Montenegro

Kassi Gojcaj

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  • Montenegro-
  • Population:
    • 0.6 million
  • GDP (PPP):
    • $7.4 billion
    • 3.4% growth
    • 0.1% 5-year compound annual growth
    • $11,913 per capita
  • Unemployment:
    • 19.7%
  • Inflation (CPI):
    • 2.2%
  • FDI Inflow:
    • $447.4 million

The United States-

Population:


    • 316.4 million
  • GDP (PPP):
    • $16.8 trillion
    • 1.9% growth
    • 1.2% 5-year compound annual growth
    • $53,101 per capita
  • Unemployment:
    • 7.5%
  • Inflation (CPI):
    • 1.5%
  • FDI Inflow:
    • $187.5 billion
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7 Major Sources of Economic Progress

legal system

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1. Rule of Law (legal system)

Although the government in Montenegro moves very fast in adopting new laws especially those necessary for the european union integration process their process of putting a decision or a plan into effect is weak. Montenegro is starting to use community practices such as changing tax legislation to european union standards. In 2009, Montenegro selected a government agent for the European Court of Human Rights, at which more than 869 cases related to Montenegro were still pending in 2012. On May 21st 2006 the majority of 55% voted in a referendum for Montenegro to become an independent country. Montenegro has successfully created laws which helped to achieve such significant improvements in the field of economics.

2. Competitive Market

Competitive market in Montenegro has a lot to do with farming. people in Montenegro such as farmers often trade their goods locally rather then exporting the goods to other countries. In order to get a complete understanding of this concept, say Paloka had a farm where he sold produce and Ujka raised livestock where he sold cows and sheep. Instead of selling produce or livestock to their city or other towns, Paloka would give Ujka 15 pounds of produce for a pig.
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3. Limits on government regulation

to open up a business there is no specific amount of money required. the only issue is being able to receive a license to own a business, it requires a lot of time and money. Registration procedures have been made easier that it just takes a euro and four days to process an application to register a business. the government in Montenegro have very strict rules of passing out licenses for businesses. the one thing the government does not have strict regulation with are thw types of businesses people want to start.
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4. An Efficient Capital Market

since Montenegro has become independent the government has been trying to bring in more foreign investments therefore generating more capital for the country. by doing this Montenegro can ultimately bring in more employment for their citizens, more imports and much more economic growth for the country.

5. Monetary Stability

european monetary stability is the system used in the EU for stabilizing exchange rates between the currencies of the member states participating in the exchange rate mechanism and the balance of payments support mechanism. the original ERM was formed in 1979 out dated in 1999 when the euro turned into the official currency of 11 EU member states

6. Low Tax Rates

if a country has high tax rates the unemployment in that country would be very higher the population could be very low, people do not want to work hard if they're only going to get a low percentage of the money they deserve. the corporate income tax rate are at 9% and tax revenue at 24% of domestic production,public dept is equal to 57% of GDP.

7. free trade

Montenegro’s main import partners are Serbia, Bosnia, Herzegovina, Greece, Italy, Germany, China and Croatia. Montenegro mainly imports energy, electricity and road vehicles. although it might not be as profitable, Montenegro's financial system has become more open. the top 5 products exported by Montenegro are raw aluminum by 42%, passenger and Cargo ships by 7.6%, scrap iron by 2.5% and lead by 3.3%. The top 5 products imported by montenegro are refined petroleum by 9.5%, cars by 3.8%, passenger and Cargo Ships by 3.3%, pig meat by 3.3% and packaged medicaments by 2.1%.
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