Montenegro's government could decide to liquidate its troubled flag carrier Montenegro Airlines, which is in a critical financial situation, Capital Investment Minister Mladen Bojanic said at a press conference broadcasted by public broadcaster RTCG.

The company, which has been slated for privatisation for years, is having serious financial trouble and has apparently attracted no significant international interest. No tender for its sale has been called so far. Meanwhile, the government has attempted for years to improve its financial situation.

“Montenegro Airlines has significant problems. The situation with Montenegro Airlines’ finances and with the law on its consolidation, which was adopted a year ago, has been very neglected. The agency [for protection of competition, AZK] issued a temporary solution to suspend that [state] aid and we have found ourselves in a stalemate. One part of the funds was transferred, and another was blocked,” Bojanic said.

He added that the government will try to avoid liquidation if it is able to find another solution to the problem.

The government plans to seek help from the European Commission when trying to find a solution for its flag carrier.

In September, Montenegro Airlines launched a redundancy scheme to meet the requirements of the special law for its stabilisation.

The flag carrier had annual revenue of around €70mn and was assessed by the government as a company with a major positive impact on the growth of Montenegro's economy. However, Montenegro Airlines’ unpaid taxes on personal income and social security contributions amounted to €20.46mn as of end-April, up from €19.49mn three months earlier.

In 2017, a feasibility study carried out by Deloitte and quoted by the government said that Montenegro Airlines had good financial prospects and in the mid-term should stop burdening the state budget and start contributing instead. The analysis was commissioned by the government and aimed to show whether the carrier was viable and could become stable again.