Montenegro: Invertir a Montenegro
Montenegro has the potential to become a magnet for investment because of its business-focused economic system and low corporate tax rate. According to the latest data available from the World Bank, Montenegro´s total FDI inflows reached EUR 663 million, with the highest level of foreign investments coming from NATO member countries (EUR 230 million), while Russia and China together invested EUR 170 million. The stock of FDI was estimated at USD 6.5 billion in 2020 (UNCTAD - 2021 World Investment Report), with a per capita investment ratio among the highest in Europe. The sectors attracting most of the FDI are tourism, real estate, energy, telecommunications, banking and construction. Data from the Montenegrin Investment Promotion Agency shows that the main investing countries are Russia, Italy, Norway, Austria, Hungary and the United Kingdom.
The Montenegro Foreign Investors’ Council (MFIC) states that a decline in the ease of doing business was expected because of the corona crisis in six specific sectors: telecommunications and ICT, banking and finance, tourism, manufacturing and energy, trade and retail, and transport and logistics have been evaluated and all of them saw a decrease.
The country enjoys great economic freedom and monetary stability. Domestic and foreign companies enjoy equal treatment in Montenegro. Foreign companies can own 100% of a domestic company, and their profits and dividends can be repatriated without limitations or restrictions. Nevertheless, corruption, the politicisation of justice, organised crime, an approximate and unreliable land registry and a sluggish bureaucracy are obstacles to FDI. The Privatization and Capital Investment Council is the governmental institution that manages, controls, and implements the privatization process in the country, which already involved almost 90% of formerly state-owned enterprises. The country ranks 50th out of 190 economies in terms of ease of doing business according to the latest Doing Business report from the World Bank, stable in comparison to the previous edition. Some initiatives have been taken to improve the business environment such as the establishment of the Credit Guarantee Fund to foster credit lines for banks.
Foreign Direct Investment | 2019 | 2020 | 2021 |
FDI Stock (million USD) | 5,411 | 5,697 | 6,361 |
Number of Greenfield Investments* | 10 | 5 | 3 |
Value of Greenfield Investments (million USD) | 582 | 872 | 99 |
Source: UNCTAD, Latest available data
Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.
Country Comparison For the Protection of Investors | Montenegro | Eastern Europe & Central Asia | United States | Germany |
Index of Transaction Transparency* | 5.0 | 7.5 | 7.0 | 5.0 |
Index of Manager’s Responsibility** | 8.0 | 5.0 | 9.0 | 5.0 |
Index of Shareholders’ Power*** | 6.0 | 6.8 | 9.0 | 5.0 |
Source: Doing Business, Latest available data
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.
To learn more you can visit the MIA website, the government agency dedicated to investment promotion.
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Actualitzacions: January 2023