This report covers the main macroeconomic releases from August 5 until September 4 as well as the financial and political events that took place in Montenegro during this period.
The vice governor of the country’s central bank, Nikola Fabris said the GDP will grow just 2.0% this year, affected by several negative factors such as the Russia-Ukraine crisis and the mid-May devastating floods in Serbia and Bosnia, among the others. The forecast is considerably lower than the central bank's latest official estimate for 3.2-3.8% growth.
The country’s current account gap widened 5.6% y/y in the first half of 2014 due to the rising trade gap and the falling surplus in primary and secondary income accounts. The net inflow of foreign direct investments to Montenegro climbed 5.5% y/y to EUR 163.7mn in H1 2014, which equals 4.1% of the full-year GDP forecast.
In the period reviewed by the report, the country placed two issues of 182-day T-bills, selling a total of EUR 48.5mn.
The report also contains information about the opening of the first Regent hotel in Montenegro, which is only the second hotel operated by Regent Hotels and Resorts in Europe. It also informs about the initiative of Several Balkan states to scrap roaming fees as of January 2015. The report provides details as well for the failed sale of bauxite mining firm Rudnici Bokcita’s assets.
Key points:
• CPI dropped 1.21% y/y in July, steeper than the 0.1% y/y decrease in June. Retail sales rose for the fifth consecutive month, going up by a real 5.3% y/y in July following a 4.8% annual growth in the previous month.
• Industrial output dropped 16.5% y/y in July, softening from a 26.4% annual contraction the month before.
• The unemployment rate measured by the number of registered unemployed rose to 13.46% in early September from 13.42% a month earlier. In addition, the average net monthly wages swung to a nominal 0.2% annual growth in July, totalling EUR 470.
• The number of foreign tourists visiting Montenegro swung to a 1.2% annul drop in July from 1.3% hike on the year in June as the total arrivals also went down 1.3% y/y.