet the conditions for closing some of the most advanced chapters: 6 – Company Law, 7 – Intellectual Property Law and 20 – Enterprise and Industrial Policy, for which is the MED is largely competent.
The Covid-19-induced crisis has caused a decline in economic activity. What measures are planned when it comes to boosting the economy? What are both the Government’s and Ministry’s plans?
Unfortunately, that’s right. The coronavirus pandemic has exposed all the shortcomings of the Montenegrin economy, which last year recorded a dramatic decline of as much as 15.2%. The main causes of this decline are primarily travelling bans, a sharp decline in the tourism industry, a decline in domestic and foreign consumption and restrictions on imports and exports of goods and services. However, another important reason that contributed to the obvious decline is the wrong crisis management or bad border management policy. I can say with certainty that no expert analysis or simulation could point to the structural vulnerabilities and shortcomings of our economy as precisely and unequivocally as this crisis has done. On the other hand, this is a good starting point for us in terms of the information needed to take further steps when it comes to advancing the economy of Montenegro.
Economic diversification is imperative for our further development. We will focus on the processing industry, the development of crafts and the green economy, which includes energy efficiency, the use of renewable sources, sustainable development and a healthy environment with developed agriculture and tourism. We will encourage the introduction and use of the principle of circular economy, which integrates the economy and the waste management system. Promoting innovations and supporting innovative activities, through the establishment of the Innovation Fund, is also one of the important activities on the Government’s agenda. The goal of the reform of the Investment and Development Fund, which is underway, is to allocate funds more efficiently and focus more on the sector of small and medium-sized enterprises, which make up 98.5% of the total number of companies and employ 53.5% of the workforce in Montenegro.
With the regional synergy, we can build a safe and reliable market that will have an impact on the growth of the Western Balkan economy
What are your expectations when it comes to the recovery of the Montenegrin economy and the tourism sector this year?
Our plan for economic recovery will take several important directions. These are – the fight against the shadow economy, the reform of state-owned enterprises, and reforming the National Employment Bureau, as one of the priorities. Through the adoption of measures to support citizens and the economy during the first two quarters of this year, the Government did a lot to create conditions for a successful tourist season, which is one of the priority goals for this year. We are especially pleased with the fact that a total of 29 airlines are flying in 2021, of which seven companies are flying to Montenegro for the first time.
Unlike the previous government, we opted for an open border policy. In early spring, we opened the borders to the countries of the region and for some time, have lifted entry restrictions for the citizens of Russia, Ukraine and Belarus, as well as the EU countries, Israel, Moldova and North Macedonia. We believe that this direction in border management is very important, especially in the context of tourism recovery.
There are currently about 58,000 tourists in our country, 80% compared to the same period in 2019. The current epidemiological situation in our country is excellent and it is realistic to say that in early July, when the EU updates the “green list”, Montenegro will be on it. Bearing in mind that mass vaccination in Montenegro began in early May, we can boast that at this time, 32% of the adult population has been vaccinated with the first dose, and 27% has been re-vaccinated.
All this indicates good prospects for a successful tourist season and the possibility of generating income from tourism at between 60-65% level from 2019. I think that this percentage is quite realistic and achievable and that our projections will come true. We are further encouraged by the forecasts made by the World Bank in its latest report, which upped the forecast for the growth of the Montenegrin economy this year to 7.1%, which indicates that we are well on our way to economic recovery.
Will further regionalization and joint initiatives of the Western Balkan countries contribute to the overall development of both the region and the countries individually?
The Government of Montenegro strongly supports the idea of the economic integration of the region and wants the Montenegrin economy, together with the economies of the region, to achieve maximum benefits through the implementation of activities envisaged by the trade part of the Action Plan for the Common Regional Market 2021-2024.
The Chamber Investment Forum of the Western Balkan Six will facilitate mutual contacts and promote the region as a single investment destination, representing over 350,000 companies, and create new opportunities for stronger connections between the region’s business communities. By creating a single market, the WB will become more competitive on the international scene and more attractive as a destination for foreign investments, which will further strengthen not only the region but also the economy of each country individually.
Meetings in region
You also met with the president of the Chamber of Commerce and Industry of Serbia (CCIS). What sectors have the potential for improving economic cooperation between the two countries?
The importance of connecting the economies of our two countries was highlighted at the meeting, as well as the commitment of the Government of Montenegro to boosting regional cooperation. I believe that the relocation of the Office of the Regional Chamber of Commerce from Trieste to Podgorica will be an additional impetus for the overall cooperation of the Region. Strengthening economic ties, economic development and improving the business environment, as well as joint investments in capital projects, are the basis for building up cooperation between our two friendly and fraternal countries. During the meeting, an important topic of the joint border crossing was also talked about, where one of the CCIS’ urgent initiatives will be to support both our countries in establishing a joint border crossing that will facilitate entry of both passengers and goods. During the meeting, the potentials of the Port of Bar were also discussed, which I believe is an untapped resource that should be used much more meaningfully.