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Montenegro Economy Profile 2018

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Economy - overviewMontenegro's economy is transitioning to a market system. As of 2015, around 90% of Montenegrin state-owned companies have been privatized, including 100% of banking, telecommunications, and oil distribution. Tourism, which accounts for roughly 20% of Montenegro’s GDP, brings in three times as many visitors as Montenegro’s total population every year. Several new luxury tourism complexes are in various stages of development along the coast, and a number are being offered in connection with nearby boating and yachting facilities. In addition to tourism, energy and agriculture are considered two distinct pillars of the economy. Only 20% of Montenegro’s hydropower potential is utilized. Montenegro plans to become a net energy exporter, and the construction of an underwater cable to Italy, which will be completed by 2018, will help meet its goal.

Montenegro uses the euro as its domestic currency, though it is not an official member of the euro zone. In January 2007, Montenegro joined the World Bank and IMF, and in December 2011, the WTO. Montenegro began negotiations to join the EU in 2012, having met the conditions set down by the European Council, which called on Montenegro to take steps to fight corruption and organized crime.

The government recognizes the need to remove impediments in order to remain competitive and open the economy to foreign investors. The biggest foreign investors in Montenegro are Russia, Italy, Cyprus, Denmark, Hungary and Serbia. Net foreign direct investment in 2016 reached $755 million and investment per capita is one of the highest in Europe.

Montenegro is currently planning major overhauls of its road and rail networks, and possible expansions of its air transportation system. In 2014, the Government of Montenegro selected two Chinese companies to construct a 41 km-long section of the country’s highway system. Construction will cost around $1.1 billion. Cheaper borrowing costs have stimulated Montenegro’s growing debt, which currently sits at 65.9% of GDP. Montenegro first instituted a value-added tax (VAT) in April 2003, and introduced differentiated VAT rates of 17% and 7% (for tourism) in January 2006. In May 2013, the Montenegrin Government raised the higher level VAT rate to 19%.
GDP (purchasing power parity)$10.86 billion (2017 est.)
$10.55 billion (2016 est.)
$10.3 billion (2015 est.)
note: data are in 2017 dollars
GDP (official exchange rate)$4.405 billion (2016 est.)
GDP - real growth rate3% (2017 est.)
2.5% (2016 est.)
3.4% (2015 est.)
GDP - per capita (PPP)$17,400 (2017 est.)
$16,900 (2016 est.)
$16,600 (2015 est.)
note: data are in 2017 dollars
Gross national saving7.8% of GDP (2017 est.)
6.1% of GDP (2016 est.)
6.7% of GDP (2015 est.)
GDP - composition, by end usehousehold consumption: 81.8%
government consumption: 21.2%
investment in fixed capital: 19.5%
investment in inventories: -0.1%
exports of goods and services: 42.1%
imports of goods and services: -64.5% (2013 est.)
GDP - composition by sectoragriculture: 8.3%
industry: 21.2%
services: 70.5% (2013 est.)
Population below poverty line8.6% (2013 est.)
Labor force263,200 (2014 est.)
Labor force - by occupationagriculture: 5.3%
industry: 17.9%
services: 76.8% (2014 est.)
Unemployment rate17.1% (2016 est.)
17.6% (2015 est.)
Unemployment, youth ages 15-24total: 37.7%
male: 39.9%
female: 34.5% (2015 est.)
Distribution of family income - Gini index26.2 (2013 est.)
24.3 (2010)
Budgetrevenues: $1.62 billion
expenditures: $1.95 billion (2016 est.)
Taxes and other revenues36.8% of GDP (2016 est.)
Budget surplus (+) or deficit (-)-7.5% of GDP (2016 est.)
Public debt71.3% of GDP (2016 est.)
69.3% of GDP (2015 est.)
note: 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 intra-governmental debt; intra-governmental 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
Inflation rate (consumer prices)2.1% (2017 est.)
-0.3% (2016 est.)
Commercial bank prime lending rate9.22% (31 December 2014 est.)
9.36% (31 December 2013 est.)
Stock of narrow money$749 million (31 December 2011 est.)
$783.3 million (31 December 2010 est.)
Stock of broad money$1.982 billion (31 December 2011 est.)
$2.01 billion (31 December 2010 est.)
Stock of domestic credit$2.63 billion (31 December 2014 est.)
$2.682 billion (31 December 2013 est.)
Market value of publicly traded shares$7.532 billion (31 December 2014 est.)
$3.827 billion (31 December 2012 est.)
$3.322 billion (31 December 2011 est.)
Agriculture - productstobacco, potatoes, citrus fruits, olives, grapes; sheep
Industriessteelmaking, aluminum, agricultural processing, consumer goods, tourism
Industrial production growth rate4.5% (2013 est.)
Current Account Balance-$889 million (2017 est.)
-$791 million (2016 est.)
Exports$370.2 million (2014 est.)
$489.2 million (2012 est.)
Imports$1.982 billion (2014 est.)
$2.4 billion (2012 est.)
Reserves of foreign exchange and gold$599.6 million (31 December 2014 est.)
Debt - external$1.576 billion (31 December 2014 est.)
$1.433 billion (31 December 2013 est.)
Stock of direct foreign investment - at home$483 million (31 December 2014 est.)
$446.5 million (31 December 2013 est.)
Stock of direct foreign investment - abroad$133 million (31 December 2014 est.)
Exchange rateseuros (EUR) per US dollar -
0.906 (2017 est.)
0.9214 (2016 est.)
0.9214 (2015 est.)
0.885 (2014 est.)
0.7634 (2013 est.)
Fiscal yearcalendar year

Source: CIA World Factbook
This page was last updated on January 20, 2018

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