Montenegro: another Balkan nation to experience unrest

Montenegro: another Balkan nation to experience unrest
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Montenegro is currently experiencing instability over its proposed membership of NATO, corruption allegations and anticipated elections later this year.

Uncertainty blights the countries of the former Yugoslavia. Crisis has gripped Macedonia over the past year and Kosovo has been divided over a deal made with Serbia over the status of its northern region. Montenegro, a tiny state of less than a million people – which seceded from Serbia in 2006 – has been a rare example of a peaceful multi-ethnic country in the Western Balkans, but is now split over NATO membership, claims of corruption and a government facing pressure over this year’s elections.

Economic progress

Figure 1: Montenegrin GDP growth 2006-2014 compared to its neighbours, source: World Bank

The Montenegrin economy has grown consistently in the years since independence and like some of its neighbours, has made a number of liberalizing reforms. As one example, in the Heritage Foundation’s 2016 ‘Index of Economic Freedom’, Serbia, Montenegro and Macedonia rank higher than countries such as Italy and France.

 

Figure 2: Western Balkans GDP growth 2016, source: World Bank

Montenegro’s economic strategy has been one based on tourism and as an attractive place to invest. The country uses the euro as its de facto currency, without being an official member of the Eurozone. This has meant – for the most part – inflation has been low. Situated on the Adriatic coast, Montenegro is considered a low tax haven and budding billionaire’s playground.

Figure 3: Inflation in Montenegro compared to the Eurozone, 2006-2015, source: World Bank

Despite the solid economic progress, Montenegro is often accused of being one of the most corrupt countries in Europe, in a region – the Western Balkans – particularly notorious for lack of transparency and clean government. Long-standing Montenegrin leader, Milo Đukanović, was named ‘Person of the Year’ last year by the Organized Crime and Corruption Reporting Project (OCCRP) for “his work in promoting crime, corruption and uncivil society.” The European establishment, however, continues to back the regime in Podgorica. This is in stark contrast with the approach to neighbouring Macedonia, where EU leaders have closely supervised a transition towards new elections following a corruption scandal. The conservative block in the European Parliament – albeit containing a motley crew of right wing parties – complained recently of double standards over the treatment of Montenegro, Macedonia and Serbia.

Protests against the government and corruption have intermittently erupted over the past year and in January the opposition attempted an unsuccessful vote of no-confidence in Đukanović. There have been recent talks between the parties to try and resolve an impasse over this year’s planned elections. Opponents allege Đukanović is using the state apparatus to sway the outcome. If an agreement cannot be reached, unrest may flare again.

Fears of Russian influence

There are regular concerns about Russian influence in the Western Balkans. For instance, Voice of America recently reported that “Observers say Russian propaganda, NGOs and cultural organizations have made significant inroads in the Balkans – in Macedonia, Serbia, Montenegro and Albania. Most Balkan countries aspire to join NATO and the European Union, but Russian influence in the region is growing through Russian investments.”

NATO membership is the issue that most riles Russia. Montenegro’s move to join the alliance in late 2015 met with fierce criticism from Moscow. Russian Foreign Minister Sergei Lavrov said in an interview of Montenegro joining NATO: “It’s not about Montenegro. It’s about NATO’s attitude toward the development of relations not only with Russia, but also in ensuring global security. NATO is responsible for its own territory, and as it was written in the Washington Agreement, provides collective defense. Well in that case, sit within your borders, and no one will touch you.”

Lavrov invoked NATO’s actions in the Balkans during the 1990s and called for a Montenegrin referendum on membership: “They know that most likely the people whom NATO bombarded a couple of decades ago have not forgotten it, and that will be difficult to accept with enthusiasm the idea of their leadership to forget many things by joining NATO”. The issue has split Montenegrin society, many indeed demanding the issue is put to a referendum.

Russia is sending a delegation to Montenegro this month – apparently a favourite destination for Russia’s super-rich – “focused on the development of Russia’s relations with the Balkan countries in the interest of consolidation and strengthening the friendship of the brotherly peoples of Russia and the Balkans.” A closer look at the economic statistics, however, show that Russia’s economic ties with Montenegro are dwarfed by those of both the EU – of which it is a candidate country – and the rest of the Western Balkans.

Figure 4: Montenegro trade figures 2014, source: Eurostat

Montenegro is steadily moving towards both the EU and NATO but it is striking that European leaders have paid it less attention than its neighbours. Instability is still a risk in this corner of the Western Balkans.

Categories: Economics, Europe

About Author

Robert Ledger

Robert Ledger is an analyst on European affairs, with a particular focus on the Balkan and Caucasus regions. He has an MA in International Relations from Brunel University and a PhD in political science from Queen Mary University London.