The transformation of Tivat from a dormant seaside town, based on seafaring, shipbuilding and military, in the "elite nautical-touristic destination of the high class" for the last ten years, resulted in dramatic economic and demographic changes, but it did not give the expected results in improving the standards of the domicile population.
This, among other things, can be concluded from the analytical part of the Tivat Strategic Development Plan for 2019-2022, which will soon be found in front of the councilors in the parliament. According to the latest 2011 Census, Tivat had 14,031 inhabitants, with an average age of 38 years. In the last decade, the town recorded a continuous increase in the number of inhabitants who were 12,812 in 2000, five years later 13,404, and reaching 14,744 people last year. The natural increase in Tivat is 6.7 percent, which is drastically higher than the Montenegrin average of 1.9 percent.
"The data show a steady increase, as well as a higher percentage of population growth than at the state level. The population growth is due to the positive natural increase and positive migration trends of the population within Montenegro," the Strategic Plan says, with the note that Tivat has 4,862 households and two times as many condos - 9,675.
The smallest municipality in Boka since the closure of the military shipyard Arsenal, the eviction of military assets with which Tivat has been living with as a base for more than 120 years, according to the local and state DPS officials, has been transformed into the "Montenegrin Monte Carlo" thanks to the development of yachting and elite tourist complexes Porto Montenegro and Lustica Bay.
Construction is continuously ongoing PHOTO: Siniša Luković
However, these projects are basically primarily real estate because they are dominantly reduced to the construction of apartments, villas and business premises for sale or rent, while the construction of new classical hotel capacities is considerably smaller in the development of these complexes, especially in the case of Porto Montenegro. This luxurious complex, built on the site of the former Arsenal, "pulled the trigger" to a new development trend in Tivat, which with the construction of apartments under the mask of "development of tourist villas and condo hotels" becomes an overbuilt “elite Budva”. At the same time, the population is more and more "convicted on a cloth and a broom", that is, relatively poorly paid and hard jobs in the service industry for rich clients of elite complexes, or wealthy people who can afford expensive houses built on the unexpected coast or its green hinterland.
The development and arrangement of the town are at the same time concentrated mainly on the center and the closest contact zone of the elite Porto Montenegro, while the surrounding, and especially peripheral settlements, are literally neglected, and some of them today look like a Brazilian favela.
Center of the town PHOTO: Siniša Luković
"Arsenal's privatization in 2006 also caused significant economic and demographic changes in our municipality. This, among other things, led to a faster development of the specific town’s center, while at the same time we can freely say there is slower, or not so rapid, development of peripheral areas. Also, significant disruption to the whole coastal region is also reflected in the discharges of the population from the northern region to the primal coastal region. As a result of this, we have, inter alia, coastal areas that take urban features and become areas of concentration of population with a predominantly tourist function," said the Strategic Plan. On several occasions, the document mentions the growing migration of the population from the north and the arrival of an increasing number of people to Tivat in search of a better life. The economic branch that is experiencing the boom in Tivat, as well as on the whole coast, is the construction of apartments in the last decade. From 2003 to 2011, the number of apartments increased by as much as 2,549 (from 7,167 to 9,626). Of the newly built apartments, 1,382 are empty and uninhabited, and only 509 apartments are officially seasonally used. This shows that the criticisms of those who at the beginning of the Porto Montenegro project warned that this could be turned into raising "settlements with closed blinds" - were justified. And in the middle of summer, most of the apartments in Porto Montenegro, Lustica Bay, and similar complexes are with closed window blinds and in the dark, testifying that they are rarely used.
Porto Montenegro PHOTO: Siniša Luković
Around these complexes, there are more and more newly built residential buildings with striking inscriptions - "For sale" and contact info of the sellers - investors. In spite of this, the construction boom does not stop and, according to the current data of the Urban Planning Department in Tivat, more than 80 construction sites are now active. The authors of the Strategic Plan say that from 2012 to 2017 in Tivat, the number of available permanent jobs has increased by about 1,000, given the very pronounced seasonal fluctuations in the number of jobs available only during the summer.
"In addition to the fact that the season lasts for three months and does not represent a long-term source of income for employees, the most frequent jobs in the field of tourism and catering, construction and trade do not provide high incomes. Also, the workforce from the neighboring countries (Serbia and Bosnia and Herzegovina) is most often engaged in the above mentioned jobs. Economic growth and employment from 2012-2017 had a limited impact on the number of unemployed... In the mentioned period, oscillations in the number of unemployed at the end of the year were recorded. The smallest number of unemployed persons were recorded in 2015 (740 unemployed), after which in the next two years there was an increase in the number of unemployed persons," the Strategic Plan reads.
That the new concept of economic development of Tivat does not give the expected economic effects on the domicile population, shows that at the Bureau of work in 2014 there were 807 citizens of Tivat, and last year only slightly less - 784. The unemployment rate is constantly one of the highest on the coast and it is moving between 13 and 14 percent.
"In the period up to 2014, the number of employees has grown steadily, so that in the coming years there will be a reduced number of employment. These movements are caused by the mere reduction of the absorption power of the market, that is, employment opportunities."
It is noted that in some economic areas, such as tourism and trade, there is the possibility of additional employment, but that "conditions offered are not accepted by the local workers".
Apart from the fact that it does not represent a long-term source of income for employees, these jobs do not usually provide high revenues. In order to create better jobs, it is necessary to devise measures for the development of a sector that provides employment throughout the year and measures for the development of year-round tourism that would require the engagement of the workforce out of season."
Three times higher incomes per capita than the average in Montenegro
The authors of the Strategic Plan praised the achievement, claiming that "the permanent improvement of the business environment contributed to the Municipality of Tivat attracting large investors who started the realization of investments such as Porto Montenegro, Lustica Bay, and Blue Horizons.
Luštica PHOTO: Siniša Luković
"The launch of these investments, especially the opening of Porto Montenegro in 2009 as one of the largest marinas in Europe, has contributed to increasing the attractiveness of the Municipality of Tivat and Montenegro as a whole as investment and tourist destinations. The investment boom in the Tivat Municipality is one of the most important drivers of socio-economic development. Investments in Tivat and real sector growth have contributed to improving the fiscal sustainability of the municipality in the last five years. Viewed per capita, current budget revenues increased by a third, so from 540 euros in 2009 they increased to around 730 euros in 2014, which is three times more than the average in all the municipalities in Montenegro in 2014, which are amounted to 260 euros per capita, according to the data by the Government of Montenegro.
There are no big companies, service activities are in boost
Tivta's economy, meanwhile, has lost all of its former large companies, such as Arsenal, and today it consists of micro, small and medium-sized enterprises with the dominant share of the two least categories of as many as 99.25 percent of all economic entities. The number of active enterprises rose from 715 in 2012 to 1,166 in 2016, but more than three-quarters of them deal only with the tertiary, i.e. service activities (trade, accommodation and food services, real estate brokerage, agency activities).
The number of four star category hotels has been increased, the number of the lowest categories has been reduced - two stars, and four new five-star hotels have been opened with a total of 380 beds. Tourist traffic, measured by the number of guests and realized overnight stays, increased more than doubled in the period 2014-18.
Text by Sinisa Lukovic, on November 4th, 2018, read more at Vijesti