Podgorica, November 4, 2010—The Doing Business 2011 survey demonstrates that Montenegro is keeping pace with, if not leading, reform efforts in a region focused on improving its business climate. Montenegro’s results exceed those of three EU member countries (Poland, Italy, and Greece) as well as most countries in the region, including Croatia and Serbia. This annual survey of altogether 183 countries, conducted by the World Bank Group, is generally motivated by broader empirical findings that dynamic economic activities require good rules; as such, the Doing Business survey tries to provide guidance to countries for prioritizing their reform efforts in this area.
For Montenegro, the Doing Business 2011 survey has confirmed continued progress in improving the business and investment climate, noting the successful implementation of reforms surrounding (i) the establishment of a business, by replacing several procedures for business start-up by a single registration form for submission to the tax department; (ii) cross-border trade, by eliminating the requirement to present a terminal handling receipt for exports and imports; and (iii) the payment of taxes, by removing the obligation for advance payments and abolishing the construction land charge. Montenegro has clearly established itself within the top third of countries worldwide in the critical areas of protecting investors, getting credit, cross-border trade, as well as starting and closing a business.
This year’s overall Doing Business ranking is based on nine indicators with equal weight. Compared to previous reports, the “employing workers” indicator (for which Montenegro would have recorded a substantial improvement) has been removed from the national score cards and the overall ranking. To make this year’s ranking comparable with last year’s, the published rankings for the Doing Business 2010 had to be re-calculated. The drop from the 66th to 65th rank, as based on the revised methodology, is equivalent to what would have been recorded as an improvement from the 71st to 67th rank if the previous methodology were kept.
The findings in this year’s Doing Business imply the need for a continued focus on reform efforts in the areas of construction permits, tax payment procedures, contract enforcement, and property registration. To this end, the government is working with the World Bank (for instance, through its Land Administration and Management Project) and the International Finance Corporation (IFC) on removing remaining obstacles for investments and private-sector activities.