PMR Research is a specialised custom market research unit of PMR Ltd., a British-American company based in Poland. We offer a wide range of research services in Central and Eastern Europe for companies interested in business over the countries in the region.

Research services provided by PMR Research in Montenegro include:

• brand and company image studies
• research on customer preferences, their satisfaction and their purchasing habits
• product concept tests
• usage & attitude studies
• internet surveys
• quantitative surveys - telephone, CATI, face-to-face
• qualitative research - focus groups, IDIs
• industry analyses (comprehensive analyses of given market sectors performed using PMR's proprietary methodology PMR MarketInsight)
• preparation of databases
• fieldwork services

Why to invest?

Introduced Euro as a currency EU accession process has started Increasing country stability Stable GDP growth rate Skilled labour Lowest corporate tax in Europe – 9%

Business and economical environment

The smallest of the countries created after the demise of ex-Yugoslavia, Montenegro offers unique opportunities, especially in tourism, but also agriculture, energy, banking and the metals industry. Despite the fact that the EU accession process has only recently started the currency in Montenegro is the unilaterally introduced Euro which increases investment stability. Additionally, businesses operating in the country benefit from skilled labour, relatively low employment costs and the lowest corporate tax in Europe of just 9%. However, for such a young country, the key task for the government over the coming years is to introduce modern, free market management rules, curbing the shadow economy and also reducing the involvement of organised crime in the economy. Last, but not least, it must be mentioned that in Montenegro, a Limited liability company might be started in just four days and with a minimum capital of one Euro.

The Gross Domestic Product growth in Montenegro has reached 7.1% on average annually in the period from 2005 to 2008 (when the GDP has increased by 7.5%). However, the forecasts for coming years are less positive with economy shrinking by 2.7% in 2009 and 1.95% in 2010. This will be a result of the global slowdown influence on the Montenegro as the tourist industry will be hit and demand for country exports is expected to be much lower. The country also has no advantage of possibility to debase local currency against Euro and lower costs of imports from Montenegro.

The inflation rate recorded in Montenegro has reached the level of 3.52% in 2007 just to increase in the following year to 8.99%. However, the forecast for 2009 assumes a drop of the two percentage points to 1.65% as the economy will cool down in result of the global economy crisis.
 
Unemployment, just like in the many other countries of the Balkans is still very high and reached 16.5% in 2007. Values forecasted for 2008 and 2009 show an increase, however, of just 0.5 percentage point per annum resulting in values of 17% and 17.5% for the mentioned years respectively.

Value of the goods and services imported into Montenegro in 2007 has reached EUR 2bn while flow of goods of services out of the country was valued at EUR 0.66bn. Foreign direct investment attracted in 2007 into Montenegro was estimated at the level of EUR 1.01bn.

Most attractive sectors:

• Tourism
• Agriculture
• Energy
• Banking
• Metal industry
• Food industry

The country converted its official currency to the Euro in 2002, despite not yet being a member of the EU.
 

Social environment

The population of the Montenegro as of 2008 has amounted to 0.6m inhabitants making it the smallest of the ex-Yugoslavia member republics and also one of the smallest nations in Europe. In terms of nationalities the major groups are: Montenegrin 43%, Serbian 32%, Bosniak 8%, Albanian 5%, other (Muslims, Croats, Roma) 12%. While education is concerned Montenegro has only two universities and a few schools providing tertiary education. Montenegrins declare affiliation with the following religious groups Orthodox 74.2%, Muslim 17.7%, Catholic 3.5%, other 0.6%, unspecified 3%, atheist 1%. In terms of salaries paid in the country their average value was recorded at EUR 609 in 2008.

According to the Transparency International study Montenegro is one of the Europe’s most corruption affected countries. The CPI (Corruption Perception Index) reflecting how the country society perceives strength of the phenomenon has reached 3.4 in 2008 and country was ranked as 85th globally. Despite lower rank than year ago the value of the index has increased slightly from 3.3 in 2007.
 

Infrastructure and technological environment

Montenegro research and development infrastructure is very limited and in this field the country lags behind other ex-Yugoslavia countries that faced more industrial development like Slovenia, Croatia and Serbia. Despite the fact that Montenegro is a small country we expect some infrastructure to emerge with further investments.

Montenegro is highly dependent in terms on imported sources of energy. The country supplies of all gas and a third of electricity are sourced abroad. However, the country is in possession of significant energy generation potential in terms of hydropower that could be installed on rivers Piva and Zeta. Current capacity in terms of electricity production installed in the area is 859 MW out of which hydropower creates 76% and 24% is available in a single coal powered plant. In terms of fossil fuel deposits in the area are found coal low in sulphate and ashes, lignite as well as oil and gas which deposits are known in the country. It must be emphasized that in such situation of high dependence on foreign supplies the government plans to add additional 700 MW in capacity at the cost of EUR 836bn till 2025.

What is interesting Montenegro has the highest mobile phone penetration in Europe with 1.31m users making the penetration ration 211%. Simultaneously the internet penetration exceeds 30%.
Montenegro rail transport network consists of 250 km of track out of which 68% are electrified. Major road network consists of 1,729 km of paved roads of which none is a motorway. However, due to highly mountainous terrain a big number of engineering structures exists.
 

Political environment

Montenegro is a parliamentary republic. The parliament (National Assembly) consists of one member per each 6,000 voters (currently 78 MPs) and is elected every four years. The head of state is a President elected every five years. Prime Minister is elected by the National Assembly. The next parliamentary elections are scheduled for 2010 while the presidential vote will take place in 2013.

Montenegro is not a member of the European Union, however, has access to the pre-accession funds that will fuel its development and in future ease gaining full membership status.

Since 2007 Montenegro enjoys a free trade with CEFTA countries (Albania, Bosnia and Herzegovina, Croatia, Serbia, Macedonia, Moldova and Kosovo) as well as with Russia since 2000. Majority of the Montenegro products are also admitted without quotas or custom fees to the EU (agricultural products, “baby beef” products and textile products).


The country is a member of all the major international organisations but WTO.
 

General data

Area: 14,026 sq km
Population: 0.6m (2008)
Capital city: Podgorica
Language: Montenegrin (official) 22%, Serbian 63.6%, Bosnian 5.5%, Albanian 5.3%
Ethnic groups: Montenegrin 43%, Serbian 32%, Bosniak 8%, Albanian 5%, other (Muslims, Croats, Roma (Gypsy)) 12%.
Land boundaries: Albania 172 km, Bosnia and Herzegovina 225 km, Croatia 25 km, Kosovo 79 km, Serbia 124 km

Major economic indicators

	2006	2007	2008	2009f	2010f
GDP (EUR bn)	2.15	2.81	3.29	3.28	3.25
Population (mn)	0.6	0.6	0.6	0.6	0.6
GDP per capita (EUR)	3,582	4,683	5,487	5,470	5,413
GDP (constant prices y-o-y %)	8.6	10.7	7.5	-2.7	-1.95
Exports, real, y-o-y (%)	40	37
Imports, real, y-o-y (%)	32	55
CPI (average, y-o-y %)	2.12	3.52	8.99	1.65	-0.2
Monthly wage, nominal (EUR)	397	497	609
Unemployment rate (%)	14.7	16.5	17.0	17.5
Net FDI (EUR bn)	0.5	0.52
FDI % GDP	23	18.5
Exchange rate to USD AVG	0.7964	0.7345	0.6827
Exchange rate to EUR AVG	1	1	1	1	1

Last update: Q2 2009
 

Useful data

Currency: EUR (adopted unilaterally)
Time zone: GMT +1
Area code: +382


If you would like to find out more on the Macedonian market opportunities please do not hesitate to contact us directly:
phone: (48 12) 618 90 80
faks (48 12) 618 90 08
e-mail: [email protected]

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Montenegro market research
PMR Research offers a full array of qualitative and quantitative research methodologies, providing services such as customer satisfaction studies, brand awareness and brand image research, distribution and competition studies, segmentation and sector analyses.

Montenegro consulting
PMR Consulting offers a wide range of consulting services in Central and Eastern Europe for foreign companies interested in the region. The typical projects include: competitive intelligence, sourcing, strategic advisory, consulting at foreign direct investments and mergers & acquisitions.