This report covers the key macroeconomic and financial releases as well as the political events from Montenegro for the period of January 6 - February 5, 2015.
The European Bank for Reconstruction and Development (EBRD) predicted a 3% economic growth for Montenegro in 2015 in the January edition of its Regional Economic Prospects report, improving its forecast from the previous edition released in September. The more optimistic forecast is based on expectations for strong FDI inflows and progress on a major highway project, the bank said in the report. At the same time, the World Bank forecasted that Montenegro’s GDP will grow by 3.4% in 2015, quickening from an estimated 1.5% rise in 2014. The country’s economic growth is forecast to cool in 2016 to 2.9% and to 3.0% in 2017.
Montenegro’s government plans to scrap VAT and imports fees on investors during the period of construction and equipment of large investment projects, including construction of five and more stars hotels, energy and manufacturing utilities.
Montenegro’s economy ministry has started preliminary talks with bidders in a tender to concession offshore oil and gas exploration blocks. The country opened the tender in August 2013, offering investors to apply for one or more of the overall 13 blocks in the Adriatic offshore. It has said it will pick up not one but several investors.

Key points:

• The 2014 budget gap stood at €103.5mn
• The number of foreign tourists visiting Montenegro rose 8% y/y in December
• Industrial output contracted by 7% in December
• Unemployment rate fell to 16.4% in Q3 - labour force survey
• Bank assets rose 5.9% y/y to €3.13bn at end-December