Intellinews Montenegro Country Report - February 2012

The IntelliNews Montenegrin Country Report is a monthly report, covering the major macroeconomic indicators and trends in Montenegro, as well as important political developments. Prepared by local analysts, it provides the most accurate data, updated regularly according to the data changes noted by the whole range of statistics sources. It will save the time you would need to track the figures and sources independently and will provide you with thorough analysis.

Additional Information

EU's decision to set target date for the launch of Montenegro's accession talks and Montenegro's success in keeping budget deficit and public spending within the Maastricht criteria are two of the greatest achievements of the government in 2011, the PM said. The Montenegrin economy has seen a recovery in almost every sector, with projected GDP growth of at least 2.5% in 2011, Luksic noted. Efforts for fiscal consolidation also proved successful as public spending was cut from 47.2% in 2010 to 42.6% of GDP in 2011 and the budget gap has been reduced from 3.9% in 2010 to around 3.3% in 2011.

In December, agency S&P said it is affirming its 'BB' long-term and 'B' short-term sovereign credit ratings on Montenegro as the outlook remains negative on risks related to external financing. The credit rating agency expects the economy to grow by less than 1%, given the international economy in 2012. The biggest downside growth risks include the worsening growth outlook in the eurozone or renewed deterioration in bank balance sheets. Tourism, on the other hand, which was spared by the global downturn, is projected to continue supporting growth in the coming years.

Central bank’s view on next year’s economic growth in Montenegro is that the country will not slip into recession but will likely see a lower economic growth. Current projections indicate a GDP growth of 1.8% for 2012 while the 2012 budget draft envisages a GDP increase of 2%.