In order to continuously improve activities and support the development of entrepreneurship and
business in Montenegro and the needs of the economy itself, the Ministry of Economy in 2019created a new program named – Program for Improving the Competitiveness of the Economy. The new program, which consolidates the existing efforts for the development of entrepreneurship and business sector, is aligned with the Economic Reform Program for the period 2019-2021 and the Development Directions of Montenegro 2018-2021. The total budget allocated for the implementation of the Program for 2019 is € 1,640 million, while the individual amounts, as well as the manner and dynamics of the allocation of support are defined by the individual program lines.

The program consists of 10 program lines, and includes activities and measures for realization of financial and non-financial support to potential and existing entrepreneurs, micro, small, medium and large enterprises, as well as clusters. The goal is to increase their competitiveness on the national and international market, to improve development and business performance, modernization of the industry, development of innovative potentials, affirmation of entrepreneurship and crafts, and implementation of international standards in the field of product improvement, business processes, methods, techniques, management strategies and marketing.

1. Program line for stimulating direct investments:

This program regulates the conditions and method of stimulating development by attracting direct investments into the production or service sectors3
, criteria for allocating funds and the payment
dynamics, as well as other issues of importance for increasing competitiveness and development of
Montenegro through the inflow of direct investment.
The funds to incentivize investments are allocated following a public announcement4
(deadline for
submission of applications is September 30, 2019 until 3pm). Eligible investment projects include
those of minimum worth of €250.000, which generate at least 8 new jobs over the course of three
years from the date of signing the agreement on the use of funds (in the Capital City and the southern
region), or those worth at least €100,000, which generate at least 4 new jobs (in the northern and
central region, excluding the Capital City). The incentives range from €3,000 to €10,000 per new
job. The funds allocated for the promotion of investment will be paid to the beneficiary after the
conclusion of a use of funds agreement, in three equal instalments (grants).
In addition, any capital investment in excess of €10 million and generating at least 70 new jobs
is eligible for incentives of up to 17% of its worth. The program line also envisages the possibility
to reimburse the costs of construction of the infrastructure required to implement the investment
project. Foreign investors will become eligible to access the funds if they set up a company in

2. Decree on Business zones development project

The business zone is a unique entity in the area of local self-government, partly or fully equipped
with infrastructure, which, in addition to the common space and infrastructure, provides potential
investors with additional tax and administrative facilities from the state and local levels (https://www.
. The municipalities Bijelo Polje and Mojkovac have establishment business
zones (in accordance with the new Decree): ‘’Nedakusi’’, ‘’Cerovo’’, ‘’Vraneška dolina’’, ‘’Bistrička dolina’’,
‘’Rakonje-Ravna Rijeka’’, ‘’Ribarevine-Poda’’ in Bijelo Polje and Business Zone named ‘’Babića Polje’’
in Mojkovac municipality. Two additional municipalities, Šavnik and Berane, expressed interest in
establishing and registering the Business Zone.

5 At its session held on November 17, 2016, the Government of Montenegro adopted a Regulation on Business Zones, which defines the model of classification, establishment, management of business zones, facilities for users, in order to attract
new investments, increase employment especially in less developed areas of the country and overcoming regional differences.
In June 2018, the Decree on the Regulation on Business Zones was adopted (15.06.2018), which amended only the deadline for
harmonization with the Regulation (the deadline for existing business zones to adjust business is extended from 6 months to 18 months).
6 The costs of accreditation activities for conformity assessment bodies are subject to refund only if the company has been awarded an accreditation certificate by the Accreditation Body of Montenegro or has performed a supervisory review of an already-granted certificate.

3. Program line for cluster development

A comprehensive legislative, strategic and institutional approach to SME development
it is a precondition for strengthening the competitiveness of Montenegrin companies and insurance
fairer regional development. The formation of clusters is of special importance for the larger one
competitiveness of entrepreneurs, micro, small and medium enterprises (MSMEs). Intensified
entrepreneurship and competitiveness as a result of cluster creation contribute more
employment, substitution of imports, increase of domestic production and exports, better business
environment, more balanced regional development and more efficient use of natural resources
resources and production capacity.
The goal of this program line is to provide financial support to entrepreneurs and
MSME in private ownership in clusters through investment in tangible or intangible assets or operating costs,
in order to strengthen their capacities and their positioning on the local and international market.
This financial support scheme is based on the reimbursement of a certain share of costs. Because clusters
mostly formed as non-governmental organizations, with the additional possibility
established as an enterprise, the program line specifically defines the requirements for both of these forms.
The total budget for the implementation of the Cluster Development Program line in 2019 is
€ 150,000.00. Support intensity: Approved assistance from the Ministry of Economy is up to 50%, ie
up to 65% of the total eligible costs, in accordance with the Project Proposal, in the amount of up to
15,000 EUR (excluding VAT), per project. Funds will be allocated through an open public call for
a standing invitation model with an application deadline of 2 September
2019 until 3 p.m.

4. Program line for introducing international standards

The program is being implemented under the principle of reimbursement and aims to provide
financial support to entrepreneurs, small and medium-sized enterprises, particularly from the
less developed municipalities and the northern region, so as to increase their competitiveness as
much as possible, primarily through compliance with the requirements of international standards
for products and support for accreditation for conformity assessment. The program includes two
support components:
• Component I – Accreditation of the conformity assessment body (refund of up to 70% of the
eligible costs of accreditation of those companies-bodies accredited6
for the conformity assessment for the ISO / IEC 17020, ISO / IEC 17025, ISO / IEC 17029, ISO / IEC 17021-1, ISO / IEC
17024, ISO / IEC 17043, CEN / TS 15675, EN ISO 15189).
• Component II – Arranging business in accordance with the requirements of international business
standards (refund of up to 70% or up to 60% of the eligible costs for standard implementation,
certification and certification of MEST EN ISO 9001: 2016, MEST ISO 45001: 2018; MEST EN ISO
14001: 2016; MEST ISO / IEC 20000-1: 2017; MEST EN ISO 18513: 2009; MEST ISO / TR 21102: 2018;
MEST ISO / IEC 27001: 2014; MEST ISO 50001: 2018).
The total budget for the implementation of the Program line for the introduction of international
standards is 140,000.00 €. Assistance approved by the Ministry of Economy amounts to up to 70%
of eligible costs for small enterprises, and up to 60% of eligible costs for medium-sized enterprises,
in the amount of up to €5,000 (excluding VAT) per applicant. The remaining amount of 30% or 40%
of the total investment is financed by the applicant independently. The public call is conducted as
an open procedure according to the model of a permanent Call with the deadline for submission of
applications by September 30, 2019 until 03:00pm. 

5. Program line for modernization of the manufacturing (processing) industry

In order to eliminate the main obstacles to the development of competitiveness of Montenegrin
companies, such as outdated equipment, low flexibility and productivity of manufacture, as
well as the unsatisfactory quality level of production systems, the Government of Montenegro is
implementing the Modernization of Processing Industry Support Program (
The main objective is to strengthen the competitiveness of economic operators, improve business
operations, productivity and profitability through investment into technical equipment of production
capacities (investment in equipment). The funds committed under the program are intended to cofinance part of the costs of equipment purchase for companies in the field of processing industry,
such as: new production equipment/machinery; used manufacturing equipment/machinery (not
older than five years); new parts and specialized tools that will be used to put unused machines into
The program involves co-financing of the eligible costs of equipment purchase up to 20% (cannot
be less than €5,000 or more than €20,000) for entrepreneurs, micro and small enterprises, and up
to 10% for medium-sized enterprises7
. If the total costs of equipment procurement are in excess of
€100,000, the beneficiary can either finance the difference through own participation or increase
the loan application with the Investment Development Fund by that amount.
The total budget for realization of the Program line for the modernization of the processing industry
is 150.000,00 €. The Ministry of Economy announced the Public Call for participation in the Program
line for the modernization of the processing industry which contains basic information, conditions for
filing the application, the place of filing and other relevant information. The public call is conducted
as an open procedure based on the model of a permanent Call with the deadline for submitting
applications by December 10, 2019 until 3pm.

7 Accordingly, the value of equipment procurement ranges from €25,000 to €100,000.

6. Program line for innovation improvement

Support for the introduction of innovation aims to enable businesses to access the knowledge and
experience they need to become innovative and enhance their competitiveness and productivity.
At the same time, companies are encouraged to establish new relationships with specialized
consulting companies, scientific research centers, centers of excellence, science and technology
parks, innovation-entrepreneurship centers and business incubators, which should stimulate transfer of knowledge and innovation.
The goal of the Innovation Improvement Program line is to strengthen the business performance of
micro, small and medium size enterprises through co-financing the use of consulting services in the
implementation of innovative activities. The support is focused on covering the costs of consulting
services of innovative activities in the company. Through the program, businesses will be supported
for the following innovative activities: Innovation of products / services; Innovation of the business
process; – Innovation in the organization; Innovation in marketing.
The total budget for the implementation of the Program line for innovation improvement is 50,000.00
€. The principle is that the company finances 100% of all costs until the completion of the innovative
activity for which it is applying and then after the submitted documentation proving the spending
of the contracted activity funds, the Ministry of Economy approves the refund of part of the costs in
the amount of up to 50% of the eligible costs, and in the maximum amount up to 3,500.00 € without
VAT. The public call is conducted as an open procedure according to the model of a permanent Call
with the deadline for submission of applications by September 30, 2019 until 3pm.

7. Program line for providing the mentoring services

Mentoring is a comprehensive process of support to companies (business entities) and entrepreneurs
aimed at supporting the unhindered development and reducing the number of failed enterprises and
entrepreneurs. Project implementation constitutes a collaborative work of mentors and companies/
entrepreneurs in order to overcome the current situation and find the most suitable solutions for
future operations. Mentoring process represents a certain number of hours that a professional –
mentor spends in direct contact/work with the company owner/entrepreneur.
The objective of the Program Line for providing the mentoring services is to enable free, non-financial
support for micro, small, medium-sized enterprises and entrepreneurs involved in the production or
provision of services8
. The total budget for realization of the Program line for providing mentoring
services in 2019 is 35.000,00 €. The Public Call for this Program for 2019 was closed on May 29, 2019.

8 The mentoring process takes place according to the established mentoring scheme, developed in cooperation with the
Japan International Cooperation Agency (JICA).

8. Program line for entrepreneurship development

The overall goal of the program line is to enable the improvement of efficiency and institutional
support to their business and development through the support of opening new micro, small and
medium sized businesses, as well as encouraging the creation of new jobs. The support package
includes: free trainings, technical support for the preparation of a business plan and providing credit
arrangements under favorable conditions. The Investment Development Fund of Montenegro AD, in
cooperation with the Ministry of Economy – Directorate for Investments, Development of Small and
Medium Enterprises and Management of EU funds, implements non-financial and financial support
to improve the conditions for the development of entrepreneurship in Montenegro.
Funds in the amount of € 15,000.00 for realization of non-financial support are provided through the
budget funds of the Ministry of Economy, while the funds for receiving credit support are provided
through the budget of the Investment Development Fund of Montenegro A.D. The subject of
support is the provision of non-financial and financial support for the establishment of new and
improved business operations of existing enterprises that operate for a maximum period of one year
from the date of publication of the Public call. The Ministry of Economy will announce the 2nd Public
Call for this Program during the III quarter of 2019.

10. Program line for promotion and increasing the competitiveness of domestic products and services

The Ministry of Economy is implementing the project “Promotion of domestic products and services
in the function of building a national brand”, in cooperation with the Chamber of Economy of
Montenegro and the United Nations Development Program. The goal of launching this project is
to support the development of the Montenegrin economy, as well as building a national brand and
strengthening the readiness of consumers to buy domestic products.
In order for Montenegrin companies to “enter” and position themselves at the international market,
it is necessary to be competitive in the local market, to quickly adopt new technologies, to have
an accelerated cycle of production, quality products, to be flexible in changing the business
companies, to know other markets and characteristics of their demand. The program line focuses on
an institutional campaign that should promote the potentials of Montenegro, products and services,
as well as producers, through institutional campaigns: “Buy domestic”, “Good from Montenegro”,
products with geographical origin, innovative services, etc..

11. IDF financial support programs realized through loans

The IDF provides financial support programs realized through loans for entrepreneurship, agriculture
and food production programme, tourism, production, services, company liquidity, greenfield and
brownfield investments and infrastructure projects (water supply, energy efficiency and renewable
energy sources).
The loan terms vary depending on the purpose within the range of max amount of up to 6,000,000
EUR, interest rate up to 5% annually, repayment terms up to 15 years including grace period up to
5 years.
Specific credit lines consider that loans can be financed by European Investment Bank (EIB) with
interest rate lower by 0,5 – 0,7p.p. For entities implementing projects in Northern region municipalities
or in under-developed municipalities in Montenegro as well as for those that recruit 5 or more new
employees under the project realization, a special incentive measure of reduction of the interest rate by 0,50p.p. shall be approved. Additionally, incentives shall pertain to loans approved with a
commercial bank’s guarantee, in a way that the initial interest rate will be decreased by 1,00p.p.

Subsidies for employment

Subsidies can be used by the employer who hires:
• A person who is at least 40 years of age;
• Unemployed Roma, Ashkali or Egyptian;
• A person registered with the Employment Agency for more than 5 years;
• A person who is employed on public works;
• A person hired for an indefinite period of time after traineeship;
• A person whose services are no longer needed (redundant), and is registered with the Agency;
• A person who is employed to perform seasonal jobs;
• Unemployed person with over 25 years of insurance, who is a beneficiary of unemployment
• Persons in business zones.
With respect to persons referred to in this Decree, employers shall not pay:
• contributions for compulsory social insurance on wage earnings (contribution for pension and
disability insurance, health insurance contribution, contribution for unemployment insurance,
contribution for the Labor Fund);
• personal income tax.

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