Montenegro’s economic growth in 2024 slowed compared to 2023, as reported by the Center for Economic and European Studies (CEES). The center emphasized the urgency of adopting the state budget for this year, as the country faces significant debt repayments.
Key highlights from the CEES report include:
- Economic growth: Real GDP growth in 2024 is estimated to be around 3.2%, driven by strong household consumption, stable government spending, and investment. However, the economy faced challenges like a 3.6% decline in tourism revenue and a 6.4% drop in exports of goods and services.
- Employment and wages: Employment increased by 5.4%, while average wages rose by 7.7% from January to October.
- Investment dependency: The growth model relied heavily on construction sector investments, which are expected to stabilize in the medium term, potentially leading to a decline in overall economic activity.
- Government budget: CEES raised concerns about the proposed budget’s focus on current consumption over capital spending, which could increase the deficit to nearly €280 million. Public debt and fiscal challenges are expected to rise as a result.
- Inflation outlook: The inflation rate is projected to decrease from 3.4% in 2023 to 2.6% in 2024, aided by a more stable macroeconomic environment and planned pension increases.
- Foreign investment trends: Foreign direct investments grew by 14%, but real estate investments saw a 5% decrease, potentially indicating market saturation.
The CEES also outlined its 2024 agenda, focusing on supporting sustainable public finances, monitoring fiscal risks and improving corporate governance in public enterprises. The center is also involved in an anti-corruption project with US Embassy support.
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