Montenegro’s tourism sector is facing a significant decline, transitioning from a thriving industry to a real estate business. Experts argue that urgent reforms are needed to address the issues threatening the future of tourism, which is considered a key national interest for the country.
During a press conference held by the NOVA STEGA movement, experts criticized the government’s policies, particularly the increase in VAT on accommodation, which they claim is detrimental to tourism. Vladimir Nikaljević, an economist with Stega, argued that the Minister of Tourism is more focused on political interests than on improving the tourism sector. He also criticized the government’s shift towards construction and real estate development, particularly in cities like Budva, where the focus has shifted away from tourism.
Professor Rade Ratković, also from Stega, called for a comprehensive overhaul of the tourism sector, emphasizing that businesses cannot succeed without adequate support in destination management. He pointed out that Montenegro’s current tourism infrastructure is unsustainable, with an overwhelming proportion of accommodation in complementary sectors (90%) rather than primary tourism facilities (10%).
Experts also noted that Montenegro has struggled to attract investment due to political instability, with many investors perceiving the country as an unreliable destination. Additionally, the country’s tourism market has been underperforming for decades, consistently operating at a loss, except for a brief period in 2019. The lack of a strong, competitive tourism sector has also contributed to significant labor shortages.
Ratković stressed the need for a shift towards a more sustainable and profitable tourism model, with a focus on improving the structure of accommodation and prioritizing hotels, resorts and eco-tourism. He also called for residential properties to be excluded from the tourism sector and integrated into a real estate strategy.
The experts concluded that the government must implement fundamental reforms across the entire tourism sector, or risk further erosion of Montenegro’s tourism industry. They emphasized that revitalizing tourism is essential for the country’s economic health and that these reforms should be considered a top national priority.
