Montenegro’s treasury currently holds over one billion euros, Prime Minister Milojko Spajić announced, adding that none of the borrowed funds will be used for consumption.
“We will regularly issue bonds. We launched with an interest rate of 4.8%, which is a fantastic result,” Spajić stated during the Prime Minister’s Hour in the Parliament.
He emphasized that the funds will be used solely for repaying old loans and partly for capital investments.
“In the treasury, along with the funds we have, there is over one billion euros in liquidity. This will not be used for consumption, salaries, pensions, or social benefits, as we have a surplus in the current budget,” Spajić said in response to a question from a member of the Democratic Party of Socialists (DPS), Nikola Milović.
Milović had asked if the data on economic activity at the end of last year and the first two months could be seen as the government’s public acknowledgment that the populist-consumption-driven economic model has failed.
Spajić reiterated that no borrowed money would go toward consumption.
“Interest payments are part of current expenditure, not part of loan repayments. We must finally become financially literate. Interest is part of the current budget, and when we cover current expenses with income, meaning we have a surplus, we reduce debt relative to GDP,” Spajić explained.
He pointed out that when he became minister, net debt as a percentage of GDP was nearly 90%.
“Net debt has now dropped to just over 50%. In addition, over the past four years, we have maintained a fiscal deficit averaging below 3%. Now, we are preparing not just to enter the EU, but also the eurozone. We will be essentially ready for entry into the eurozone, which is a significant achievement and an indication of our economy’s readiness for the larger European challenge,” Spajić added.
He also noted that when he first became minister, GDP was 4.2 billion euros, and it has now nearly doubled.
