Economic analyst Davor Dokić stated that only a quality investment cycle can reduce Montenegro’s public debt, alongside necessary economic policies and a reduction in public sector employment.
He expressed confidence that debt repayments over the next five to six years will be covered primarily through new borrowing, mainly on international markets.
According to the Ministry of Finance, public debt stood at 4.2 billion euros at the end of March, representing 53.15 percent of GDP. Dokić questioned the accuracy of these figures, suggesting the actual debt-to-GDP ratio might be higher due to inflated GDP estimates.
He highlighted structural issues in the economy, noting the high number of public sector employees and the need for investments to improve economic conditions. Dokić criticized the government’s economic policy management as unsatisfactory.
The Ministry of Finance analysis shows Montenegro owes over 4 billion euros to foreign creditors, while domestic debt, including municipal liabilities, amounts to 321 million euros.
Debt repayments include 750 million euros due in 2027 from a 2020 bond issuance and 500 million euros due in 2029 from a 2019 issuance. Dokić believes new borrowing will be necessary to meet these obligations.
He warned that Montenegro risks entering a cycle of refinancing old debt with new debt, perpetuating a debt spiral.
The Ministry’s analysis did not account for an 850 million euro bond issuance, which was used to repay 500 million euros of old debt from 2018.
