Update No: 122 - (26/07/07)
The blessed place
Montenegro seems to be a happy land, celebrating a year of highly successful
independence. It actually voted narrowly to be independent on May 21st in a
referendum. few doubt that today it would vote by far more than the 55% then to
go its own way.
It is experiencing a huge interest in its property market from abroad, as well
as a surge in tourism, that now sees more than one miillion visitors per annum.
The Adriatic jewel is becoming world renowned, where, for instance, the last
spectacular James Bond film was shot, Casino Royale. The Rolling Stones were in
town recently and gave a concert. Celebrities jostle each other in the main
hotels and restuarants and the locals are becoming quite blasé about them.
A downside though is that Russian mafia abound. Actually the original home of
mafia, Italy, is also providing a supply of unwholesome visitors. But then
Montenegro was always notorious for smuggling and gangsterism in the old
Yugoslavia. It all brings in a lot of money - "black" though it may
Property transactions rise by 400%
Montenegro is of course a tiny place of 660,000 people. An influx of
millions of dollars has sent property prices soaring.
According to a recent report compiled by global real estate experts, Colliers
International, there has been a 400% rise in Montenegro property investment
transactions over the past two years driven largely by British, Irish and
Russian demand and commitment. It is the World's fastest growing tourist venue.
This consistently increasing property investment commitment from foreign buyers
is running hot on the heels of a report by the World Travel and Tourism Council,
which last year tipped Montenegro to become the fastest growing travel and
tourism economy in the world.
Montenegro is seeing an exceptionally ferocious land grab driven by the nation's
strong commitment to the travel and tourism industry.
Government have completely accepted the lynchpin role that travel and tourism
will have for the future development of the nation's economy and labour market.
To that end it is doing all it can to attract and retain foreign direct
investment into anything and everything associated with tourism market expansion
Promotion of tourism
To see how this is working on the ground one can just take what is happening
at one glamorous resort, Budva, right on the Adriatic. With the signing of a
contract about strategic partnership, the Tourist Organization of the
Municipality of Budva and the First Bank of Montenegro will together promote
tourist values and the potential of this 'metropolis of tourism.'
The contract about partnership, which predicts the future cooperation of these
two institutions, has the goal of further promotion of tourism all round in
Budva through cultural organizations, events of entertainment, and improvement
of promotional activities. It was signed by the director of TO Budva, Tanja
Kazanegra, and Miodrag Vucinic, in the name of the First Bank, at the ceremonial
celebration of three years since the foundation of the Tourist Organization of
Budva. Formal signing of the contract was preceded by a cocktail party on the
Citadel, at which media, business partners and sponsors were given a thank you
note by TO Budva for their quality cooperation.
Vucinic pointed out that the signing of the protocol about business cooperation
is a recognition and confirmation that the First Bank is a desirable partner and
a part of every good plan in Montenegrin tourism. "Our cooperation began in
carrying out of the projects of events and I believe that in TO Budva's
cooperation with the First Bank of Montenegro we will make great progress that
will directly contribute to a higher level of quality of tourism in Budva. This
cooperation will be developed in the area of promotion of our Riviera in
Montenegro and abroad," pointed out Kazanegra.
The viewpoint of the Mayor of Budva, M.A. Rajko Kuljaca, is that with the
signing of this contract the right choice has been made. "I wish a
successful cooperation to TO Budva and the First bank of Montenegro and I
promise that the local administration will help them in everything," said
The following captures the flavour of modern Montenegro:-
Europe's new golden coast: Millionaires, tycoons and celebrities are bringing
glamour to Montenegro's shores
By Daniel McLaughlin in Budva
Sunday July 15, 2007, The Observer
Zarko Radulovic's family was not wealthy and his two decades as a ship's captain
were not lucrative, but this week the Rolling Stones stayed at his hotel and
things are looking up. He is a man of modern Montenegro, the world's youngest
independent state, where glittering wealth and glamour mask poverty and
corruption and a small elite is benefiting from the sale of swathes of the
country to foreign tycoons and celebrities.
Radulovic's 10 floors of glass and pale stone, topped by a helicopter pad,
shimmer between mountains and the Adriatic. Yet in 2005 three explosions rocked
the building site and an investigator was shot dead. 'The local mafia did it
because this was the first big investment here by people who were not part of
any lobby and had no "protection",' said Radulovic in one of the
hotel's bars, looking out across Budva town, the beach and the bay to the island
resort of Sveti Stefan.
Turf wars are not Budva's only worry: last month Serbian war criminal Vlastimir
Djordjevic was found here after six years on the run from charges of crimes
Businessmen show no sign of taking fright in Montenegro, however, along a
coastline blessed with a balmy climate and stardust from the days when Richard
Burton, Elizabeth Taylor and Sophia Loren stayed at Sveti Stefan. A dozen miles
up the coast, Canadian gold miner Peter Munk is transforming a naval shipyard
into a £75m marina complex for mega-yachts and, to the south at Velika Plaza,
international investors are jostling for the right to develop a five-mile-long
A year after the split with Serbia, the Rolling Stones played on a Budva beach
hoping that it would raise the country's profile, just as it was helped by
Casino Royale, which took Daniel Craig as James Bond to Montenegro to play
poker. Catherine Zeta-Jones and Michael Douglas have been house-hunting around
the walled town of Kotor, near where racing driver Ralf Schumacher bought land,
along a littoral where property prices have quadrupled in four years.
Russians are now the most prominent investors. Dwarfing other private jets last
week at Dubrovnik airport, 10 miles up the coast from Montenegro, was the Boeing
767 of Chelsea owner Roman Abramovich. His spokesman said he was on holiday on
one of his yachts. Metals magnate Oleg Deripaska, a man as rich as Abramovich
who also has a house in London and was linked to a bid for Arsenal last year,
owns the aluminium smelter and bauxite mine which produce 80 per cent of
Montenegro's exports. He wants to buy a power station that provides electricity
for a third of its 650,000 people, giving him control of half the nation's
Nebojsa Medojevic, leader of the opposition, which has temporarily blocked the
power station deal, says: 'One side of the Montenegro coin is yachts, flashy
cars, fancy villas, and the other side is destroyed industry, no jobs in the
north, people moving to the coast for work. It's unsustainable - we have 200
miles of coastline and you can't build a luxury marina in every village.'
Budva's infrastructure is sagging under the weight of tourism and illegal
building, but the council found £1m to prepare Jaz beach for the Rolling
Stones, where VIPs on yachts paid £1,300 to watch from the bay. At £23, even
the cheapest tickets were beyond most locals' means.
'I used to dream Montenegro could one day look like Monte Carlo,' said Radulovic
in his hotel, which is part Russian-owned. 'Now I think that in 10 years, it
will be better than Monte Carlo.'
Montenegro's economic future unstable
Montenegro should create financial reserves so as to secure its economic
future, an expert says.
Belgrade economist Ljubomir Madžar told the Podgorica daily, Dan, that
Montenegro at present had a considerable inflow of funds from abroad via
privatisation, real estate sale, and loans, but added it was a one-off situation
that soon might end.
"Montenegro took out a massive mortgage on its economic future," he
said, stressing it would be wise to create state financial reserves as soon as
According to Madžar, foreign inflow "demobilized domestic development
efforts, lead to uncontrolled and irrational spending, and decelerated economic
A new defence agreement is signed with Slovenia
Slovenian Defence Minister, Karl Erjavec, and his Montenegrin counterpart, Boro
Vucinic, signed an agreement on defence cooperation between the two former
Yugoslav countries, Mnnews reported.
The agreement provides a good base for future cooperation between the two
countries and opens the possibilities to further upgrade the good relations in
the field of defence, both ministers said after signing the agreement. The pair
agreed that the Western Balkan region including Montenegro should be given EU
and NATO prospects. Vucinic said that Slovenia's EU and NATO accession presented
a good role model, and expressed the wish that Montenegro would take the same
path. "Through cooperation we can obtain a lot of knowledge and experience,
which will help us on the way to European and Atlantic organisations," he
said. Montenegro, a country of some 650,000 people, maintains a small
professional army of only 2,500 troops.
Israel to strengthen cooperation proposals
The ambassador of Israel in Belgrade, Jafa Ben-Ari, met with Montenegrin Prime
Minister, Zeljko Sturanovic, to strengthen the bilateral cooperation between two
countries. During the talks, the ambassador said that Israel entrepreneurs are
willing to participate in implementing various projects on the existing and in
the construction of new capacities in Montenegro, Mnnews reported.
Both sides agreed that they should organise meetings of entrepreneurs of the two
countries in order to intensify and concretise the deals about the application
of the project in the area of traffic, agriculture, tourism, and protection of
environment, as well as of establishing of airline traffic. Sturanovic stated
that the relations of two countries are good, but that the possibilities of
bilateral cooperation have not been used, and that there exists more room for
further promotion especially in the economic area. Sturanovic and Ben-Ari noted
that after the renewal of independence of Montenegro the conditions have been
made for strengthening of general relations and further strengthening of
political dialogue, which should result in development of concrete forms of
The tourists are coming! The tourists are coming!
According to a report of The World Council for tourism and travelling,
Monetengro, for the fourth year in a row is among the three fastest growing
tourists economies of the world. Director of Public Enterprise, "Morsko
dobro," Rajko Barovic, said the trend would continue through partnership of
the private and public sector. He anticipates a very successful upcoming tourist
season and the PE is well prepared for this summer to meet the growing
expectations of the great number of guests, Mnnews reported.
"We will do everything to welcome and monitor the season in the best
possible way. For us that means a lot of work, but also a challenge, which moves
us forward, and with which, I am convinced, we can deal with. Our effort has
been proved with the reward, which we received for the promotion of the quality
of the offer in tourism 'Wild Beauty award,'" said Barovic.