Business

24 Oct 2019, 14:16 PM
October 24, 2019 - Transport Minister Osman Nurkovic said that there was great interest in granting concessions for the right to use the Podgorica and Tivat airports and that the pre-qualification procedure would last 45 days, with the possibility of an extension of another month at the request of the concessionaire. On the other hand, the leading aviation analyst in the region, Alen Šćuric, warns that Montenegro must be very cautious when it comes to concessions over airports so that the Slovenian scenario does not happen.
 
Nurkovic explained that potential bidders are expected to pay the state at least EUR 100 million in advance, and at least 10 percent of annual revenue from the airports' exploitation. They have to invest a minimum of EUR 80 million in the first three years of at least 200 million investments for the duration of the 30 years' concession period. 
 
In the first part of his analysis of "Did Montenegro Learn from the Slovenian Fiasco?" published yesterday on Belgrade's Tangosix portal, Alen Šćuric pointed out that Montenegrin aviation has all the predispositions to be a success story that will bring great benefit to Montenegro. "Slovenia also had predispositions, everything seemed fairy-tale, and today, due to catastrophic moves by the authorities, it was brought to a total aviation collapse. Will Montenegro learn from the Slovenian example?"
 
The Slovenian government has given both of its airports a concession. The deal with German Fraport in Ljubljana does not go as planned and announced, while the leasing of the Maribor airport to the Chinese consortium turned into a real traffic and financial disaster when the concessionaire withdrew from the contract, realizing almost none of its obligations.
 
"The results of the Airport of Montenegro are truly fascinating. Therefore, Montenegro is not desperate; it does not have to give its airports a concession at any cost. Finally, the current profit and growth trend of the same shows that in the next 30 years, Montenegro will have a financial benefit of 500-700 million euros from the airport. However, if Montenegro chooses to give its two airports a concession, then it is necessary to look for a greater benefit than this," Šćuric said.
 
Source: Dan and Boka News
 
24 Oct 2019, 14:03 PM

24 October 2019 - According to the new World Bank Report - Doing Business 2020, Montenegro took 50th place on the list of 190 countries ranked using the “ ease of doing business ” criteria. Compared to last year's Report, Montenegro increased its rating for 1.07 points (from 72.73 to 73.8) and maintained the same rank.

Doing Business 2020 is the 17th in a series of annual studies investigating the regulations that enhance business activity and those that constrain it. Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 190 economies— from Afghanistan to Zimbabwe—and over time.

The report covers indicators affecting 12 areas of the life of a business: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency, employing workers, and contracting with the government. The indicators are used to analyse economic outcomes and identify what reforms of business regulation have worked, where, and why. Data in Doing Business 2020 are current as of May 1, 2019.

Montenegro Ranks 50th on WBs Ease of Doing Business 2020 List 2

In terms of Montenegro’s ranking, the most significant progress was made in the area of building permits, where Montenegro improved 35 places in the rankings in this area, now reaching the 40th place on the ease of getting a building permit list. In comparison to last year, according to the methodology used by the World Bank, Montenegro significantly reduced the cost and time required to obtain a building permit.  Such progress is a confirmation that the World Bank recognizes continuous efforts that Montenegro makes in the area of getting building permits, and above all, the effort to establish a new legal framework in this area, which was achieved in 2017.

Montenegro’s progress has also been evident in the area of cross – border trade. This indicator treats the procedures for import and export. Montenegro has improved six places in the ranking by reducing the time and costs required for import and the costs of export.

In the area of obtaining connections for electricity, Montenegro reduced the necessary time and costs, but the rank remained unchanged.

For other indicators, there was no change in the ratings compared to last year, and corrections in the rank are the result of the intensive reform processes implemented by other countries.

Read more about the business environment in Montenegro at TMN's dedicated page.

23 Oct 2019, 13:45 PM

Traders largely respected the legal norm on introducing non-working Sundays, as a total of three violators, that is, two companies and one entrepreneur, were found in the entire territory of Montenegro within 24 hours, the Inspection Directorate announced.

On Sunday, the Market Inspectorate conducted an inspection to enforce the agreed obligation under the Internal Trade Act that wholesale and retail trade cannot work on Sundays.

“In all three cases, the inspectors charged the company for a fine of EUR 1,000 and a responsible person in the company EUR 200 for the offense committed. For the two companies, the total amount of the fine was 2.4 thousand euros," the statement said.

The entrepreneur was fined 300 euros.

"In addition to the fine for the offense, the inspectors in all three cases closed the shops for the period during which the work was not allowed," the Administration said.

The supervision, they recalled, included all wholesale and retail facilities in all municipalities.

"The surveillance was organized throughout the day and began in the early hours of the night, that is, from Saturday to Sunday, from midnight and lasted 24 hours," the statement said.

All market inspectors were engaged in this supervision, who visited all the shops located on the terrain where they were in charge of.

"The work of the duty inspector was organized at the headquarters of the Market Inspectorate in Podgorica, which received phone reports and answered the citizens' questions during the day," the Administration said.

In Montenegro, October 20th was the first non-working Sunday for employees in the trade sector.

On Sundays and public holidays, the wholesale and retail trade may be carried out in pharmacies, specialty shops or kiosks for the sale of bread, bakery products and cakes, flowers, souvenirs, press, plant protection products or funeral equipment, gas stations and retail stores within the gas stations.

Wholesale and retail trade can also be carried out at green markets, stands - counters, showcases and vending machines outside the markets and mobile shops, kiosks and vending machines located within closed areas of bus and train stations, airports and ports, stands and kiosks which sell goods during events, festivals and manifestations, fairs and during the public display of cinematographic works, as well as warehouses for the wholesale trade.

Specialty shops or kiosks are considered to be shops or kiosks where the sale of mainly one type of goods is carried out.

Text by MINA Business on October 22nd, 2019, read more at Vijesti

22 Oct 2019, 20:59 PM

22 October 2019 - The Gvozd wind farm will be of even better quality than Krnovo, due to its great energy potential as the wind speed reaches 17 meters per second in that area. This wind farm will produce electricity enough to meet the needs of 25.000 households, said Krešimir Čondić, CEO of Austria’s IVICOM Holding GmbH.

Renewable energy resources, as strategic commitment of the Electric Power Company of Montenegro and the Gvozd wind farm project, were considered today in the meeting of the Committee on Energy and Mining.

Only one part of the wind potential of the Krnovo plateau has been used in the construction of the Krnovo wind farm.

Gvozd wind farm is expected to have 54,6 MW and to produce approximately 150 kWh of electricity.

The beginning of the construction is the spring of 2021. Works are expected to take 18 months and the wind farm is expected to become fully operational in autumn of 2022. This investment is worth around 60 million EUR, reports Cafe del Montenegro.

Individual wind generators will have 4230/4430 KW of nominal power.

The future wind farm will require the construction of infrastructure, reconstruction of the existing roads and construction of new ones, with the aim of connecting certain wind aggregates.

"Gvozd will be of great quality, even higher than Krnovo," said Čondić.

Director of the sector of Electricity transmission Jagoš Pupović said that they were considering variants for the optimal solution for connecting Krnovo to the energy system.

Head of development and engineering at Electric Power Company of Montenegro Ivan Mrvaljević acquainted members of the Committee with the renewable energy resources to be valued through some modernization projects and ecological reconstructions. He added that the modernization of hydropower plants represented a very important project. Reconstruction of the oldest plant "Perućica" will increase its installed power by 58,5 MW.

Read more news about business in Montenegro at TMN's dedicated page.

22 Oct 2019, 14:05 PM

Growth in production and increased product placement were realized during the tourist season, which is a result of better connectivity between hoteliers and domestic food producers, the Chamber of Agriculture and Food Industry (PKCG) board announced.

Committee secretary Lidija Rmus, who presented information on economic trends, said that the increase in production and increased product placement in the tourist season was partly the result of the realization of the projects Buy Domestic and Domestic Tastes.

"The tourist offer increasingly includes the traditional gastronomic offer of Montenegro when presenting our country," Rmus said.

During the first eight months of this year, the purchase and sale of agricultural, forestry and fishery products amounted to EUR 23.4 million, and is at the same level as last year. By August, 16.1 million liters of milk were purchased, 3.4 percent less, but the production of all milk products increased, which has a positive effect on the financial results of this sector.

According to Monstat, PKCG said food production increased 4.6 percent in eight months and 8.9 percent in beverages.

During the session, it was assessed that the biggest problem faced by the agrarian was the lack of competitiveness of the product. That is why the goal of food producers is to increase the volume of production and the competitiveness of products, which can enable better placement of domestic products, and the business barriers they face in business need to be removed.

Speaking about the investments in agriculture that were completed in the current year, Rmus said that the company “Nase voce” (Our Fruits) has established an apple plantation on 15 hectares in Zupa - Niksic, and plans to build a five-hectare cherry plantation and new apple plantations on an area of 15 ha, as well as the construction of a juice production facility.

"This production will have a significant impact on the substitution of apple imports," Rmus added.

The processing plant with a capacity of about 60 thousand hams (prosciutto) is being built in the company Zrnozit, the construction of a new slaughterhouse in Mesopromet, and a meat processing plant is in the final stage.

She stated that it is significant that the water factory Bjelasica Rada started production again, and in Savnik, within the company, Eko-per Diva, started a new bottling plant. A new 600-ton cold-storage in Plantaze has been put into operation.

In the first eight months, imports of agri-food products amounted to EUR 391 million, with exports amounting to EUR 28.2 million, so the export-import ratio was 7.2 percent. Imports grew by 6.4 percent from the same period last year, and exports are down six percent.

Committee Chairman Milutin Djuranovic said that the drop in the coverage of imports by exports is worrying, because it is not insignificant, so in the coming period, we must work on strengthening the competitiveness even more.

Board member Amela Visnjic from Visnjic Commerce pointed to the problem of extremely high imports of eggs sold as domestic, which creates problems for business people.

Boris Covic from Bonesa advocated greater investment in technology because it is an expensive product and stressed the need to reduce and even eliminate protectionism in all industries.

Nikola Milosevic from Eko-per Diva believes that they need to be more active in selling domestic water in shops and hotels.

"We have to fight for at least 50 percent of the water in the shops to be domestic, which would increase our production by 20 percent," Milosevic said.

He added that 70 percent of imported water is now being sold in stores, and only 30 percent is domestic.

In order to eliminate the constraints that entrepreneurs face in business, it is necessary to work on the amendment of several normative acts that regulate their business. These are laws on companies, labor, excise duties, value-added tax, debt collection, and fiscalisation.

At the session, it was assessed that the implementation of the national campaign for the purchase of domestic products should be continued with the aim of raising consumer awareness and creating an environment for better positioning of Montenegrin products, which will directly contribute to the reduction of imports.

Also, when designing the Agrobudget, through the subsidies, the dairy sector, which faces very strong competition from the region, should be preserved and the quality control of imported products strengthened.

The session announced that IPARD funds are intended to strengthen the capacity of the agricultural sector, make it competitive and comply with EU rules, standards and practices.

General Director of the Directorate for Rural Development, Darko Konjevic, said that during the past year, two public tenders had been issued from IPARD for investments in agricultural holdings and processing capacities, which are underway.

“Through the first IPARD to support farms, by the end of July, 221 contracts worth EUR 13.5 million were signed. Twenty contracts worth 11.9 million were signed in the processing. The realization of investments in processing capacities will open about 80 new and provide security of placements for about seven thousand subcontractors," Konjevic reminded.

At the beginning of September of the current year, a second public invitation from IPARD for investments in processing capacities was launched.

“There is now a new € 15.6 million grant available to domestic processors to support investments to improve production. The sectors of processing of milk, meat, fruits and vegetables, olives, fish and aquaculture, as well as wine production, will be supported," Konjevic added.

The public invitation is open until November 4th. Konjevic announced that this deadline would be extended due to the interest of the businessmen and that at the end of this year, a second public invitation for investment in agriculture would be issued.

Konjevic also announced that another invitation for processing would be issued in the coming year.

Text by MINA Business on October 21st, 2019, read more at Vijesti

22 Oct 2019, 14:02 PM

Cetinje is the recipient of the Globallocal Award, which is given to the best local communities to create a good environment for entrepreneurship development in Central and Southeastern Europe.

The capital of Cetinje has been informed that the award was presented to the Mayor Aleksander Kascelan at the World Entrepreneurs' Congress, which is being held in Skoplje for the second time.

Kascelan said it was a pleasure to be among the best, especially when prominent experts recognized efforts to develop the local community in the field of entrepreneurship development.

"The reward is coming at the right time. We expect the announcement of the advertisement for the lease of the real estate of the former Obod, an advertisement for tenants of the Business Center is in progress, we are contacted by numerous investors, and in the capital budget we have planned money for the purchase of land on which the famous Lokanda hotel was situated, whose redevelopment, in addition to new hotel and catering facilities, will generate new employment," said Kascelan.

In addition to the capital Cetinje, 14 cities from the region were awarded in this category.

The award was made by an independent International Committee on Globallocal Awards and Recognition, made up of 18 distinguished experts in economics, marketing, commerce, management, finance and entrepreneurship, from nine Central and Southeast European countries.

Text by MINA Business on October 18th, 2019, read more at Vijesti

19 Oct 2019, 13:00 PM

19 October 2019 - At its recent session, the Assembly Committee on Economy, Finances and Budget supported the Proposal for the Law on Amendments to the Law on Road Traffic. A representative of the Ministry of Transport and Maritime Affairs Dalibor Milošević said that this Proposal stipulated all the documentation drivers should have in their vehicle, including Tax Return proof.

"Until now, the driver was obliged to have only an employment contract. Now, drivers are obliged to have tax return in the vehicle, as a proof of regular payment of contributions," said Milošević.

Field analyses have shown that there is a great number of drivers with fictitious contracts, registered to work 10 or 15 hours a day.

"We are trying to protect a driver as an employee and create a clear picture of the exact number of drivers reported to work in a company. Some companies have 100 registered vehicles and only 50 registered employees," said Milošević.

Member of the Committee Raško Konjević asked why a taxi driver was obliged to have a tax return in his vehicle.

"Will a taxi driver be excluded from traffic in case he has not got his tax return in the car? What happens if I have to go to the airport but I can not because I am not allowed to be in traffic? The problem lies in the fact that we are the only capital in Europe with the catastrophic organization of road traffic," pointed out Konjević.

The session discussed debts of taxi drivers, amounting to over 3 million EUR, writes CdM.

"Taxi drivers owe more than 3 million EUR in taxes," said the president of the Committee Predrag Sekulić.

Member of the Committee Boris Mugoša pointed out that inspection supervision in road traffic should be enhanced.

"We only have three road traffic inspectors in Montenegro. That is alarming," concluded Mugoša,

Read more news about business in Montenegro at TMN's dedicated page.

18 Oct 2019, 13:59 PM

The Municipality Tivat responded yesterday to the text, "The job was given to the most expensive contractor, construction is late".

“The construction of the roundabout in Kukuljina will start according to plan, that is, according to the Decision on the best offer, number: 1902-404-42 / 12 dated 02.10.2019, because there are no legal obstacles to act differently. Pursuant to the Law on Public Procurement and the Instructions to Tenderers, which is an integral part of the Tender Documents, the Tenderer's complaints are filed through the first-instance body, in this case, the Contracting Authority - Municipality, therefore the statement in the text that the company from Kotor filed a complaint for the tender No. 1902-404-42 dated 27.08.2019 is false. The appeal deadline expired on October 15.

The claims about the method of ranking and selection of the most favorable bidder are also not true, whose publication creates the wrong image of the work by the Public Procurement Commission of the Municipality.

We emphasize that the expert commission has thoroughly inspected the tender documentation, noted irregularities, and made a decision in accordance with the submitted offers and evidence, which are an integral part of the same, and all in accordance with the Law on Public Procurement and the Instructions to Bidders. We believe that the transmission of falsehoods is inappropriate to the media, and we ask that you publish full information as soon as possible to be truthful to the public,” states the response.

Text by Vijesti online, on October 18th, 2019, read more at Vijesti

18 Oct 2019, 13:52 PM

The construction of a part of the road from Cetinje to Cevo will cost about 34.5 million, which is 2.5 million euros less than was intended for this work.

Up to 37 million euros was allocated for the 23 kilometers of the section from Cetinje to Cevo.

That section is only part of the road that is to connect Cetinje and Niksic.

“The construction of this road will be of great importance for the inhabitants of this area, but it will give additional quality and impetus for the development of both Cetinje and Niksic. Improving the road and overall infrastructure is a priority of the Government as it is a key prerequisite for more dynamic development and, therefore, a better quality of life for citizens,” said the Prime Minister Dusko Markovic earlier.

The Traffic Administration has selected “Briv construction” from the four road construction companies that submitted the offers.

At this job, the company from Kotor will be assisted by "Profil ing" from Bar, "Mining-Mont" from Pljevlja, "Montinspekt" and "Geo mac group" from Podgorica.

According to the decision available on the Public Procurement Portal, the first subcontractor should participate in this business with less than 14 percent in the part of the works on the route and connecting roads, the second with a little more than seven percent with the mining plan and mining works, the third with 0.18 percent in the part related to public lighting works, and fourth with 0.22 percent in the job of geodetic survey.
The tender documentation stipulates that this section of the road should be completed in three years and that the warranty period is five years from the handover of works.

Out of the other three bids received, Podgorica's Bemax was ranked second, Niksic's “Mehanizacije i programata” was third-ranked, while the only inaccurate bid was, according to the decision, was Tivat's "Sampetrol".

The offer of the ranked Bemax was 36.8 million euro, or 2.4 million euro more expensive than “Briv”.

Tender documentation also required the type of funds and equipment needed for this job. The earthworks section required a lifting drill, excavator, bulldozer, grader, loader, soil compactor and vibrating plate, asphalt paver, asphalt roller, asphalt cutter and emulsion sprayer, and truck, auto mixer and auto crane.

The most favorable bidder is obliged to conclude a professional liability insurance contract for damage that may occur to the Management Board and/or third parties from the beginning of the execution until the handing over of the works and to submit a copy of the insurance policy to the contracting authority, before concluding the contract.

“The sum of insurance cannot be less than 2,000,000 euros; This insurance must cover the risk of liability for damage caused by individuals, damage to buildings and financial loss," the tender documents stipulate.

It is further stated that the Administration is obliged to ask the tenderer whose tender was selected as the most favorable one, and who refuses to conclude a public procurement contract, a compensation of the damage in the amount of 10 percent of the offered tender amount.

If the contractor does not, by its own fault, complete the works on this section within the agreed deadline, they shall pay the Management Board on behalf of the agreed penalty one per mile from the agreed price of all works for each day of exceeding the deadline, provided that it cannot exceed five percent of the agreed price of works.

Payments will be made through advance, interim monthly valuations and the final certificate.

Text by Milos Rudovic, on October 17th, 2019, read more at Vijesti

17 Oct 2019, 18:47 PM

17 October 2019 - Minister of Science Sanja Damjanović took part in the main panel discussion of the INNOVEIT conference in Budapest, which the European Institute of Innovation and Technology (EIT) organises every year and also gave its annual award for innovation in one of the categories.

EIT innovation model is designed to efficiently transform the European innovation environment in a way that solves market and system deficiencies by linking all the actors in the field of innovation, regardless of which disciplines and sectors they are related to, to work together. Through the next EU programme (Horizon Europe 2021 – 2027), this institute will have an increased budget and one of its focus will be the expansion of the regional impact, including the Western Balkans countries.

In a panel discussion about the education and the regional dimension as the basic pillars of the future of this unique institute, Minister Damjanović stated that the EIT is a powerful driver of innovation in Europe.

"Our young people, representatives of the business sector and start-ups participated in EIT schools, competitions and manifestations, which significantly affected their way of thinking and working," Minister Damjanović pointed out, hopeful that the European Commission's Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR) will find a way to support the development of innovation centres of this institute in the Western Balkan countries. Referring to the long experience of researches and outstanding cooperation with CERN, Minister Damjanović highlighted that the EIT as a networked institute, that is, CERN as the infrastructure, are examples of how entrepreneurship and academic community can work together and spread the culture of innovation and business.

"It is exciting to see how advances in robotics, chemistry and food science, energy and ICT, data science and artificial intelligence, mechanical engineering contribute to the significant innovations the nominated innovators have developed in the EIT Venture Award category," Minister Damjanovic noted, writes Ministry, emphasising that she comes from a small country in the Western Balkans, which has just started implementing innovation policies and developing and linking its innovation ecosystem, and that Montenegro finds great inspiration in seeing how society functions and changes for the better. 

The EIT Venture award was given to the finalists whose team has been developing a unique technology that converts wave energy efficiently and sustainably. Minister Damjanović also congratulated the innovators in other categories and the EIT communities, who, by supporting such innovators, make Europe, a true innovation union.

Read more news about business in Montenegro at TMN's dedicated page.

16 Oct 2019, 19:13 PM

16 October 2019 - A consortium of the German company WPD AG and the company Vjetroelektrana Budva (Budva Wind Power Plant) is the only bidder for the construction of the Wind Farm Brajići, reports Vijesti daily.

Tender documentation for the construction of wind farms on state-owned land in the municipalities of Budva and Bar was purchased by five companies, including a consortium that applied for the public call, which closed on Friday, two companies from Finland and one each from Belgium and China.

According to the data gathered by Vijesti daily, the German-Montenegrin consortium has offered an investment of 100 million EUR for the construction of wind a farm with the potential of producing 100.8 megawatts (MW). For the lease of 220.77 thousand square meters of state land, the company offered 2.5 EUR per square meter.

The tender required a minimum price of an annual lease of five cents per square meter. The government issues the state land for 30 years. Data on planned electricity production are expected. The offer also envisages the participation of domestic companies with 21.6 million EUR.

The Tender Commission has a deadline of 45 days, i.e., until the end of November, to verify whether the bidder meets all the requirements.

The representatives of the Montenegrin Ministry of Economy recently explained that this project would be implemented according to market principles, which means that there are no financial incentives for the state for the guaranteed purchase price.

German WPD AG has experience in the implementation of projects of this type in many countries, with a portfolio of installed capacity of 4.4 thousand MW.

WPD AG is a developer and operator of wind farms both onshore and offshore, acting worldwide. Since 1996, WPD has installed 2,200 wind turbines with a total of 4,450 MW. Currently, more than 1,500 MW are held as assets. Internationally, WPD is planning projects in the scope of 8,725 MW onshore and 7,250 MW offshore. For years, WPD has been awarded the first-class “A” rating by the Euler Hermes agency (Allianz Group).

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