Government of Montenegro and IFAD officially begin implementation of Cluster Development and Rural Transformation Project in Montenegro

Representatives of the Government of Montenegro and the International Fund for Agricultural Development (IFAD) marked today the official launch of a joint project in Nikšić, which will support the development of agriculture and rural infrastructure in seven Montenegrin municipalities. The Project for Cluster Development and Transformation of Rural Areas in Montenegro was officially opened by Deputy Prime Minister and Minister of Agriculture and Rural Development Milutin Simović, and Director of IFAD for Middle East, North Africa, Europe and Central Asia Khalida Bouzard.

According to the agreement signed by Minister of Finance Darko Radunović and Deputy Prime Minister and Minister of Agriculture Milutin Simović on 12 May 2017 at the headquarters of the organisation in Rome, Montenegro, as IFAD member, was approved very favorable loans (restitution period of 15 year, grace period of 3 years, an interest rate of 0.69%) in the amount of about EUR 4 million and a non-refundable support of about EUR 2 million for the improvement of agricultural production and infrastructure in rural areas of Montenegro. With the anticipated contribution of the Government of Montenegro and local governments, the total value of the project is EUR 13.6 million. It is anticipated that the project will be realised in the following municipalities: Nikšić, Šavnik, Žabljak, Mojkovac, Bijelo Polje, Berane and Petnjica.

Director of IFAD for Middle East, North Africa, Europe and Central Asia Khalida Bouzar expressed the pleasure of IFAD's first project in Montenegro and thanked the Government of Montenegro and the Ministry of Agriculture for cooperation.

I've always admired the impressive strides of your country. Indeed, Montenegro has been impressively recovering from the crisis of the 1990s, the economy has been growing, and poverty has declined dramatically. However, higher growth has been noted in the coastal and central part of the country, where the growth of tourism catalysed investments, while huge number of challenges remained in the northern part of the country, Bouzard said, pointing out that the biggest challenges in the north are related to population aging, unemployment, especially youth unemployment.

In the context of these challenges, Bouzard stressed, the Government of Montenegro has made a very thoughtful contribution to the cooperation and financial support of IFAD through this project.

Simović thanked IFAD for cooperation, with the assurance that the project will be closely monitored. He said that maximum transparency would be ensured.

DPM Simović also said that the preconditions are being created for the beginning of the realisation of the IPARD programme, through which new EUR 40 million will be available for Montenegrin agriculture. He stressed that the most recent communication with the EC representatives was optimistic and that the IPARD implementation could take place by the end of September. He noted that there is intensive communication with the World Bank in order to negotiate a new MIDAS project.

The Deputy Prime Minister and Minister of Agriculture concluded that partnership with IFAD, continued partnership with the World Bank, alongside continued support from EU partners and numerous other bilateral projects, give strength for common achievements.