Montenegro’s construction industry recorded stronger activity in the second quarter of 2026 as residential development and an expanding programme of public infrastructure works increased the volume of projects underway.
The value of completed construction works rose by approximately 6.3% year on year in Q2 and by 6.5% compared with the first quarter, indicating increased activity across the sector. Several investment streams are developing at the same time. Residential construction continues to receive support from high property prices and growing mortgage lending, while tourism projects are generating demand for hotels and mixed-use developments.
Public investment is adding another source of construction activity through motorway, railway, public-building and municipal infrastructure projects. The combination is increasing demand for contractor capacity across multiple segments of the construction industry.
One of the largest projects is the next section of the Bar–Boljare motorway, with the Mateševo–Andrijevica contract valued at approximately €694 million. Railway investment is also expanding. This includes the Bar–Golubovci modernisation programme, whose value is approximately €176 million.
Public-sector construction demand is further supported by the national capital budget, which provides for €305 million in planned capital expenditure in 2026 across a broad portfolio of projects. Construction demand therefore extends across a range of activities rather than being concentrated in one major project. Contractors are involved in civil engineering, tunnelling, bridge construction, road and railway works, electrical installations, public buildings, residential projects and tourism developments.
The sector faces constraints in delivering this volume of work. Montenegro has a relatively small domestic labour market and a limited pool of large contractors with the capacity to undertake technically demanding infrastructure projects. Major developments consequently depend substantially on international contractors, imported equipment and foreign labour. This creates opportunities for domestic subcontractors while also increasing the sector’s exposure to external costs. The expanding construction programme is becoming an important channel for public investment to feed into Montenegro’s medium-term economic growth. The implementation of the larger capital programme will require projects to be delivered on schedule and within budget while limiting increases in construction costs.
