Montenegro and France signed an intergovernmental agreement on the implementation of priority projects and financial cooperation in early September, which envisages that they will work together on the construction of a university hospital in Podgorica, the new seat of the Government in the future "Montenegro business district", sections of the highway and expressways, the development of the electricity grid and the strengthening of digital transformation...
According to the document, France will provide support in the preparation of studies, purchase of machinery, equipment and materials, while for the implementation of the projects, special contracts for export, procurement, services and construction will be signed, which will be prepared by institutions and companies of the two countries, with the approval of the authorities and compliance with the law.
It is also emphasized that these contracts will not be subject to the procedures of the domestic Public Procurement Law, which means that companies from France can be selected outside of public procurement procedures. According to Article 13 of this Law, it does not apply if it concerns international contracts with European Union countries that are implemented jointly and for mutual benefit, but the European Commission must be notified of everything.
"The procurement procedure relating to contracts shall be carried out in accordance with Article 13, paragraph 1, indent 2 of the Law on Public Procurement, whereby the Government of France shall submit to the Government of Montenegro a list of selected and qualified French suppliers who have expressed interest in the implementation of the project, based on the list of requirements and criteria submitted by Montenegro, which potential candidates, suppliers and contractors shall meet. The Parties shall directly negotiate the selection of the French supplier or contractor, which shall be approved by Montenegro on the basis of the list. These negotiations shall result in the signing of commercial contracts. Activities shall be implemented by concluding agreements, conventions, programs or projects which the competent institutions and authorities shall prepare, as well as the companies of the Parties, envisaged to establish work programs and procedures related to the mobilization of financing and the resolution of other issues of common interest," the agreement states.
The Parliament gave the green light to the agreement in mid-October, while the Law on Ratification of the Agreement was then promulgated by the President of Montenegro. Jakov Milatovic.
Together against corruption
The agreement also emphasizes that in concluded contracts, the two states must not offer or give to a third party, demand, accept or promise, directly or indirectly, for their own or someone else's benefit, any inappropriate monetary or other gain, which may be illegal or corrupt.
"The Government of Montenegro and France undertake that the projects covered by this agreement will not lead to corrupt practices. They undertake to inform each other as soon as they become aware of any information that raises suspicion, and to take the necessary measures to correct it, within the stipulated period, for the benefit of the Government of Montenegro and France. In the event of non-compliance with these obligations, the Government of France reserves the right, as it deems most appropriate, to refuse to approve the contract and/or to suspend payments from the treasury loans granted to the Government of Montenegro and/or to request early repayment of all or part of the treasury loans granted to the Government," the document signed by the Minister of Public Works Majda Adzović and French Ambassador to Montenegro Anne Marie Maske.
It is emphasized that the French are also interested in financing priority projects, so the French Development Agency Group, which includes the French Development Agency (AFD), "Proparco" and "Expertise France", will submit an offer to Montenegro for financing the work on behalf of that country. Among the sources of financing are donations from the Fund for Studies and Support to the Private Sector (FASEP) for a feasibility study and a pilot project by French companies for Montenegrin institutions, direct loans from the French Treasury, state loans, loans with and without state guarantees...
It is also stated that additional financing agreements should be signed to finance more priority projects, but that Montenegro has the option to choose.
"The Government of Montenegro may choose another form of financing for priority projects not covered by this agreement, depending on financial conditions and budgetary possibilities. The Government of France grants financial support to the Government of Montenegro for the implementation of the design, construction and equipping of the new university clinic in Podgorica. In addition to financing in the form of a donation in the amount of 1.000.000 euros allocated on May 23, 2024 to finance the preliminary design studies of the new clinical center, the financial support includes: a direct loan from the French Treasury, bank loans with a guarantee of "Bpifrance Assurance Export", in accordance with the OECD arrangement (state-supported export credits) - financing represents a maximum of 85 percent of the amount of the export contract. This financing must be used for the purchase of French goods and services in France, under the responsibility of French suppliers, the purchase of Montenegrin or foreign goods and services, in the amount of up to 50 percent of the amount...", the agreement states.
Project troubles deeply rooted
The agreement states that any dispute regarding the interpretation or implementation of the document will be resolved through consultations or negotiations between the governments of the two countries. The Impact Assessment Report (RIA) for this agreement states that the goal of the agreement is to resolve systemic obstacles to the planning and implementation of large projects, enable the establishment of sustainable international partnership arrangements, strengthen the capacities of domestic institutions, simplify access to international financial instruments and funds, ensure more efficient resource management...
It is emphasized that potential obstacles to the implementation of the agreement are a lack of resources, resistance from stakeholders, technical and infrastructural inadequacy, but also political will and coordination of institutions, so monitoring and assessments will be carried out by the Ministries of Health, Finance and Public Works.
"The causes of the problems that limit the implementation of large public projects in Montenegro are multi-layered and deeply rooted in the existing institutional and regulatory frameworks. The first key challenge is the lack of international partnership arrangements; without strong partnerships with international organizations and investors, domestic capacities remain isolated and insufficiently strengthened. The second cause relates to the limited capacities of domestic institutions for strategic planning and implementation. The lack of professional staff, weaker interdepartmental coordination and insufficient use of modern project design and management methodologies seriously limit the efficiency of public policy implementation. The third cause is limited access to international financial instruments," writes RIA.
The Ministry of Finance gave the green light to this agreement, clarifying that its signing will not affect the business environment, nor will it require money from the state treasury for its implementation.
They also measure sections of highways
When it comes to cooperation with France, Prime Minister Milojko Spajić is also considering financing infrastructure through public-private partnerships, because in this way, huge investments can be made in a fiscally sustainable manner.
He announced this in April last year, when he pointed out that the French company "Bouygues" was interested in working on nine sections of highways and expressways, except for the Mateševo - Andrijevica section. He explained that the company had also carried out work in neighboring Croatia.
At the time, he also stated that the Government was considering centralizing state administration, which would bring eight to nine thousand employees to work in one place.
"That project would imply more efficient administration, there would be no congestion. We would not have security problems like digging tunnels, we would make a green transition, we would have solar panels," Spajić said.
He explained that with that step, the administration could work in one building, while the other premises could be rented out, which could significantly reduce or completely cancel this type of investment.
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