In Montenegro, regulatory changes are necessary to enable the control and punishment of unregistered entities conducting business, stated Sanja Ćalasan, the Chairperson of the American Chamber of Commerce (AmCham) Board of Directors.
She highlighted that AmCham recently presented its Business Environment Report for 2023/24, which emphasized the need for an effective inspection oversight system with clearly defined measures and authority to combat the shadow economy, particularly in the tourism sector.
Additionally, she stated that tax rates should be structured to support the development of strategic sectors and continue fostering a perception of a favorable tax system for business.
One of AmCham’s recommendations is to accelerate the VAT refund process to meet international best practice standards, processing over 90% of requests within 30 days.
Ćalasan also stressed the need for Montenegro to create preconditions for paperless operations, fully implement the Electronic Document Law, and develop a regulatory framework for electromobility, inspired by examples from the EU and neighboring countries like Croatia and Slovenia. She called for additional incentives such as tax exemptions for vehicles, tolls, parking, and reduced registration fees.
She emphasized that their mission is to improve the rule of law, legal certainty, public administration efficiency, fight the shadow economy, and accelerate the digital transformation of the economy, as these factors are essential for creating a stable, transparent, and competitive business environment.
Ćalasan also noted that investors seek a secure and predictable business environment with high legal certainty, efficient administrative processes, and a market free from the shadow economy. Digitalization plays a crucial role in enabling faster, more transparent business practices and reducing bureaucratic barriers, contributing to a more efficient public administration.
AmCham’s Business Environment Report showed that the overall business environment rating, on a scale of one to ten, was 5.91, which has remained consistent over the past decade, indicating no significant improvement in the quality of the business environment. Half of AmCham members indicated that the business climate had not changed in the last two years.
AmCham members negatively assessed the state of the shadow economy in tourism, the duration of legal proceedings, bureaucratic procedures in construction and real estate, cybersecurity, and the variety of e-services in public administration, as well as the labor market challenges in attracting skilled candidates.
However, the report is viewed as an opportunity to recognize areas needing improvement and as a call for collaboration to make the business environment more competitive and efficient. Improving consultations, increasing transparency, and implementing policies that directly support the economy are seen as crucial steps.
Ćalasan highlighted that the most attractive sectors for investment in Montenegro are tourism, energy, infrastructure, particularly transportation, and IT. She emphasized that Montenegro’s NATO membership, its path toward EU membership, the use of the euro, a favorable tax system, and its strategic location make it an appealing destination for investors.
Recent statements by U.S. Ambassador Judy Rising Reinke confirmed that American investors are more interested than ever in opportunities in Montenegro, particularly in infrastructure, energy, tourism, IT, and healthcare.
Ćalasan stressed that investments in renewable energy and transportation infrastructure are particularly appealing to investors. She also pointed out that Montenegro could serve as a test market for various digital services, making the IT sector particularly attractive.
Tourism already plays a significant role in the economy, with Montenegro’s rich cultural heritage, diverse natural beauty, and strategic location making it an appealing tourist destination.
AmCham members are optimistic about the future, with 83% of companies expressing confidence in the next five years, citing digital transformation, planned infrastructure development, and global stabilization as key factors.
Regarding collaboration with the Montenegrin government, Ćalasan stated that the ongoing dialogue with the government is productive, enabling AmCham to contribute to decisions that positively impact the economy. She also emphasized the importance of early involvement of the business community in the legislative process and improving the transparency of decision-making.
Ćalasan concluded that the low participation of the private sector in the creation and amendment of regulations, especially in public consultations, signals the need for greater engagement. She also stressed the importance of involving relevant business representatives in the Regulatory Impact Analysis process to better assess the impact of planned changes on the business environment. She believes that by improving these areas, sustainable solutions can be created for the challenges facing the economy. Only through collective efforts and coordination can these challenges be addressed effectively.
