the Constitution and includes equal treatment of foreigners. Macroeconomic stability has also been achieved; Montenegro has the lowest corporate tax rate in the region at nine percent, the country
credit rating has been evaluated at BB, and around 85 percent of government property has been privatized. Inflation in 2011 was just under three percent.
Montenegro has made great strides in its tax policy. In April 2003, Montenegro introduced the Value Added Tax (VAT) and in January 2006, a two-tiered tax rate where the standard rate is 17 percent and a lower rate of only seven percent apply to certain services which include tourism.
Montenegro has attracted considerable foreign direct investment (FDI). Foreign direct investment per capita is 860 euro, which is among the highest rates for countries in the region. According to preliminary data released by the Montenegrin Investment Promotion Agency (MIPA) FDI in 2011 reached 534 million euro, which is 23 percent lower than 2010, however.
Over 5,200 foreign-owned firms are registered and operating in Montenegro. Foreign investors come from 107 countries, with no single country dominating investment. To date the most significant investments have come from Italy, Norway, Austria, Russia, Hungary and Great Britain.
Geographically the largest amount of FDI (49 percent) has been concentrated in the central region of Montenegro, with 44 percent directed to the southern region and the remaining seven percent in the north. Based on job-creating foreign investments (i.e. not including individual real estate transactions), the sectoral breakdown of FDI for 2011 is as follows: 21 percent of all investments were made in finance; 24 percent in tourism; 23 percent in manufacturing industry; eight percent in construction; 10 percent in services; four percent in transportation; two percent in agriculture; and the remaining eight percent in other sectors.
Private Sector Development
Around 85 percent of the capital in Montenegrin companies has been privatized. The Privatization Council adopted a strategy for 2011 and the privatization process will be continued by publishing tenders for the following companies: Montepranzo Boka Product land holdings, Montecargo Container Terminal, Montenegro Airlines and Institute Milosevic health center.
Development of tenders in 2012 are proposed for the following companies:
Montenegro‘s Post Office, Railway Transport of Montenegro, Railway Infrastructure
of Montenegro, Adriatic Shipyard, Port of Bar, Pobjeda newspaper, Zora milk