The state budget for next year will amount to 3,77 billion euros, of which 2,97 billion will be provided from regular state taxes and other levies. The remaining difference will be provided by borrowing 488 million, donations 105 million and 200 million from deposits remaining from this year.
This is stated in the budget proposal for next year, which the Government adopted yesterday and which Vijesti has access to, as well as the draft decision on borrowing. By the time of writing, these two documents had not been published on the Government's website, so it is possible that some figures will be corrected. The Government announced that the material will be available after technical editing, and that everything will be presented on Wednesday.
Although the tabular part of the budget proposal lists a debt of 488 million euros, the text gives the government the opportunity to borrow up to 3,23 billion euros. This debt is divided into four groups: up to 500 million for debt repayment and budget reserves in the coming year, 637 million for capital projects from loans from European development banks, 1,1 billion for other capital and program projects from creditors that will, as stated, be determined later, and up to 1 billion euros that can be taken in the coming year and used to refinance debt and the fiscal reserve in 2027.
"In 2026, the State may borrow up to EUR 500.000.000,00 for the purpose of securing the missing funds in 2026, by concluding credit arrangements with international financial institutions, with domestic or foreign banks with or without a World Bank guarantee, through the issuance of treasury bills or debt securities on the domestic or international market, as well as by concluding bilateral or other credit arrangements. Notwithstanding paragraph 5 of this Article, the State may borrow up to EUR 1.000.000.000,00 in 2026 for the purpose of refinancing the debt and creating a fiscal reserve for 2027 and 2028, by concluding credit arrangements with international financial institutions, with domestic or foreign banks, through the issuance of treasury bills or debt securities on the domestic or international market, as well as by concluding bilateral or other credit arrangements," it is stated in the proposal for a decision on borrowing in 2026, which the Government also adopted yesterday.
According to the document that "Vijesti" has access to, the original revenues amount to 3,074 billion euros, while expenditures are projected at 3,35 billion. The budget deficit is planned at 278 million euros. The total receipts in the amount of 3,77 billion euros are distributed as follows: current budget 1,60 billion, reserves 39,86 million, state funds budget 1,404 billion, the capital budget is projected at 300 million euros, while the item "transactions and financing" is 430 million euros.
The budget for next year is 250 million euros smaller than this year, mostly because next year there will be fewer old debts to be collected (388 million euros), while this year 848 million euros had to be repaid.
They expect 200 million more from duties
Current budget revenues from taxes and other duties of 2,97 billion are 200 million euros higher than this year. The Ministry of Finance expects to generate 1,47 billion euros in value added tax revenue next year, which is 100 million or 7,3 percent more than this year. VAT revenues account for 49 percent of total original state revenues planned for next year, which creates a significant dependence of state finances on this consumption tax.
Excise duties are expected to generate 423 million (20 million more), corporate income tax 243 million (24 million more), personal income tax 121 million (13 million more), pension and disability insurance contributions 399 million (two million more), international trade and transaction taxes 70 million (six million more), fees 82 million (eight million more), fees 20 million (two million more), other revenues 65 million (13 million more)...
The total missing funds (the difference between total revenues and expenditures) amount to 704 million euros, and according to the budget proposal, they are planned to be covered by new borrowing in the amount of 488 million euros, from deposits of 200 million euros from this year, the sale of assets for six million and proceeds from loan repayments of 9,7 million euros.
The budget proposal does not specifically mention revenue from airport leasing fees, nor from the legalization of illegal facilities, even though the law on legalization itself stipulates that 20 percent of this fee goes to the state budget.
249 million for social assistance
The most significant expenditure next year will be the payment of gross salaries in the public sector of 726 million euros, which is 10 million more than in this year. The payment of net salaries will require 588 million euros, which is 25 million euros or 4,4 percent more.
To repay interest next year, 174,8 million euros will be needed, which is 15 million more than this year.
249 million euros are planned for social assistance next year, which is eight million more.
252 million euros, or 35 million more, are planned for transfers to health institutions from the budget.
For the payment of pensions in the coming year, 837 million euros are needed, or 60 million euros more than this year. Since 399 million euros are expected from contributions for pension and disability insurance, the deficit of the Pension and Disability Insurance Fund (the difference between the collection of contributions and the payment of pensions) will amount to 438 million euros. Since the state is the guarantor of pension payments, this deficit is covered from other state revenues. According to these data, 47 percent of the money needed for the payment of pensions will be provided from earmarked contributions for pension and disability insurance, and 53 percent from other budget revenues.
An amount of 388 million euros is planned for debt repayment, which is 460 million euros less than the figure the state had to repay this year.
The current budget reserve is planned to amount to 39,8 million euros, while last year it amounted to 43,1 million euros.
Guarantees of 172 million for several state-owned enterprises...
According to a document seen by Vijesti, the state may issue guarantees in the total amount of 171,95 million euros next year for ten different credit arrangements for state-owned companies. The guarantees would cover projects in the energy, water supply and railway transport sectors.
A state guarantee of up to 25 million euros is foreseen for a loan arrangement between the Montenegrin Transmission System (CGES) and the French Development Agency (AFD) for financing the “project for the reconstruction and expansion of the 220/110 kV Perućica substation and the procurement of 400/220 kV Pljevlja 2 autotransformers”. In addition, a guarantee of up to 18 million euros is planned for CGES for a loan arrangement with the European Bank for Reconstruction and Development (EBRD) for the construction of the Vilusi–Herceg Novi transmission line, as well as a guarantee of 15 million euros for financing the project to increase the capacity of the 220 kV transmission line.
For the Montenegrin Electricity Distribution System (CEDIS), a guarantee of up to 35 million euros is envisaged for a credit arrangement with AFD, intended for the implementation of the "project for the reconstruction of six 35 kV plants and the replacement of equipment in 250 10/04 kV transformer stations".
The Montenegrin Coast Regional Water Supply Company has received two state guarantees for projects with the EBRD. The first, in the amount of up to 12 million euros, relates to the second tranche of a loan arrangement intended to improve the regional water supply system through development projects. The second, worth six million euros, is intended for the construction of additional reservoir capacities and increasing the energy efficiency of the regional water supply system.
In the railway sector, the Railway Transport of Montenegro (ŽPCG) is planning three state guarantees. The first, up to 11.250.000 euros, refers to a credit arrangement with a creditor that will be determined during the year, for the investment repair of nine passenger cars of the “Y” type. The second, worth up to 4.700.000 euros, is planned for the regular repair of electric locomotives with modernization, while the third guarantee, in the amount of up to 30 million euros, would be intended for the purchase of new passenger cars with bearings.
The state will guarantee Montecargo up to 15 million euros for a credit arrangement with a creditor that will be determined during the year, for the purchase of a rolling stock and modernization of rolling stock.
Continuation of the highway, the Budva bypass, Velje Brdo...
The item for capital expenditures in the coming year amounts to 379 million euros, which is an increase of 18 million compared to this year.
Of the total capital budget, 165 million euros belong to the Transport Administration, of which 97 million or 58 percent are earmarked for the construction of highways. Of this figure, 65 million are earmarked for the start of construction of the Mateševo - Andrijevica section, where the contractor selection process is still underway in a joint procedure between Monteput and the European Bank for Reconstruction and Development.
The new 24-kilometer section of the highway, according to government expectations, will cost 600 million euros. The selected contractor should complete the design and construction in five years. In total, this section would be financed with 250 million from the budget, 200 million from the EBRD loan and a 150 million EU grant.
For the Budva bypass, or the future Markovići - Lastva Grbaljska expressway, only 30 million are planned. The process of selecting a contractor for this investment is also underway at Monteput. The construction will take five years and cost a total of 200 million euros.
The remaining two million from the highway budget next year will be used to prepare documentation for the Adriatic-Ionian highway and the future network of expressways.
The Ministry of Public Works receives a portion of the capital budget of 135 million euros.
Nine million euros are planned for the continuation of the construction of three ski resorts - two and a half million for Cmiljača, three for Žarski, and three and a half million for Hajla.
Among the new major investments, there are the construction of infrastructure for the Velje Brdo project worth 10 million euros, the construction of a gondola from Igalo to Ilinica worth two million euros, the heating of Pljevlja worth 4,2 million, the construction of the University Clinical Center in Podgorica worth six million euros, two and a half million for the reconstruction of the Administration for the Execution of Criminal Sanctions in Spuž, 2,6 million for the radar on Bjelasica, 3,1 million for the expansion of the barracks in Danilovgrad, two million for the Lovćen - Cetinje cable car, 1,1 million for the sports hall in Plužine, three million for the covering of the Olympic swimming pool in Podgorica...
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