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Montenegro adjusts its budget to new circumstances
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Montenegro adjusts its budget to new circumstances
Published on: Jun 5, 2020 • 2:25 AM Author: PR Service
Podgorica, Montenegro (4 June 2020) – The Montenegrin Cabinet passed the Draft Law amending the Law on the Budget of Montenegro for 2020.
"The coronavirus pandemic is a shock to the economy of the whole world, there is practically no country whose economy does not suffer. During two months, practically the entire world economy stopped, just as the whole world makes new budgets and projections, so do we in Montenegro. What we are doing is done by almost all countries in the world - they are adjusting the budget to new circumstances," Minister of Finance Darko Radunović noted at the press conference following the Cabinet session.
Also, Minister Radunović pointed out, at the very beginning of his address, that Montenegro tackled this crisis at a time of achieved positive results in the consolidation of public finances, which is demonstrated by continuous reduction of the budget deficit through significant revenue growth in the past three years, rationalisation of consumption and creating conditions for declining public debt.
"The Montenegrin economy in previous years was characterised by positive economic trends, which resulted in significant growth of GDP," said the Minister of Finance, noting that positive trends continued in 2019 and that the Montenegrin economy grew at a rate of 3.6% in 2019, according to the preliminary data from Monstat.
Special emphasis is placed on tourism, which accounts for 22.4% of GDP in 2019 and that will show the greatest vulnerability in the current economic conditions. According to projections, it is estimated that around EUR 650 million in tourism revenues will be generated in 2020, which is around EUR 450 million less compared to the revenues generated in the previous year, and we are talking about a real decline of 40% annually.
Significant missing funds for 2020 have already been allocated through the implemented arrangement, which was supported by the Policy Based Guarantee (PBG) of the World Bank based on development policies, in the amount of EUR 250 million.
For full press release in Montenegrin, please click here.
Ministry of Finance
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