In 2025, Montenegro’s total foreign trade in goods reached approximately €5.03 billion, marking a 7.2 percent increase compared to the previous year. This growth indicates an expansion in nominal trade activity, although the underlying structure remains concerning as imports have outpaced exports, leading to a widening trade deficit that is increasingly reliant on tourism revenues, remittances, and capital inflows for financing.
Imports increased by about 9.3 percent to roughly €4.46 billion, while exports experienced a decline of around 7 percent to approximately €572 million. Consequently, the export-to-import coverage ratio fell to about 12.8 percent from approximately 15.1 percent in 2024, demonstrating a deterioration in self-sufficiency regarding goods trade.
For context, in 2024, Montenegro’s total goods trade was nearly €4.7 billion, with imports at approximately €4.08 billion and exports around €616 million. The trends observed in 2025 highlight a combination of heightened domestic demand for imports and underperformance in exports, particularly in sectors dependent on electricity generation and regional market conditions.
This trade imbalance directly impacts the balance of payments. Montenegro typically faces a substantial goods deficit that is partially counterbalanced by a surplus in services, predominantly from tourism, alongside secondary income inflows. However, tourism is seasonal and vulnerable to external factors, while the import expenditure remains persistent, driven by vehicles, machinery, consumer goods, construction materials, and energy-related products. As the goods deficit expands, the economy’s external stability increasingly hinges on the performance of each tourist season and the availability of external financing.
Looking ahead to 2026–2027, potential trade scenarios are framed around three key variables: domestic demand driven by tourism, performance of electricity exports, and fluctuations in investment/import cycles related to vehicles and construction materials. The following scenarios—Base, Upside, and Stress—illustrate possible trajectories for trade based on these factors.
In the Base scenario, Montenegro’s trade volume is expected to continue rising moderately. Imports would grow faster than exports but at a reduced pace compared to 2025. This scenario anticipates normal tourism seasons through 2026 and 2027, sustained household consumption levels, and a stable investment pipeline that maintains demand for imported machinery and vehicles without accelerating sharply. Under this trajectory, total goods trade could expand by approximately 4–7 percent annually, reaching between €5.2 billion and €5.4 billion in 2026 and between €5.4 billion and €5.8 billion in 2027. Imports are projected to remain dominant at around €4.6 billion to €4.8 billion in 2026 and between €4.8 billion and €5.2 billion in 2027; exports may stabilize modestly between €0.58 billion and €0.65 billion if electricity exports normalize alongside stable regional demand.
The Upside scenario suggests improved export performance through enhanced electricity exports and favorable regional energy pricing conditions alongside modest gains in niche product categories during 2026–2027. This scenario relies on better hydrological conditions and fewer constraints affecting cross-border electricity sales while assuming that import growth remains contained due to normalized domestic demand post strong cycles. Total trade could still rise with an improved composition; exports might recover towards €0.70 billion to €0.85 billion by 2027 while imports could increase more slowly within the range of €4.7 billion to €5.0 billion. The coverage ratio could improve to between 14 percent and 17 percent but would still be considered structurally low.
The Stress scenario forecasts continued strong import growth with stagnant or declining exports, driven by higher energy import requirements, elevated consumer imports, and significant investment-related import demands—while electricity export performance may falter due to unfavorable hydrological conditions or regional market constraints. A negative tourism season could exacerbate this situation as tourism receipts influence import demand patterns and fiscal behaviors. In this case, total trade might increase rapidly but worsen the existing imbalance; imports could approach between €4.9 billion and €5.3 billion in 2026 with potential figures of €5.2 billion to €5.7 billion in 2027 while exports remain static around €0.50 billion to €0.60 billion.
All scenarios consistently highlight structural challenges. Montenegro’s export base remains narrow while its imports reflect a consumption-oriented economy with limited domestic production capabilities for capital goods and many consumer categories. Therefore, medium-term improvements hinge on either sustained strength in electricity exports or gradual diversification into higher-value niche exports—neither of which can be assumed as stable baselines.
For policymakers and investors monitoring developments during 2026–2027, it is crucial to observe not only the overall trade volume but also the relationship between import trends and services surplus dynamics. Strong performance from tourism receipts can help finance a significant goods deficit without immediate strain; however, if tourism falters or if imports escalate due to infrastructure demands or consumer behavior shifts, then the goods deficit may become a pressing macroeconomic constraint.
The current economic framework necessitates careful attention as Montenegro navigates its widening trade imbalance observed in 2025 while considering the implications for future economic stability through the potential scenarios outlined for the coming years.
