Economy of Montenegro

The economy of Montenegro is mostly a service based economy, currently in the process of economic transition. The economy of this small Balkan state is recovering from the impact of the Yugoslav Wars, the decline of industry following the breakup of SFRY, and UN economic sanctions.

Economy of Montenegro
Podgorica National bank of Montenegro
CurrencyEuro (EUR)
Calendar year
Trade organisations
GDPIncrease $5.402 billion (nominal, 2018 est.)[1]
Increase $11.891 billion (PPP, 2018 est.)[1]
GDP rank150th (nominal, 2018)
149th (PPP, 2018)
GDP growth
2.9% (2016) 4.7% (2017)
4.4% (2018e) 2.9% (2019f) [2][3]
GDP per capita
Increase $8,651 (nominal, 2018 est.)[1]
Increase $19,043 (PPP, 2018 est.)[1]
GDP per capita rank
75th (nominal, 2017)
74th (PPP, 2017)
GDP by sector
Agriculture: 7.5%
Industry: 15.9%
Services: 76.6% (2016 est.)[3]
0.947% (2019f est.)[1]
2.604% (2018)[1]
2.4% (2017 est.)[3]
Population below poverty line
8.6% (2013 est.)[3]
Positive decrease 31.9 medium (2014, World Bank)[4]
Labour force
273,200 (2017 est.)[3]
Labour force by occupation
agriculture: 7.9%
industry: 17.1%
services: 75% (2017 est.)[3]
UnemploymentPositive decrease16.1% (2017 est.)[3]
Average gross salary
$906 (July 2017)[5]
$605 (July 2017)[5]
Main industries
steelmaking, aluminum, agricultural processing, consumer goods, tourism
51st (2017)[6]
ExportsIncrease $422.2 million (2017 est.)[3]
Export goods
Main export partners
 Serbia 22.7%
 Croatia 22.7%
 Slovenia 7.8% (2012 est.)[7]
ImportsIncrease$2.618 billion (2017 est.)[3]
Import goods
Food,oil products,natural gas,clothes,industrial products.
Main import partners
 Serbia 29.3%
 Hungary 10.9%
 Greece 8.7%
 China 7.1% (2012 est.)[8]
FDI stock
Decrease $737.7 million (31 December 2017 est.)[3]
Decrease Abroad: $39.77 million (31 December 2017 est.)[3]
Negative increase -$780 million (2017 est.)[3]
Negative increase $2.516 billion (31 December 2017 est.)[3]
Public finances
Negative increase67.2% of GDP (2017 est.)[3][note 1]
-5.6% (of GDP) (2017 est.)[3]
Revenues$1.78 billion (2017 est.)[3]
Expenses$2.05 billion (2017 est.)[3]
Standard & Poor's:[9]
BB+ (Domestic)
BB (Foreign)
BB+ (T&C Assessment)
Outlook: Negative[10]
Outlook: Negative
Foreign reserves
Increase $1.077 billion (31 December 2017 est.)[3]
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars.


As a relatively small principality and kingdom, Montenegro made its first steps towards an industrial economy only at the turn of the 20th century. The causes for this relative delay lay in the small population, lack of raw materials, underdeveloped transport network and comparatively low rate of investment. However, this delay in industrialization had its positive effects - Montenegro survived as a specific ecological oasis.

The first factories were built in Montenegro in the first decade of the 20th century, followed by wood mills, an oil refinery, a brewery, and electric power plants. This brief evolution of industrial economy was interrupted by new wars - First Balkan War (1912–1913), followed by World War I and World War II. Between the two world wars, agriculture maintained its dominant position in the national economy, while the sole remaining industrial plants were wood mills, tobacco factories, breweries, and salt works.

SFR Yugoslavia era

The economy made major progress only after World War II, as Montenegro became part of the SFRY. In the period following World War II, Montenegro experienced a period of rapid urbanization and industrialization. An industrial sector based on electricity generation, steel, aluminum, coal mining, forestry and wood processing, textiles and tobacco manufacture was developed, while trade, international shipping, and particularly tourism became increasingly important by the late 1980s.


Due to its favourable geographical location (it had access to the Adriatic Sea and a water-link to Albania across Lake Skadar) Montenegro became a hub for smuggling activity. The entire Montenegrin industrial production had stopped, and the republic's main economic activity became the smuggling of user goods - especially those in short supply like petrol and cigarettes, both of which skyrocketed in price. It became a de facto legalized practice and it went on for years.

Divergence from Serbian unity

In 1997, Milo Đukanović took control over the ruling party DPS and began severing ties with Serbia. He blamed policies of Slobodan Milošević for the overall decline of the Montenegrin economy. Resurgent inflation led the Montenegrin government to "dollarize" the economy, adopting the German mark unilaterally, and insisting on taking more control over the country's economic fate. This eventually resulted in creation of Serbia and Montenegro, a loose union in which the Montenegrin government assumed predominant responsibility for its economic policies.

This was followed by implementation of faster and more efficient privatization, passing of reforming legislation, introduction of a VAT. When the German mark was replaced by the euro, the latter became Montenegro's legal tender despite objections from Brussels. The government established a medium-term plan of economic reforms, popularly referred to as "The Agenda".

Despite implementation of reform laws and privatization of most of publicly owned companies, the living standard of Montenegrins did not improve significantly during this period. The government, with Milo Ðukanović still as the Prime minister, blamed the slow progress on Serbia. Some arguments used to support this position were that foreign debt was higher in Serbia by one third, that unemployment was significantly lower in Montenegro. It was also argued that troublesome cooperation of Serbian government with the Hague war crime tribunal, ongoing Kosovo status process and general political turmoil in Serbia were hampering Montenegro's attractiveness to investors and delaying its progress towards full membership in European Union and NATO.

A referendum was held on May 21, 2006 in which the people of Montenegro voted by a slender majority in favour of Montenegrin independence from Serbia.


A ferry in Montenegro. September, 2018.

Following the independence referendum, Montenegro's economy has continued to transform into a more service-based one, with the proclaimed goal of becoming the elite tourist destination, and joining the European Union. Efforts have been made to attract the foreign investors into tourism greenfield investments, as well as in large infrastructure projects, both needed to facilitate the tourism development.

Montenegro has experienced a real estate boom in 2006 and 2007, with wealthy Russians, Britons and others buying property on Montenegrin coast. Montenegro received, as of 2008, more foreign investment per capita than any other nation in Europe. Due to foreign direct investment, the Montenegrin economy has been growing at a very fast pace in recent years. However, Late 2000s recession will inevitably slow down the growth, as the biggest greenfield investments (development of Velika Plaža, Ada Bojana, Buljarica, Jaz Beach, construction of Bar-Boljare motorway, new power plants) may be postponed. The recession is also hitting hard on Podgorica Aluminium Plant, built in 1969 and the biggest single contributor to GDP, and a major exporter.

In the first half of 2012, Montenegro exported goods (mostly metals) worth 182,3 million €, which is 14,6% less than the same period the preceding year. The major export partners were Croatia (47,2 million €), Serbia (36,8), Bosnia and Herzegovina and Hungary (12,7). The import (mostly food, oil and electrical energy) was 864,9 million €, which is 2,6% more than the same period the preceding year. The major import partners were Serbia (249,2 million €), Greece (73), Bosnia and Herzegovina (59,8).[11]

Banking sector of Montenegro is highly concentrated with high share of foreign capital. Banks in Montenegro usually operate as universal banks, providing retail and corporate banking products and services. During the recent years (2007-2016), the banks have been attracting deposits from both Montenegrin residents and non-residents. Most of the banks offer non-resident accounts, usually to both natural persons and legal entities.[12]


An income Tax rate of 9% is applied for monthly personal gross income below EUR 751 per month, and tax rate of 11% for income above EUR 751, in 2013 it was a 15% rate.[13] Additional income reported in the annual tax return is also subject to 9% tax rate.[14]

See also


  1. ^ data cover general government debt, and includes debt instruments issued (or owned) by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities, as well as intragovernmental debt; intragovernmental debt consists of treasury borrowings from surpluses in the social funds, such as for retirement, medical care, and unemployment; debt instruments for the social funds are not sold at public auctions


  1. ^ a b c d e f "World Economic Outlook Database, April 2019". International Monetary Fund. Retrieved 11 April 2019.
  2. ^ "Spring 2019 Europe and Central Asia Economic Update "Financial Inclusion" p. 9" (PDF). World Bank. Retrieved 11 April 2019.
  3. ^ a b c d e f g h i j k l m n o p q r "The World Factbook". Central Intelligence Agency. Retrieved 23 January 2019.
  4. ^ "GINI index (World Bank estimate)". World Bank. Retrieved 23 January 2019.
  5. ^ a b "Prosječne zarade (Plate) Jul 2017.godine". (in Montenegrin). 30 August 2017. Retrieved 12 September 2017.
  6. ^ "Ease of Doing Business in Montenegro". Retrieved 2017-01-23.
  7. ^ "Export Partners of Montenegro". CIA World Factbook. 2012. Retrieved 2013-06-21.
  8. ^ "Import Partners of Montenegro". CIA World Factbook. 2012. Retrieved 2013-07-24.
  9. ^ "Sovereigns rating list". Standard & Poor's. Retrieved 26 May 2011.
  10. ^ a b Rogers, Simon; Sedghi, Ami (15 April 2011). "How Fitch, Moody's and S&P rate each country's credit rating". The Guardian. Retrieved 31 May 2011.
  11. ^ B92, Crna Gora najviše uvozi iz Srbije, 26.07.2012
  12. ^ Offshore Banking in Montenegro
  13. ^
  14. ^

External links

2014 Conference of Western Balkan States, Berlin

Conference of Western Balkan States was a 28 August 2014 conference of heads of states and governments of Western Balkans region initiated by German chancellor Angela Merkel. An idea for organization of conference came in light of the celebration of the 100th anniversary of the beginning of World War I. It is the first conference in this framework and organizers expressed their desire to continue it in future with Vienna and Paris mentioned as a potential next hosts after Berlin (so called Berlin Process). Günther Oettinger confirmed at conference that event will be organised annually with Vienna as a host city in 2015 and Paris in 2016.The German chancellor announced intention to organize a conference on 7 June 2014. Invitation for participation was sent to all the countries of South Eastern Europe including Croatia and Slovenia that were already members of the European Union at the time of conference.The main intention was to show commitment for process of Future enlargement of the European Union, little progress of Bosnia and Herzegovina and Macedonia in that process and relations of Serbia with Russia in the light of International sanctions during the 2014 pro-Russian unrest in Ukraine.During the Foreign Ministers’ segment, Albanian Foreign Minister Bushati underlined the importance of making this initiative periodical, as well as finding the right instruments to enable, in future years, the drafting and implementation of concrete joint projects in the region. In this regard Albanian delegation presented a document under the title "Albanian Working Paper for the Western Balkans Conference in Berlin", which is based in the vision of "a region in peace and well prepared to join the European Union, by guarantying a dignified living for all its citizens."At conference was announced future visit of Albanian Prime Minister Edi Rama to Serbia. It will be the first meeting of this type between two countries after 1947 meeting of Enver Hoxha with President of Yugoslavia Josip Broz Tito. However, an incident during a football match in Belgrade has cast doubt on this visit. Edi Rama eventually visited Serbia on 10 November 2014 to meet his Serbian counterpart but tempers flared when Rama said that Kosovo's independence was "undeniable" and "must be respected" and Serbian Prime Minister Aleksandar Vucic accused him of a "provocation".Franz Lothar Altmann, expert on the Balkans, stated in his pre-conference interview for Radio Free Europe/Radio Liberty that conference proves increasing importance of Balkan region, especially with respect to Ukraine crisis.

ATA Carnet

The ATA Carnet, often referred to as the "Passport for goods" or "Merchandise passport", is an international customs document that permits the tax-free and duty-free temporary export and import of nonperishable goods for up to one year. It consists of unified Customs declaration forms which are prepared ready to use at every border crossing point. It is a globally accepted guarantee for Customs duties and taxes which can replace security deposit required by each Customs authorities. It can be used in multiple countries in multiple trips up to its one-year validity. The acronym ATA is a combination of French and English terms "Admission Temporaire/Temporary Admission." The ATA carnet is now the document most widely used by the business community for international operations involving temporary admission of goods.

The ATA Carnet is jointly administered by the World Customs Organization (WCO) and the International Chamber of Commerce (ICC) through its World Chambers Federation.

Central Bank of Montenegro

The Central Bank of Montenegro (Montenegrin: Centralna Banka Crne Gore) is the central bank of Montenegro. The mission of the central bank is to establish and maintain a sound banking system and monetary policy.

Economy of Serbia and Montenegro

Serbia and Montenegro was a confederated union which existed between 2003 and 2006. The two republics initially formed the Federal Republic of Yugoslavia in 1992.

The economy of Serbia and Montenegro entered a prolonged decline in 1989. Exacerbated by the economic embargo imposed during the Bosnian war, the Federal Republic of Yugoslavia (FRY) economy's downward spiral showed no real sign of recovery until 1995. GDP was nowhere near its 1991 level, but the NATO bombing in 1999 of the basic infrastructure of the country and many factories, as well as a renewed embargo caused a further huge drop in GDP in relation to the 1991 level. The first sign of an economic recovery occurred in 2001 after the removal of Milošević on 5 October 2000. A vigorous team of economic reformers has worked to tame inflation (non-energy inflation is less than 9% in 2002, down from over 120% two years earlier) and rationalize the SCG economy. GDP, although only half of its 1997 level, is projected to increase steadily in the near future. As of January 2005 GDP has recovered to 55-60% of its 1990 level, due to GDP growth of 8.5% in 2004.

Economy of the Socialist Federal Republic of Yugoslavia

Despite common origins, the economy of the Socialist Federal Republic of Yugoslavia (SFRY) was significantly different from the economies of the Soviet Union and other Eastern European socialist states, especially after the Yugoslav-Soviet break-up of 1948. The occupation and liberation struggle in World War II left Yugoslavia's infrastructure devastated. Even the most developed parts of the country were largely rural and the little industry the country had was largely damaged or destroyed.

Investment Migration Council

The Investment Migration Council (IMC), based in Geneva, Switzerland, was founded in 2014 as a not-for-profit organisation. The Council's mission is to set standards in the investment migration industry worldwide. The IMC supports and interacts with other associations, governments and international organisations in the investment migration field. In addition, the Council supports the industry in improving the public understanding on investment migration, which is a new industry and seen by some as controversial, through education and its code of ethics and professional conduct.The IMC is the organiser of the annual, Investment Migration Forum in Geneva, in the French region of Switzerland. The Forum brings together over 300 participants from representatives of international organisations to government officials, and academics. Attendees from 40 plus countries share their views and their ideas, over a three-day period, through roundtable- and panel-discussions.

Mediterranean University

Mediterranean University (Montenegrin: Univerzitet Mediteran) is a university located in Podgorica, Montenegro. It was founded on 30 May 2006, is the first private university established in Montenegro and is organized in 6 faculties. The university is member of the Balkan Universities Network.

Montenegrin Littoral

The Coastline of Montenegro, also called the Montenegrin Littoral (Montenegrin and Serbian: Црногорско приморје / Crnogorsko primorje), historically the Littoral or the Maritime, is the littoral region in Montenegro which borders the Adriatic Sea. Prior to the Creation of Yugoslavia, the Montenegrin Littoral was not part of the Kingdom of Montenegro, but rather a bordering region of the Austro-Hungarian Empire, latterly part of the State of Slovenes, Croats and Serbs.

Montenegrin nationalism

Montenegrin nationalism refers to the nationalism of Montenegrins and/or the culture of Montenegro. Contemporary Montenegrin nationalism cites that an independent Montenegrin culture separate from Serbian culture arose after Serbia was taken over by the Ottoman Empire in the 14th century while Montenegro remained independent for many years, resulting in a different culture developing in Montenegro.Montenegrin nationalism became a major political issue in World War I when a schism arose between Montenegro's clans over plans to merge Montenegro with the Kingdom of Serbia, between the pro-independence Green clans, that included the King of Montenegro amongst them, versus the pro-unification White clans. Montenegrin ethnicity was recognized by the Communist government of Yugoslavia in the 1960s though it had been declared previously.During the breakup of Yugoslavia in the early 1990s, Montenegro's President Momir Bulatović supported unity and alliance with Serbia as well as supporting irredentist claims to Dubrovnik and territory in Herzegovina that he stated were historically part of Montenegro. The Serbian journal Epoha in 1991 declared that if Bosnia and Herzegovina's Bosniaks wanted to secede from Yugoslavia, that Eastern Herzegovina should be ceded to Montenegro. The International Criminal Tribunal for the former Yugoslavia declared that the Serbian and Montenegrin leadership during the Siege of Dubrovnik sought to annex Dubrovnik along with the "coastal regions of Croatia between the town of Neum, Bosnia and Herzegovina, in the north-west and the Montenegrin border in the south-east" into Montenegro.After 1998, Montenegro's government led by Milo Đukanović demanded greater autonomy within the Federal Republic of Yugoslavia. In 2006, a majority of just over 55 percent of Montenegrins voted in favour of independence from the state union with Serbia.


Montenegro ( (listen); Montenegrin: Црна Гора / Crna Gora [tsr̩̂ːnaː ɡɔ̌ra]) is a country in Southeast Europe on the Adriatic Sea. It borders Bosnia and Herzegovina to the northwest; Serbia and Kosovo to the east, Albania to the south and Croatia to the southwest. Montenegro has an area of 13,812 square kilometres and a population of 620,079 (2011 census). Its capital Podgorica is one of the twenty-three municipalities in the country. Cetinje is designated as the Old Royal Capital.

During the Early Medieval period, three principalities were located on the territory of modern-day Montenegro: Duklja, roughly corresponding to the southern half; Travunia, the west; and Rascia proper, the north. In 1042, archon Stefan Vojislav led a revolt that resulted in the independence of Duklja from the Byzantine Empire and the establishment of the Vojislavljević dynasty. The independent Principality of Zeta emerged in the 14th and 15th centuries, ruled by the House of Balšić between 1356 and 1421, and by the House of Crnojević between 1431 and 1498, when the name Montenegro started being used for the country. After falling under Ottoman rule, Montenegro regained de facto independence in 1697 under the rule of the House of Petrović-Njegoš, first under the theocratic rule of prince-bishops, before being transformed into a secular principality in 1852. Montenegro's de jure independence was recognised by the Great Powers at the Congress of Berlin in 1878, following the Montenegrin–Ottoman War. In 1905, the country became a kingdom. After World War I, it became part of Yugoslavia. Following the breakup of Yugoslavia, the republics of Serbia and Montenegro together established a federation known as the Federal Republic of Yugoslavia, which was renamed State Union of Serbia and Montenegro in 2003. On the basis of an independence referendum held in May 2006, Montenegro declared independence and the federation peacefully dissolved on 3 June of that year.

Since 1990, the sovereign state of Montenegro has been governed by the Democratic Party of Socialists and its minor coalition partners. Classified by the World Bank as an upper middle-income country, Montenegro is a member of the UN, NATO, the World Trade Organization, the Organization for Security and Co-operation in Europe, the Council of Europe, and the Central European Free Trade Agreement. It is a founding member of the Union for the Mediterranean.

Montenegro Stock Exchange

The Montenegro Stock Exchange (MNSE) (Montenegrin: Montenegroberza AD) is a stock exchange located in Podgorica, Montenegro. It is Montenegro's only stock exchange.

The MNSE was founded 1993, and is a member of the World Federation of Exchanges, Federation of European Securities Exchanges and Federation of Euro-Asian Stock Exchanges. As of 10 January 2011 it fully incorporated NEX Stock Exchange, also in Podgorica, forming a single Montenegrin capital market.

Trading on the MNSE consists of short and long term securities, six investment funds, bonds, and shares from government funds portfolios. The MONEX20 and MONEXPIF are the principal stock indices of the Montenegro Stock Exchange.

The Montenegro Stock Exchange is a member of the Federation of Euro-Asian Stock Exchanges.

Montenegro real estate taxes

On May 21, 2006, the majority of 55.53% voted in a referendum for Montenegro as an independent state. The Government of the country declared its intentions to join EU and NATO. Shortly after that it became a 192nd member of United Nations in July 2006. In the press release of 29 June the Government “emphasized the readiness and determination to build its development policy on the United Nations’ principles and make an active contribution towards achieving the goals and universal values advocated by the UN”. But the process of integration into European community and economic development began in 1991 when Montenegro proclaimed to be ecological state and thus created favorable tourist conditions and attractive property investment opportunities. The country's Ministry of Tourism and Environment Protection in 2001 unveiled the Tourism Master Plan, a blueprint for all tourism planning and targets up to 2020. In April 2003 Montenegro joined the Council of Europe. According to World Travel & Tourism Council report the Government of Montenegro is successfully implementing the plan and “have adopted most of the recommendations put forward by WTTC in its 2004 Country Report - exceeding both the forecasts and goals that were set”.Situated at the shore of Adriatic Sea Montenegro has 117 unique sandy and pebble beaches. UNESCO-protected bay of Kotor and the Tara canyon are of particular value, which enables Montenegro to achieve such success in tourist and property market over the last decade. There are four national parks, which are the most attractive and ecologically best preserved nature reserves (Durmitor, Biogradska gora, Lake Skadar, and Lovcen). The intentions are to establish two more.

NEX Stock Exchange

The New Securities Stock Exchange or NEX Stock Exchange (NEX) was a stock exchange located in Podgorica, Montenegro. The NEX Stock Exchange was founded 2001. It was one of two principal stock exchanges in Montenegro, the other being the Montenegro Stock Exchange, also in Podgorica. In January 2010, stockholders in NEX approved a merger with the Montenegro Stock Exchange, initially expected to take place within two to three months. However, the two were technically merged as of 31 December 2010, with their systems jointly operating since 10 January 2011. Thus, NEX Stock Exchange ceased to exist as a legal subject. The merger consolidated and simplified securities trading in Montenegro.

Outline of Montenegro

The following outline is provided as an overview of and topical guide to Montenegro:

Montenegro – sovereign country located on the Balkan Peninsula in Southern Europe. It has a coast on the Adriatic Sea to the south and borders Croatia to the west, Bosnia and Herzegovina to the northwest, Serbia and Kosovo to the northeast, Albania to the southeast. Its capital and largest city is Podgorica, while Cetinje is designated as the Prijestonica (meaning the old royal capital or former seat of the throne).

The thousand-year history of the Montenegrin state begins in the 9th century with the emergence of Duklja, a vassal state of Byzantium. In those formative years, Duklja was ruled by the Vojislavljevic dynasty. In 1042, at the end of his 25-year rule, King Vojislav won a decisive battle near Bar against Byzantium, and Duklja became independent. Duklja's power and prosperity reached their zenith under King Vojislav's son, King Mihailo (1046–81), and his son King Bodin (1081–1101). From the 11th century, it started to be referred to as Zeta. It ended with its incorporation into Raska, and beginning with the Crnojevic dynasty, Zeta was more often referred to as Crna Gora or by the Venetian term monte negro. A sovereign principality since the Late Middle Ages, Montenegro saw its independence from the Ottoman Empire formally recognized in 1878. From 1918, it was a part of various incarnations of Yugoslavia. On the basis of a referendum held on 21 May 2006, Montenegro declared independence on 3 June. On 28 June 2006, it became the 192nd member state of the United Nations, and on 11 May 2007 the 47th member state of the Council of Europe. On 15 December 2008, Montenegro presented its official application to the European Union, with the hopes of gaining EU candidate status by 2009.

U.S.–Montenegro Business Council

The U.S. – Montenegro Business Council is a Maryland-based trade association aimed at promoting trade and investment opportunities between the United States and Montenegro. With offices in both Maryland and Montenegro, the U.S. – Montenegro Business Council makes available to its members a forum whereby they can familiarize themselves with the business opportunities available in both countries and identify appropriate institutions and individuals who can assist in this process. To fulfill this mission, the U.S. – Montenegro Business Council assists its members by providing them with the resources and knowledge necessary to successfully pursue business opportunities in the United States and Montenegro.

Sovereign states
States with limited
Dependencies and
other entities
Other entities

This page is based on a Wikipedia article written by authors (here).
Text is available under the CC BY-SA 3.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.