This year, the main momentum for stronger economic growth will be the investment activity along with the foreign direct investment inflow, so that there’s still an increase in the economic growth rate and GDP exceeding 3 percent.
A range of economic policy measures, especially from fiscal area, that the Government implemented last year, gave extraordinary outcomes. In an interview for Dnevne Novine daily, executive director of the marketing and consulting company ‘Intelligent Communications’, Mr Boško Kovačević, said a systematic environment for economic growth has been significantly bolstered, primarily through the elimination of crisis tax and the increase in the minimum labor wage.
He noted: “The fiscal consolidation measures provide tangible results, while the macroeconomic indicators are showing positive trends and the government is managing to control them. Such positive macroeconomic indicators greatly contribute to better collection of individual tax revenues, especially those most significant in the overall structure of budget revenues.”
In that respect, Mr Kovačević especially emphasized the growth of value added tax (VAT) revenues, but also the total tax revenues, which for the first nine months of 2019 had a surplus of about three million euro. Despite significant losses the state has been facing due to certain non-performing economic entities, an increase in VAT in this case would do more harm than good, according to him.
At the same time, GDP growth has been largely driven by the successful tourism season and it is expected that the upward trend in this sector will continue throughout 2020.
The recent completion of the first priority section of the Bar-Boljare motorway “will significantly improve aspects of the Montenegrin economy and its overall competitiveness”.
“The construction of the highway is a project of the century in Montenegro, which will have positive effects on all macroeconomic indicators of the economy, and therefore indirectly on public debt,” concluded Mr Kovačević.