Republic of Montenegro: 2007 Article IV Consultation: Staff Report; Staff Statement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Republic of Montenegro
February 4, 2008
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The economic expansion in Montenegro is proceeding at full strength. The economy is overheating. Rapid credit growth is overstretching banks, and has contributed to ballooning asset prices. Eroding competitiveness is a concern. Management of the boom falls on fiscal policy. Tax cuts have been procyclical and potentially destabilizing. Fiscal risks need to be contained. The main focus of credit policy should be to strengthen banking sector supervision. Completing the transition to a market economy should be kept at the top of the policy agenda.
Subject: Banking, Credit, Economic sectors, Fiscal policy, Fiscal stance, Labor, Money, Public sector, Tourism
Keywords: authority, Baltics, CR, Credit, credit growth, FDI inflow, Fiscal stance, foreign direct investment, Global, ISCR, Montenegrin authorities, outturn, policy, Public sector, retail price inflation, staff appraisal, Tourism
Pages:
62
Volume:
2008
DOI:
Issue:
048
Series:
Country Report No. 2008/048
Stock No:
1MNEEA2008001
ISBN:
9781451826708
ISSN:
1934-7685
