Montenegro and European Union

The Balkan Networking Initiative had its official inaugural conference in Budva on 22 May 2011. The Balkan Networking Initiative is a project of the government of Montenegro and Atlas Group. The goal of the conference is to establish a public-private networks and create sustainable social empowerment through cross-border networking.

The conference welcome addresses were given by Montenegrin Prime Minister Igor Luksic and Atlas Group President Dusko Knezevic, while former U.S. President Bill Clinton had the keynote address. The event includes following prominent panellists:
Milo Djukanovic, Former Prime Minister, Montenegro, Stjepan Mesic, Former President, Croatia, Milan Kucan, Former President, Slovenia, H.E. Petar Stoyanov, Former President, Bulgaria, Mr. Bálint Magyar, Former Minister of Education, Hungary, Mr. Thomas Barrett, Director, European Investment Bank (EIB), Professor Dragan Lajovic, Faculty of Economics, University of Montenegro, and Mr. Muhamed Mike Tarhini, Vice-Chairman, Abu Dhabi Capital Group. While giving a keynote welcoming speech, former U.S. President Bill Clinton mistakenly praised Macedonia for having the beautiful breath-taking nature, and for progress made on its way towards Euro-Atlantic integrations.

As reported – Most of the conference is closed to the media — which is not considered a good practice in this era of government transparency. Transparency is the best protection against corruption. As the saying goes, “light kills germs.” This is particularly important in joint public-private initiatives, which are often simply methods for politicians to funnel taxpayer money to their friends in business. Public-private initiatives must be monitored closely and publicly to ensure that they are in the public interest — this is a valuable function of the free press.

Prime Minister Luksic met with Bill Clinton

Budva, Montenegro (22 May 2011) – Prime Minister Igor Luksic met Bill Clinton, 42nd US President and founder of the William J. Clinton Foundation in his first visit to Montenegro where he was a keynote speaker at the Inaugural Conference Balkan Networking for Social Empowerment of South-Eastern Europe organised by the Atlas Foundation and the Government of Montenegro.

Montenegrin Prime Minister and former U.S. President discussed economic and political situation in Montenegro as well as foreign policy priorities. President Clinton expressed great pleasure to stay in Montenegro, in his words a country of great potential and natural beauty. He congratulated Prime Minister Luksic on Montenegro’s receiving the EU candidate status, as well as on its celebrating five years since restoring independence. “Montenegro is a success story and is on the right track to achieving set goals,” said Mr Clinton.

Mr Clinton said he has no doubts as to Montenegro’s success in all areas, underlining that Montenegro’s progress should serve as an incentive for the region as a whole. He affirmed his support to Montenegro’s efforts by saying that he would be very glad to pledge his wholehearted support to Montenegro, a country of great potential, in its efforts to attract foreign direct investment. Towards the end of the meeting, President Clinton invited Prime Minister Luksic to be a guest of the Clinton Global Initiative ahead of the General Assembly annual session in New York.

Other Montenegro-EU news:

(17 May, 2011) – European parliamentarians officially visited Podgorica and met with Prime Minister Igor Luksic. During discussion about EU integration emphasize was made on Montenegro’s role, which could be of great importance for the entire region. Montenegro could be the next success story in the Western Balkans and thus be an “incentive to the EU member-states to continue supporting the enlargement policy” and also to the region to “remain persistent in its EU aspirations.”

MEPs concluded that Montenegro is “on the right track to meeting European recommendations,” and underlined their firm support to Montenegro to continue with its efforts.

PM Luksic stated that “Consensus on EU integration unites the whole of Montenegrin society.” and that “the Government will continue its efforts on completing activities arising from the Action Plan with the view to opening accession negotiations soon.”

European Commission Economic Forecast for Montenegro

The European Commission (EC) Directorate-General for Economic and Financial Affairs has released it’s European Economic Forecast for Spring 2011 with a mixed forecast for Montenegro.

Positive Points from 2010:

  • Real economic expansion close to 1%
  • 19% increase in exported goods
  • 16% increase in exported services
  • 13% increase in the construction industries
  • Trade gap decreased by 4% of GDP
  • Current account deficit decreased by 5% of GDP
  • Net FDI increase
  • Very mild inflation
  • Disposable income rose 2.9%
  • The main negative point from 2010 was that unemployment remains above 19%.

    The report is subtitled “A recovery driven by external demand …” The EC predicts that the Montenegrin economy will gain momentum in 2011 largely from export growth. While the EC may see that as a potential negative, it is the correct solution for Montenegro at this time. The EC would like to see a recovery fueled by domestic consumption, aided by an increase in domestic consumer lending. This presupposes that Montenegrin’s can spend themselves into prosperity — a very questionable proposition.

    The EC believes that Foreign Direct Investment (FDI) inflows into Montenegro will be “rather high” in 2011, but worries that there are not enough large infrastructure projects. FDI is one of the critical factors for economic growth, but a large number of small projects is generally more stable and positive than a small number of large projects.

    The EC predicts that rising global prices will lead to inflation in Montenegro, but that this will be offset by the rising wages which result from economic growth.

    The EC believes that Montenegrin government debt will be brought under control in 2011 and begin to decrease. This will be due in part to reduced government spending and in part to revenue increases which result from economic growth.

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