Update No: 116 - (25/01/07)
Podgorica proclaimed independence in June following the
referendum at which more than 55% of voters supported the break-up of
Serbia-Montenegro, which was the last remnant of the former communist
Moscow on the Adriatic
The world's newest country, Montenegro, is also one of its most beautiful, the
venue which was chosen for making the latest James Bond movie, Casino Royale. It
is becoming a major tourist attraction. Indeed it is expected to have the
world's fastest growing tourist economy in the next decade (see below).
Properties on the coast are rocketing up in price. 'Montenegro' means Black
Mountain, which may prove prophetic. There can be few better investment
opportunities as the Russians come to town, making it Moscow on the Adriatic.
Muddle over official language
It is threatened by a possible constitutional crisis because its leaders
can't agree on the name of the language they speak. The government, which led
Montenegro to independence, wants to make the official language Montenegrin --
but a large majority of the tiny Balkan state's people believe they speak
Montenegro broke away from a union with traditional partner Serbia following an
historic referendum in May this year.
It has strong historic and cultural links with Serbia, as well as a shared
Orthodox Christian religion and language, which only differs slightly in
Serbian remains its official language despite the ruling pro-independence
coalition's plans to change it to Montenegrin in line with similar moves in
Bosnia and Croatia in the 1990s.
About 60% of Montenegro's 650 000 population say they speak Serbian, compared
with just 21% of those who claim to use Montenegrin, according to a 2003 census.
The issue has become crucial as Montenegro needs to draft a new constitution as
soon as possible, since it became independent more than six months ago and still
has no new charter.
A pro-Serbian bloc of parties, the strongest opposition group in Montenegro's
Parliament, has been insisting that Serbian should remain in official use.
Montenegro Joins The IMF And World Bank
Montenegro is being welcomed as a new member of the world community. It has
joined the International Monetary Fund (IMF) and the World Bank, boosting each
institution's total membership to 185 countries.
Both the IMF and the World Bank made separate announcements about Montenegro's
membership on January 18th. IMF chief Rodrigo de Rato said the country's
transition to independence has been impressive and economic activity has
recovered. He also noted that the country has increasingly become the focus of
De Rato further pointed out that "the future holds many challenges.
Achieving a sustained increase in prosperity will require sound economic
management, in order to establish the conditions for economic growth and
stability - not least in harnessing the benefits of strong foreign direct
investment and tourism for the country's future development."
Montenegrin TV notes that "The original IMF statute and World Bank
convention were signed by the Montenegrin Finance Minister and Central Bank
Council President, Igor Luksic and Ljubisa Krgovic respectively. … With its
membership in the IMF and World Bank Montenegro has completed its integration
into the global economic system and has won the right to apply for financial aid
like all the other members of these organizations. … Membership in the IMF is
very important because with the help of this international organization's
program's Montenegro will accelerate its journey to the European Union, Krgovic
pointed out. Luksic believes that membership in the IMF and World Bank is of
exceptional importance for Montenegro because of its future ratings, and that it
is an excellent signal to all potential investors who are prepared to invest in
"Montenegro's quota, or stake in the IMF, was set at US$41.2 million out of
a total of US$325 billion of the 185 members. … The World Bank said it is
developing a new four year strategy for Montenegro to help shore up public
finances and to encourage private sector investments. 'The strategy, which is
expect to be completed by mid-2007, is likely to focus on supporting Montenegro
on the path toward European Union membership; promoting growth and jobs through
investments in environmentally sustainable tourism infrastructure, along with
other high priority infrastructure needs; and supporting government efforts to
strengthen and streamline social services such as health and education,' the
The following from the London Stock exchange is
Montenegro property 'spurred on by tourism'
While property prices in Montenegro are relatively lower than in established
markets, the expected growth of the country's tourism industry is likely to see
the market develop significantly.
According to Andrea Marston, general manager of Dream Croatia, while a number of
investors chose to move into the country's emerging market by purchasing land
for development, the country is predicted to offer investors new opportunities.
Citing research by the World Travel and Tourism Council, Ms Marston suggests
that Montenegro's tourism economy is expected to become the fastest growing in
the world over the next decade.
"This does mean that a booming tourist sector demands more property for
rent, which consequently spurs on the property market," she remarks.
While offering a "stark beauty", the country is planning further
improvements to its infrastructure, such as roads and water, in anticipation of
the growth in tourism.
Diplomatic relations launched with Greece
Greece opened diplomatic relations with Montenegro on December 18th, which won
independence from its union with Serbia in a nationwide referendum in May last
year, Deutsche Presse-Agentur (dpa) reported.
Greek Foreign Minister, Dora Bakoyiannis, and her Montenegrin counterpart, Milan
Rocen, signed a protocol establishing diplomatic ties. Rocen was in Athens on a
one-day visit. "We are very happy to welcome Foreign Minister, Milan Rocen,
on his first official visit to Greece since Montenegro won independence,"
Bakoyiannis said. Plans for the opening of a Greek Embassy in the capital of
Podogorica should be finalised at the start of 2007. "We are happy that
Montenegro managed to gain independence by democratic means and has solved its
problems with Serbia, and is establishing good neighbourly relations,"
Bakoyiannis added. Montenegro narrowly voted for independence from its union
with Serbia in May - a time when the question of independence had deeply divided
Montenegro, with opponents arguing it would damage economic and political ties
with Serbia. "It is the first time in the Balkans that this was achieved in
such a democratic manner," Rocen said.
Montenegro's union with Serbia had been established in 2003, replacing what was
left of the former Yugoslavia.