Report by the WTO Secretariat

Since its WTO accession in April 2012, Montenegro’s small and open import-dependent and servicesorientated economy has been on a fluctuating growth path. Action has been taken through fiscal consolidation and reform measures to address several economic challenges. During the review period, Montenegro’s annual GDP growth ranged from -2.7% (in 2012) to 3.5% (in 2013); its annual average growth rate for the period 2012-16 stood at 1.8%, a slowdown compared to 3.4% over the 2001-11 period. Following a fiscal loosening in 2016, reforms have been under way to spur economic recovery, including a Fiscal Consolidation Plan (December 2016), a Fiscal Consolidation Strategy (June 2017), and a 2017-2019 Economic Reform Programme. Developments in Montenegro’s regional and international competitiveness were affected by productivity-related and other challenges, some of which are being addressed. Whereas consumer price inflation dropped from a peak of 4.1% in 2012 to 1.5% in 2015, including two years of deflation, and averaged 1.4% in the period 2012-2016, the unemployment rate declined progressively but remained relatively high at an average of 18.5%.