SSICG: Must Accelerate Pace for Reforms and Intensify Fiscal Policy

By , 30 Mar 2018, 14:43 PM Business
From the Conference From the Conference Council of Foreign Investors in Montenegro

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The overall business environment in Montenegro is constantly improving, however, the pace for reforms in the ruling Law, cooperative management and infrastructure, as well as strengthening the fiscal policy, must be accelerated, said the Council of foreign investors (SSICG).

The executive director of SSICG, Marija Sukovic, said that 2016 was marked by a period of stability with a slight increase of the business easiness index.

“The index for 2016 was 6,35 and for the last year 6,47. The result for 2016 shows stability, especially in comparison with 2013 and 2014 and a slight increase concerning 2015, when the index was 6,2”, said Sukovic at the press conference presenting the SSICG White book.

The index for last year is the highest one since this kind of evaluation has been carried out.

The publication, with its eight issuances, represents the Council’s principal document in which the foreign investors, based on their perception, estimated the business environment and pointed out the main challenges they face in Montenegro.

“The result shows that the foreign investors consider the overall business environment is constantly improving and that the reforms initiated in the last period have produced reasonable results”, said Sukovic.

On the other hand, as she stated, serious reforms need to be implemented if Montenegro wants to be an attractive investment destination, especially to investors who would bring, with their knowledge and practice, financial and all other benefits as well.

“The domains such as the ruling Law, cooperative management, and infrastructure need to be developed, while the competitiveness in the private sector needs to be improved and strengthened with the fiscal policy”, said Sukovic.

According to her, the pace of reforms and improvement need to be accelerated to achieve the anticipated results.

“Montenegro constantly improves the business environment, but the starting point is quite low, so that’s why the country is still ranked among the middle positions with significant space for improvement”, stated Sukovic.

The data show that telecommunication and informatics-communication technologies (ICT) departments have the highest grade among the sectors; the bank system indicates almost the same results as in 2016 and in the last year while tourism has the most stable class.

“The production department shows lower results, trade and a slight retail increase while transport and logistics a significant drop, and it added Sukovic.

The members who represent the ICT department in the Council gave lower grades than the rest of the Council members which means that those companies consider that there is more space for improvement.

“The banking system the grade for 2016 was higher and lower in the last year while the tourism representatives marked their sector with the higher grade than all the other members of the Council”, said Sukovic.

Regarding the ruling Law, the low grade demonstrates that this sector can be a barrier to the development of the business environment in Montenegro.

“The new individual categories, i.e. the areas which were implemented and represented the potential barriers in business are regulations on public-private partnership, public tenders, digitalization of public services, the grey market and inspections, regulations on protection of personal data and human capital”, specified Sukovic.

The suggestion by SSICG is that these areas become priorities and that the Government should deal with the same in the current year.

The President of the Council and Board of directors SSICG, Christoph Schoen, said that 2016 and last year were periods of stability with the increase of the basic index.

“There is a reason to feel optimistic in the domain of economic development and successful implementation of fundamental reforms. The encouraging environment and macroeconomic indicators form a solid foundation for accelerating the reforms”, said Schoen.

He stated that the Council is concerned with the present Draft of the Law on labor, because they think it will expand the competitive gap and will be in opposition with the Government’s initiatives to intensify the economy in the country.

“We all agree that we need additional foreign investments in Montenegro and at levels of all interested parties there is a common agreement regarding this issue”, said Schoen.

The foreign investors, as he specified, are contemplating the ruling Law, revenue policies and Law on labor. Therefore, a flexible Law on labor which sustains a healthy and fair competition among the employees and enables digital transformation in a long-term mode is the Law which creates new job positions.

The member of the Council’s Board of directors, Pal Kovacs, said that the investors realized that the Ministry of Finance had achieved good results regarding fiscal consolidation.

“We need further improvements in the domain of tax payments, as well as additional investments in the human capital”, said Kovacs.

According to him, ICT department is a leading force in the economic growth, it stimulates productivity and competitiveness for economy.

“Our ICT Committee is active from 2014 and has prepared the development strategy for this domain until 2020”, stated Kovacs.

He estimated that the protection of electronic communication is also significant, and there is even an adequate regulatory outline which should enable appropriate protection of this kind of infrastructure in practice.

“Still, we had a case which caused a serious problem to one of the national operators for mobile and land-line telephone services which could happen to others as well”, concluded Kovacs.

Text by Mina Business, on March 28th 2018, read more at Vijesti

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