The year 2018 indicates a period of stability and gives reasons to be optimistic in terms of the improvement of economic conditions and the business climate – according to the ninth edition of the annual MFIC White Book
By publishing the ninth edition of the White Book, the Montenegrin Foreign Investors Council (MFIC) celebrates its tenth anniversary as a non-governmental and non-profit organisation that represents the interests and expresses the opinions of its members for the promotion of shared interests and the stimulating of foreign direct investments, as well as the improvement of communication and cooperation with official bodies in Montenegro.
The White Book is a key publication produced by the Council, in which foreign investors assess the business environment on the basis of their personal perception and highlight the challenges they face in Montenegro.
The year 2018 indicates a period of stability “with a slight increase on the ease of doing business index”, which provides reason for optimism in terms of the improvement of economic conditions and the business climate. However, further attention needs to be paid to the implementation of reform processes within analysed sectors, in order to achieve better business environment conditions, attract foreign investment and create conditions for the improvement of the economic standards of all citizens of Montenegro.
The White Book presents the MFIC Index, an evaluation of the ease and effectiveness of doing business in Montenegro, based on the experiences of MFIC members. The MFIC Index for 2018 totals 6.49 on a scale of 1 to 10 (with 1 representing the lowest score). When evaluating the business environment, the ease of performing daily operations and difficulties faced by investors due to the general business climate and regulatory environment were taken into account.
The 2018 rating indicates increased stability compared to 2017, when the Index stood at 6.47, representing the highest level since the introduction of this kind of evaluation.
MFIC members rated the following sectors: telecommunications/ICT, banking/finance, tourism, production/ energy, trade/retail and transportation/ logistics.
The 2018 rating indicates increased stability compared to 2017, when the Index stood at 6.47, representing the highest level since the introduction of this kind of evaluation
The best results, as in the previous year, were recorded in the sectors of telecommunications/ICT, tourism and banking/finance (ranging from 6.78 to 6.82), while the poorest results were recorded in the sectors of production/ energy, trade/retail and transport/ logistics (ranging from 5.86 to 6.55).
It is important to note that the toprated sectors recorded a decline in 2018, and due to the increase in ratings in sectors that have been ranked low for years (production/energy, trade/retail and transport/logistics), 2018 saw the recording of the lowest overall growth of the MFIC Index.
In addition to areas that have traditionally been evaluated since 2011, such as labour market and employment, property development, taxation, corporate governance and the rule of law, the ninth edition of the White Book includes several additional categories – important areas that should be in the focus of public institutions in order to eliminate potential business barriers: the grey market and inspections, regulations on public-private partnerships, public procurement, the digitalisation of public services, regulations on personal data protection and human resources. The scores for those categories are relatively low, which should be a signal for the Government to include them among its top priorities in the period ahead, as well as to implement reforms in those areas in accordance with the best international standards and practises. On the other hand, these results show that the noted categories will be a priority for the Council in the period ahead, and both the Council and our members are ready to provide support in their development and reform processes.
The Montenegrin Foreign Investors Council will continue to monitor the activities of government bodies in an effort to ensure that the recommendations of the members of the Council are included within measures envisaged for implementation, with the aim of creating business environment conditions in Montenegro that corresponds with the level investors enjoy in developed economies. It is therefore of particular importance to continue the implementation of measures in the areas of the rule of law and the efficiency of legal protection, the improvement of economic conditions and the business climate, the improvement of infrastructure and the realisation of new infrastructure projects while maintaining stability and preserving confidence in the financial sector.