Food imports are 16 times higher than exports, which is why the market position of domestic products, that is, the food industry in Montenegro, needs to be strengthened and affirmed, according to the president of the Board of the Food and Agricultural Industry Association in the Chamber of Commerce (PKCG), Milutin Đuranović.
"Food imports are 16 times higher than food exports. All the measures that are implemented obviously did not produce results to the extent that they should have. This is exact data, we can speak nice words, but the figures deny us", said Đuranović in an interview with the Mina-business agency.
He stated that the Government has various mechanisms that it can undertake, such as the Agricultural Budget or strengthening the market position of domestic products, which must be systematized, continuous and very intensive.
"The government, for example, must keep in mind that we have food imports of over 700 million, and food and drink imports of over 900 million. The impact is partly inflation, but realistically we have an increase in food and beverage imports," said Đuranović.
He said that if each consumer spent an additional one euro to buy domestic food and drink, the import of food and drink would decrease by 237 million, or by a quarter.
"If one euro were used only for domestic food, food imports would decrease by one third. Very exact data and someone who wants to make a decision has a foundation in that data. This is an excellent way to affirm domestic production and to make it our goal that imports give way to domestic production", Đuranović assessed.
He stated that when imported products are bought, 80 percent of the money leaves Montenegro, while 20 percent remains in the country.
"And when domestic products are bought, 80 percent of the money stays in Montenegro. Very interesting, exact data from which the Government must start", believes Đuranović.
According to him, the Government is responsible for economic policy, and taking into account the fact that we have a huge deficit of foreign trade payments and continuous borrowing from day to day, the executive power must take a responsible, systematic approach and find a way to affirm and develop domestic production and thus solve problems, reduce indebtedness, foreign trade deficit, but also increased employment and tax inflows.
He stated that the degree of coverage of import by export of food in Montenegro last year was about 6,2 percent, which speaks of our state in agriculture.
Đuranović, commenting on Monstat's data for the first two months on the coverage of imports by exports of 20,4 percent, said that Montenegro is a tourist country and that the number of tourists increases in that case and the biggest imports happen during the season.
"The reason is that mostly our guests come in large numbers from neighboring republics, where we import food and drink, and they are normally interested in favoring the purchase of products originating from their countries," said Đuranović.
As he said, Montenegro is a small country and we do not have any advantages in terms of the production of agricultural products.
According to him, in the effort to increase production, a very important subject is the state, followed by consumers and the third subject are trading companies.
"The state can influence in different ways. One way is administrative measures, which refer, for example, to the increase of excise taxes or the introduction of quantitative restrictions, as Serbia did with limiting the export of milk", said Đuranović.
He stated that other measures relate to strengthening the market position and state-led campaigns.
"For example, we have a campaign that has been going on for 26 years in Croatia, which is backed by the state and where it systematically, continuously and very intensively promotes the purchase of domestic products and affirms the advantages of buying domestic products," said Đuranović.
He announced that in Montenegro, politicians are very passive in terms of purchasing domestic products.
"I use the opportunity to invite the Presidents of the State and the Assembly, MPs, Prime Ministers, Ministers and Mayors to contribute in different ways by affirming and buying domestic products," said Đuranović.
He stated that the consumer is also an important factor and can be decisive for the development of domestic production.
"He decides whether to buy domestic or imported product. Let's say, in Italy you only have Italian wines. In Montenegro you also have Italian wines, but in Italy you don't have Montenegrin wines", said Đuranović.
In Montenegro, as he stated, neither national consumer awareness nor consumer pride has been developed.
"I think that our consumers should behave in a way that they think and be proud of the products they buy, which are domestic products. The development of consumer awareness takes time, but the state can have a strong influence through various campaigns, to shorten that time", Đuranović assessed.
He believes that the time will probably come when our shelves will be dominated by domestic products, now they are imported.
"It is very important for the consumer to understand that when he buys domestic products, that money from the purchase stays in Montenegro. When he buys domestic products, he invests in his own country, in the future of his descendants and his own future. And when he buys imported products, the money goes away, which means he invests in another country," added Đuranović.
He stated that domestic trading companies also play an important role, because they decide what they will sell and what will be on their shelves.
"The current situation is such that the shelves of trading companies are dominated by imported products. In many other developed countries, the situation is the opposite. Here, the positions of domestic products are still limited", said Đuranović.
He reminded that agriculture is the activity of cultivating land with the aim of producing food.
"Unfortunately, we pretty much devastated that land, concreting it, so that in Bjelopavlići, you have about five or six factories for the production of stone, i.e. cutting marble, stone slabs, plastic factories, simply plants that, in my opinion, should not have been found on agricultural land. So, we have continuous devastation of agricultural areas, and with that we reduce the chances of producing food", Đuranović assessed.
He assessed that some legal regulations should be passed that will prevent the destruction of agricultural land and its conversion into construction and industrial land, and then find a way to consolidate the fragmented land and, in the end, it would be very important to invest in the village.
"Otherwise, what will happen? It will happen in the next nature that we will all live in cities, in concrete, that we will import almost all food, that it will be more and more genetically modified. Healthier food will be less and less and its prices will rise", said Đuranović.
He stated that we now have the opportunity to produce food on the land we own, which we have partly converted into construction land, but there is enough of it left to produce healthy food and thus meet a greater or significant part of our food needs.
Đuranović, speaking about the impact of rising inflation, as well as the price of energy and raw materials on business, said that Montenegro is an import-dependent economy and we have imported inflation, although it is often used or perhaps misused in newspapers that inflation has something to do with price increases or some programs .
"A wave of inflation has reached us, but in any case it does not suit anyone. All ingredients, i.e. input prices are rising and normally the prices of finished products must rise as well. The prices of finished food products have increased by some 40 to 44 percent, and this makes it difficult for input prices to rise. In this particular case, the prices of animal feed", said Đuranović.
He said that, on the other hand, there has been an increase in the prices of finished products and the consumer basket is becoming more expensive and does not suit the consumer either.
"In any case, we believe that there will be some stabilization of prices and it is much nicer to live in stable times than in those stormy, unstable times", believes Đuranović.
Speaking about the Government's decision to limit margins for more than 500 items, he said that he was commenting on it with approval.
“It's natural. This is the first activity of the Government, which linked the purchase of domestic products to all those plans to protect the living standards of the population. It's not only logical that I support it, it should be supported by every consumer. I believe that this is the first in a series of systematized activities in terms of affirming the purchase of domestic products", stated Đuranović.
Speaking about the Agricultural Budget, which is worth around 75 million euros, he said that we all have to keep in mind that budgetary support for agriculture has the character of an investment.
"When the Ministry of Agriculture allocated money for assistance for the purchase of pregnant heifers last year and the year before last, and it is in the budget this year, the purchase in Montenegro increased by ten percent. Because people had the opportunity to import heifers with subsidies. But that heifer is about to calve, so she will give milk. Then she will calve again, and we will have another calf. So a farm is formed from one heifer. And in the end she ends her life. We have a meat industry," explained Đuranović.
He stated that the EU is well aware of this and therefore does not treat the agricultural budget as an expense, but as an investment.
"The one who makes decisions, that is, the Ministry of Finance, must also understand this, because the representatives of the Ministry of Agriculture are aware of it," said Đuranović.
Agriculture, as he said, is a low-accumulative activity and capital, by the nature of things, does not go there.
"He goes into high-accumulative activities, such as oil or telephone production. But we cannot eat the phone for breakfast, nor can we drink oil instead of milk. We need food, which needs to be produced. Well, that is the reason why, through the budget policy, funds are redirected from high-accumulative activities to low-accumulative activities, i.e. towards agriculture", believes Đuranović.
He stated that the Agricultural Budget preserves the living standards of the population, because if as much as possible is allocated to the Agricultural Budget, we will have a more developed agriculture.
Đuranović also said that care must be taken about the timely adoption of Agrobužet, because it is known exactly when to plant potatoes, alfalfa and everything else.
"There was an increase in the budget and in absolute terms it was never bigger. But we have to see that it is not all on the territory of our taxpayers. There is one part that is a grant from the European Union," said Đuranović.
Direct budget payments for agriculture, as he reminded, amount to about one percent, and the participation of agriculture in the creation of the gross domestic product of Montenegro is about seven percent plus agro-industry, we are approaching the figure of ten percent.
"So this budget will provide simple reproduction. In my opinion, he is not developmental. We must have much larger budget allocations for agriculture", believes Đuranović.
Đuranović is a co-owner of the Šimšić-Montmilk company, that is, the Lazine dairy. When asked what are the key barriers he has faced in business, he replied that he loves production and the work he does, because milk is a healthy food.
"But I have to admit that now, after 26 years of being in this business, I'm not sure that I would do this job again if I knew what I was going to go through," said Đuranović.
As he said, the milk industry is a low-accumulative activity. A lot is invested at the beginning, there are large depreciation costs, as well as ongoing maintenance, and the profit is very small.
"But, in any case, we are very successful, surviving for over two and a half decades. I think the main characteristic is quality, which we pay special attention to and that is what keeps us going. Our main competitors are multinational companies that have behind them investment funds that invest billions," said Đuranović.
Đuranović, speaking about the key results of the Board, said that he is not satisfied with the results achieved in PKCG.
"I have been the chairman of the Board of the Association for the Agricultural and Food Industry for a long time, I invest a lot of time and effort, but I am not satisfied with the results. I'm not sure if my expectations or plans are overestimated, but if we have such a large import, it means that our results are not within the limits of what we set at the beginning", said Đuranović.
He highlighted the Dobro iz Montenegro campaign, which was the most comprehensive and systematic and produced the most results. The recognition of domestic food products on the market is largely due to that campaign.
PKCG continues with the campaign The strength is in all of us, which is dedicated to strengthening the domestic economy and businessmen. PKCG's mission for this campaign is to raise awareness of the importance of the Montenegrin business community, by providing support to existing entrepreneurs and motivating future leaders and young people to take entrepreneurial steps.
PKCG, as a hub of knowledge and expertise, plays a key role in providing continuous support to the economy and entrepreneurs.
Also, the campaign wants to affirm the importance and potential of strong synergy among businessmen, because joint work and exchange of knowledge enable a better understanding of the challenges and opportunities they face. This connection contributes to the strengthening of the business community, helping existing entities to achieve better results, while at the same time providing support to young and ambitious entrepreneurs in achieving their goals.
Through continuous support and promotion of synergy among businessmen, the Strength is in all of us campaign continues to shape a better future for the domestic economy, creating a stronger, more sustainable and more connected community.
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