The delay of numerous investment projects, on which the growth of the Montenegrin economy is mainly based, has finally started to worry the executive power, whose representatives are now visiting and warning investors.
The opposition, however, says that investors cannot be influenced by tours and promises and that in the last few years the Government has been paying more attention to promotional activities than to what it was actually elected for.
It all started in June with a tour of the construction site for the future ski resort in Kolašin, when Prime Minister Duško Marković warned the contractors of the Kolašin 1600 ski resort and said that they must undertake additional activities in order to make up the backlog and realize this important development project. The construction of the cable car was awarded in July of last year to a consortium consisting of the Podgorica company Eminent, whose owner is Ratimir Saveljić, and the Austrian Doppelmayr Seilbahnen Gmbh with subcontractors, for a price of around 8,98 million euros and a five-year guarantee period.
This week, Marković again visited the construction site of the Kolašin 1600 tourist resort unannounced and said that the works are progressing, but that the competent authorities will continue to monitor them in the future.
The Deputy Prime Minister Milutin Simović, two months ago, during his visit to Cetinje, said that work must be done in accordance with the agreed dynamics, without delay, because infrastructure projects that are implemented from the capital budget in the area of the municipality of Cetinje are an important prerequisite for the rapid economic development of the capital.
In Cetinje, the construction of a new football stadium and the square and market in Njeguši are delayed.
Democrat MP Zdenka Popović told "Vijesti" that investors cannot be influenced in the way that Marković does, with tours and promises.
"It is necessary to protect the Montenegrin economy from dubious investors, resolutely investigate and prosecute all individuals or institutions that allow the inflow of dirty capital and prevent such investments in a timely manner. All investors who bring healthy capital and new technologies to Montenegro should be provided with quick and efficient administrative assistance and the creation of a favorable business environment. "It is only in the interest of serious investors to complete the investment within the deadline because the valorization of that investment will begin as the investor planned," said Popović.
Montenegro, she added, can be attractive to investors today, but the question is whether it will be attractive tomorrow due to numerous business barriers.
"This is because we have a slow administration, bad infrastructure, bad business climate, a large number of parafiscal levies and a huge imbalance between imports and exports. I just remind you that every investment is accompanied by a high import of equipment that is needed for the execution of works. A big problem is also caused by investors with questionable business creditworthiness. This is also the reason why a large number of projects, especially in the field of tourism, were announced or started but never completed. Such is the case with the Hotel As in Perazića Dol, a project in Maljevik worth 300 million euros, Blue Horizons, a project worth 250 million euros, the construction of an undersea cable, a highway...", stated Popović.
The construction of Hotel As in Perazića Dol began 16 years ago and is now being handled by the Prosecutor's Office. Two years ago, the Ministry of Tourism filed criminal charges against the investor, Nega Tours, for providing a false bank guarantee of three million euros. In May 2016, the Budva Riviera, acting on the order of the Government, filed a lawsuit with the Commercial Court for the termination of the contract on the sale of the hotel As.
Due to the delay of the Maljevik Detailed Urban Plan, the investor Sonuba Montenegro has not started construction of the announced luxury hotel complex on the field next to Sutomore for more than a decade. The construction of a hotel complex was planned in Maljevik, for which Sonuba bought 2007 square meters of land from the Municipality of Bar for 32 million euros in 200. Calculating utilities for the future hotel complex, more than 53,5 million euros were to be poured into the municipal budget, and the employment of 1.000 to 2.000 workers was announced. In 2011, the municipality of Bar was informed that Sonuba Montenegro, with which the contract for the purchase of land in Maljevik was concluded, had changed its owner, and that the new owner is the company Merkur, also from Russia. It was also announced that their investment interest is somewhat different from the one defined by the then valid DUP for that area. The Municipality of Bar then, in cooperation with the Ministry of Sustainable Development and Tourism, started the procedure for possible changes to the spatial planning documentation.
Although the Blue Horizon complex in Krtoli was bought by the Qatari Fund for 25 million from HTP Primorje eight years ago and promised to open a new resort with a five-plus-star hotel for the 2014 season, Qatari Diar has so far only demolished the old Blue Horizon hotel and has not built no new object. A resort worth 270 million euros is planned for that area.
In the Government's Information on the implementation of priority projects in the field of tourism for the period from January to June 2018, it is stated that Qatari Diar has invested 67,1 million euros so far. In the Government Information, it is written that "open questions that may affect the dynamics of the project's realization" are still the conversion of the right of use over three large plots within the complex that HTP Primorje sold to Qatari Diar into the right of ownership of the Qatari fund, and for which the procedure is still being conducted at of the Tivat Department of the Real Estate Administration. Ending court disputes with natural persons who have co-ownership of plots is also a problem. The agreement on connecting Italy and Montenegro with an energy cable was signed in mid-November 2010. The total value of the project is about one billion euros, and the completion of the works is planned by the end of 2018. However, the Italian company Terna has so far laid one core of the submarine interconnecting cable with a capacity of 500 MW, that is, one of the contracted two cores, with a total capacity of 1000 MW.
The SDP warns that the public is often deprived of answers to very important economic questions, such as the disastrous excise policy, increases in taxes and levies, unsolved problems related to privatizations and others, while ministers visit households with several head of livestock, open village waterworks or plants with five jobs each.
"The government and its representatives still do not provide answers that damaged the state for three million euros with false guarantees for Hotel As and why it is still a dangerous scam in Perazića Dol after 16 years. There is no answer to whose fault the loop on the highway was 'forgotten', which will cost the citizens 30 million euros. Nor why the highway project is being delayed even though the money has been secured", said Mirko Stanić, a member of the Presidency and spokesperson of the SDP, to "Vijesta".
Transport Minister Osman Nurković announced in June the possibility that the highway would be delayed. The reason is probably the Smokovac interchange, which was not an integral part of the initial project, but was designed afterwards. Stanić adds that there are no projects that will create jobs in production and industry, and growth is based on loans or weather conditions (the increase in electricity production is 97 percent this year, thanks to the rainy year).
"There are numerous other problems, especially in the field of tourism, wood processing, agriculture and infrastructure construction, and in some municipalities in the north, not even 10% of what was promised has been implemented," said Stanić.
The construction of the Kristal Riviera hotel in Petrovac is also significantly delayed. The joint venture agreement between Budvanska Riviera and Euromix tours was concluded at the end of May 2011. It is planned that out of a total of 269 accommodation units in the future hotel, 48 accommodation units will belong to the separate Kristal Hotel and become the property of Budvanska Riviera. The deadline for completion of the separate hotel was October 1, 2016.
"After a standstill of almost three years, work on the construction of the Crystal Riviera Hotel in Petrovac continued. When it comes to the project activities planned in the Capital Budget for 2018, which are implemented in the north of Montenegro, it is necessary to speed up the dynamics of their implementation, regardless of the limitations caused by the slow implementation of contracts with contractors due to weather problems, as well as the completion of appeal procedures that are conducted by the State Commission for the Control of Public Procurement Procedures", it is stated in the Government Information on the implementation of priority projects in the field of tourism.
The construction of the Montrose tourist complex on the Herzegovinian part of Luštica island, worth 210 million euros, is also delayed. The contract on the long-term lease of the Herzegovinian part of the Luštica peninsula was signed on September 11, 2009, but entered into force on August 26, 2013, with the signing of the protocol on its legal validity.
The Northstar and Equest Capital Limited consortium leased 520 square meters of land for the construction of a high-class tourist complex. The investor undertook to build a high-class hotel, Ritz-Carlton brand, and 29 luxury villas with accompanying catering and shopping areas, on 70 thousand square meters of usable area.
With the contract and the annex, Northstar undertook to invest 141,8 million euros in the first phase of the project over the next five years. The investor did not move beyond the administrative preparation, and the key justification is the lack of infrastructure.
In July, the Government said that they expect the Northstar company to fulfill the investment obligation within the agreed period and that the option of terminating the long-term lease contract will not be considered. They stated that the investor fulfilled the contractual obligations for the realization of which there were prerequisites, and accordingly paid an advance rent of two million euros, in accordance with the annex to the two contracts, concluded in February, and "the seriousness that the investor has shown so far in fulfillment of the first part of the obligations arising from annex two, instills certainty regarding the fulfillment of his remaining obligations".
Stanić: There is no oil, so we are building an expensive highway
Stanić believes that the Government is running away from the main problem - the unsustainability of the existing economic model, because an economy that does not produce any goods of a higher degree of processing cannot be promising, unless you find oil.
"As we have not found it so far, it shows that the government has thrown all its cards at the construction of an expensive highway and the development of tourism, which cannot be sufficient to strengthen the economy, but because of the low income rate, it is even operated with the lowest tax rate of seven percent," he says. Stanić, and adds that the SDP stands for the re-industrialization of Montenegro, a significant increase in activities in agriculture and a stronger role of the state in economic development through investments in infrastructure (ports, airports) and the energy sector.
He warns that Montenegro is in economic stagnation, because the average salary has been stagnant or even declining in the last period, so that it has hardly changed since 2012. "It is the most measurable proof of the economic development of the country, and we have witnessed that the minimum and average wages in countries such as Romania, Croatia, Bulgaria and Serbia have increased by 60% each in this period," said Stanić.
Change the economic strategy
Popović warns that almost all macroeconomic indicators indicate that the Montenegrin economy is growing only statistically.
"Without a change in economic strategy, there is no safe and realistic continuous economic growth. Therefore, without the development of small and medium-sized businesses, especially in the area of production and processing, especially in the agriculture and energy sector, there is no real economic growth. "Foreign direct investments and investment projects in general affect GDP growth, but it is of a limited nature," said Popović.
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