Montenegro’s research and development expenditure is 0.3% of GDP, while the European Innovation Scoreboard puts its performance at 44.7% of the EU average. The figures highlight a gap between the country’s policy ambition and resources for research, technology and commercial innovation as it seeks to narrow its productivity gap with the European Union.
The Science and Technology Park has expanded cross-sector cooperation and filled 86% of its planned positions by the end of 2025. Innovation Fund financing rose from 700,000 euros in 2022 to 3.2 million euros in 2024. New innovation programmes include initiatives focused on artificial intelligence and GovTech.
A new tax incentive allows profits reinvested in approved research and development or innovation projects to generate a corporate income-tax credit equivalent to 100% of the tax due. The measure is intended to bring more private-sector capital into activities that have traditionally relied on small public programmes.
The business base presents a challenge for scaling innovation: services employ roughly three quarters of Montenegro’s workers, while micro-sized businesses make up the overwhelming majority of companies. An innovation system dominated by grants measured in millions of euros is unlikely, by itself, to transform the economy.
Montenegro’s accession to the European Union is expected to improve access to research networks, Horizon Europe partnerships and larger markets. Domestic firms will need the capacity to use those opportunities.
Innovation policy will become economically meaningful when higher research and development spending is linked to export services, energy technology, tourism technology and industrial niches, and when companies can scale beyond the domestic market.
