Montenegro's Fiscal Crisis Looms as Euro Model Adoption Imperils Competitiveness

Montenegro is facing significant challenges in terms of climate, energy, and fiscal risks, warns Professor Branko Radulović. He believes that adopting the Euro model could further weaken the state's ability to bear these pressures.

The current level of pensions would require a minimum of 860 million euros per year from the budget if contributions to the Pension and Disability Insurance Fund (PIO) were completely abolished, which is expected under the new Euro model. Radulović points out that this amount is already being compensated for by general budget revenues, indicating a significant deficit.

He emphasizes that the issue of the Euro model is not just about short-term fiscal mathematics but also has long-term consequences, including inflation and an increase in public debt, VAT, and other taxes. Radulović believes this would make Montenegro increasingly uncompetitive as an investment destination and vulnerable to environmental pressures.