Mundo’s Country Rating (Out of 10)

Mundo´s country rating is essentially a freedom index whereby our team of specialists rate a combination of freedoms which include freedom from violence and personal attacks, financial freedom from high taxes, business freedom from government interference and especially from socialism and communism.

Political stability: 8

The country is, by far, the most stable and the most pro-business country in the Balkans. First of all, the protection of private property is established in the Constitution, and foreigners are at an equal legal level with national investors. In 14 years since Montenegro’s independence, there hasn’t been one single case of the government expropriating foreign-owned property in the country, and foreigners are free to partake in the sale of formerly public assets.

Since its independence, the country has aimed at EU membership. That means it needed two main things: to turn into a stable democracy and a free economy. And that’s what they’ve sought. 

The country had a history in their favor: it was the only former Yugoslav Republic with no war on its ground during the 90s. Likewise, the country enjoys good relations with its Balkan neighbors, with Russia, and with the European Union, meaning its membership application is on the right track. 

Milo Dukanovic has ruled the country since 1991. That’s good on the one hand, as his grip to power means the country will continue its pro-business reforms, and the political system is stable. But, on the other hand, that’s negative as the judicial system will continue to be unreliable and there’s rampant corruption across the political system.

Personal safety: 8

The crime rate is fairly low, especially for Balkan standards. Violent crimes are infrequent. That means that common precautions such as avoiding late-night walks around the park and watching your pockets in crowded places are more than enough.

During the tourist season, petty crimes are increasingly common, especially in the Southern coast, and harassment and abuse against foreign women are exceptionally uncommon. 

The main problem in the country is organized crime, but there are no gang wars that affect foreigners on their daily businesses in Montenegro.

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Lifestyle: 7

The country is well-known for its natural and architectural beauty and its calm ambiance. It’s one of the Mediterranean top touristic spots, even as it’s somewhat unknown for many.

Life can be comfortable in most of the country. Rent, services, transportation, and daily products are incredibly cheaper than in most Europe. Nightlife is terrific in Budva, and it has been nicknamed the “Balkan Miami” because of its heavenly beaches and party-hard nightlife. Podgorica has a vibrant cultural mix with all the services Westerners are used to, and it’s as beautiful as the rest of the country.

The main issue the country has is the language. Montenegrin is a harsh language to learn, and some people use Latin characters, while others prefer Cyrillic, which increases confusion. In general, English is standard in touristic areas, but still language is a barrier that´s hard to breach in Montenegro. Also, for those used to the fast-track Western life, they may find Montenegro as too village-like for their liking. After all, the whole country´s population is only 600k people.

Tax optimization: 9

A 9 % corporate tax rate. Yes, you read that right. What about the income tax rate? It’s a meager bracket between 9 and 11 %. Non-resident companies are taxed only on their income generated in Montenegro, and all capital gains (bonds, interests, dividends) are taxed at a flat 9 %, which is significantly lower than most European countries. Likewise, it offers tax benefits for the nautical business. Its Yacht Law is the most business-friendly in the Mediterranean.

The country has a strong network of more than 40 double taxation treaties that pave the way for tax optimization and stable tax planning for investors. In a European continent, where authorities seek new ways to take money from investors’ and companies’ pockets, Montenegro is a fortunate exception.

Investment Potential: 9

Montenegro has significant and untapped investment opportunities. Even its more developed sector, tourism, hasn’t reached its full state. Montenegro has doubled its tourism investment and income in the last decade, and there’s still room to grow. Financial services, agriculture, and energy are other industries that may see significant FDI influx and growth in the next few years as they have a ton of potential. Likewise, the government has been selling formerly public-owned land and companies as it’s seeking to reduce public participation in the economy. Similarly, as the country pursues the EU membership, more and more pro-business reforms occur every year that offer plenty of possibilities for investors in the country.

The country has also reformed its business regulations to make the process of opening a business even easier. Today, it takes around eight days. The real estate market is booming as the square meter is significantly lower than in most of Europe. Banking has also seen an influx of investment that may lead to wealth management services sooner than later, and the government is offering tax exemptions for companies that start operating in the north, which can lead to significant tourism, energy, and agricultural investments.

TOTAL: 41 (out of 50), A-

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