This week at the Montenegro Stock Exchange (Montenegroberza) was marked by a drop in indices and a rise in trading volumes, coinciding with the government’s approval of the Draft Budget Law for the upcoming year and a decision on borrowing.
The value indicator for the ten largest companies on the exchange, MNSE10, fell by 1.1% to 1,077.43 points, and the MONEX index also dropped by 1.1% to 16,217.95 points.
Trading volume for the week, which was shortened by two working days due to the observance of Njegoš Day, amounted to €85.48 thousand, 1.5 times higher than the previous week.
Stock losses were recorded by Plantaže, which dropped 5.3% to €0.18, and Crnogorski Telekom, which declined by 1.8% to €2.15.
Plantaže announced significant progress in its business results for the first nine months of the year, despite challenges in the industry and its operations. While the net result remained negative, the company’s operating result was the best in recent years, strengthening the management’s efforts and confirming the company’s strategic direction.
EBITDA (earnings before interest, tax, depreciation and amortization) was positive at €2.8 million, indicating the effectiveness of the company’s operational efficiency measures. Revenues for the first nine months of the year were the highest in the last decade, with a 6% increase compared to the previous year. Sales of bottled products across all markets rose by 11%.
On the other hand, stocks that saw gains this week included Poliex, which rose by 44% to €0.253, and Jugopetrol, which slightly increased to €13.84.
Shares of Hipotekarna Banka, Sveti Stefan Hotels and Zetatrans were also traded, closing at €95, €5.5, and €1.09, respectively. Luka Bar shares ended the week at €0.251, while Port of Adria closed at €0.20.
Shares of the Trend Fund were traded without change, remaining at €0.045.
In other news, the Montenegrin government approved the Draft Budget Law for 2025 and a decision on borrowing, with a projected surplus in current budget expenditures. This means the country will borrow only to repay old debts and finance capital projects.
The Ministry of Finance reported that total revenues are projected to reach €2.88 billion, a 3.7% increase compared to this year’s plan, while expenditures are set at €3.16 billion.
The budget forecast includes a deficit of €278 million, or 3.5% of GDP, in line with the fiscal strategy. Key measures outlined in the budget aim to improve citizens’ standards through the “Europe Now 2” program, including raising the minimum wage to €600 and €800, increasing salaries for all employees to achieve an average wage of €1,000, and boosting minimum and average pensions. The program also includes higher allowances for professional training and student loans.
The government has provided room to borrow up to €2.3 billion, with €884 million allocated for covering the deficit, capital projects, and repaying past debts, and €1.13 billion for project loans and major investments. An additional €275 million will come from the EU, through the Western Balkans Growth Plan, for reforms and infrastructure projects.
The state budget will face a shortfall of €1.13 billion next year to cover all obligations, with €884 million expected to be raised through loans. The remaining funds will come from the state’s reserves, including €240 million carried over from this year’s budget, €6 million from asset sales, and nearly €10 million in loan repayments.
The week also saw the release of economic forecasts by the European Commission, which confirmed that Montenegro’s economic growth continued but slowed in the first half of the year, driven by private consumption and the recovery of investments.
The recently adopted “Europe Now 2” program aims to increase disposable income by raising the minimum wage and cutting pension contributions. These measures are expected to support GDP growth next year but may also lead to higher inflation, according to the European Commission’s forecasts.
The Commission also noted that the strong fiscal performance this year was supported by significant revenue growth, but new measures that weaken budget revenues and increase spending could lead to a substantial increase in the budget deficit in 2025-2026. The rise in public debt and high refinancing needs present fiscal risks.
Real GDP growth for last year was revised upward to 6.3%, compared to a previous estimate of 6%. The economy slowed to 3.6% year-on-year growth in the first half of this year, driven by a recovery in investments (up 9.6%) and strong private consumption (up 8.2%), supported by higher minimum pensions, salaries and employment.
