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Progress Report on Montenegro 2018

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Key findings of the 2018 Progress Report on Montenegro

Political criteria

The reporting period has been marked by the low level of trust towards the electoral framework and the prolonged parliamentary boycott by the entire opposition since the October 2016 parliamentary elections. Returning the political debate to the Parliament is the responsibility of all political actors. Parts of the opposition returned to the Parliament in December 2017, but this partial and selective ending of the boycott is yet to result in improved parliamentary dialogue and scrutiny. The political scene remains fragmented, polarized and marked by lack of political dialogue, notably in the democratic institutions.

The parliamentary legislative capacity and the oversight of the executive needs to be further enhanced. The parliament still addresses the State Audit Institution’s audit findings in a limited manner, and there is no discussion or reporting on implementation of major policies and legislation. In December 2017, the Parliament adopted without proper public consultation a set of laws which only partially address the recommendations of the OSCE’s Office for Democratic Institutions and Human Rights (OSCE/ODIHR). A comprehensive electoral reform should be considered. There were 8 local elections in the reporting period. Local elections do not take place on the same day nationwide, but on a rolling bases; thus a prolonged and highly personalized election mood characterizes the political landscape. Due to the electoral cycle, election observation is difficult, particularly for international observers, leaving ample room for claims of irregularities that cannot be independently evaluated. There were no new developments in the political and judicial follow-up of the alleged misuse of public funds for party political purposes in 2012 (the ‘audio recordings affair’).

As regards governance, there is a need to strengthen transparency, stakeholders’ participation, and the government’s capacity to implement reforms. Coherence of the policy-making system should be ensured through co-ordinated policy development. Mechanisms for government’s consultation of civil society organizations are in place, but they need clear rules, and genuine involvement on both sides.

Montenegro is moderately prepared with the reform of its public administration. Good progress has been made, notably through the adoption of new laws on civil servants and state employees and on local self-government aimed at implementing merit-based recruitment across the public service. Strong political will is still needed to effectively address the de‑politicization of the public service and the optimization of the state administration, as well as to ensure efficient implementation and financial sustainability of reforms.

Montenegro’s judicial system is moderately prepared and some progress has been made. The legislative framework on the judiciary aimed to increase its independence and professionalism has yet to be fully implemented. Institutional capacity has been strengthened.

Montenegro has achieved some level of preparation in the fight against corruption. Despite some progress, corruption is prevalent in many areas and remains an issue of concern. The operational capacity of institutions has improved; however, all institutions should demonstrate a more proactive attitude. Challenges to the credibility, independence and priority-setting of the Anti-Corruption Agency need to be addressed. Financial investigations and seizure and confiscation of assets remain to be improved. An initial track record of investigation, prosecution and final convictions in high-level corruption cases has been established, but needs to be further consolidated. Further improvements of the track record of successful investigations and convictions will only be possible in an environment where independent institutions are shielded from any undue influence and incentivized to fully use their powers.

In the fight against organized crime, there is an initial track record of prosecutions in the fight against smuggling of migrants and against drug trafficking. However, further results are needed to produce a convincing track record, in particular in the fight against money laundering and trafficking in human beings.

On fundamental rights, Montenegro further aligned its legislation with EU standards. In particular the work of the Ombudsman office has improved, but more efforts are still needed in strengthening the institutional framework and effective protection of human rights. Following the progress made on anti-discrimination legislation, Montenegro now needs to ensure that adequate institutional mechanisms are in place to protect vulnerable groups from discrimination. Implementation of the legislation remains weak and institutional capacity on human rights needs to be increased. The Roma minority remains the most vulnerable and most discriminated community. Gender-based violence and violence against children remains a serious concern in the country.

Montenegro has achieved some level of preparation on freedom of expression, but no progress was made in the reporting period. There have been no notable developments regarding investigations into old cases of violence against journalists. Recent political interference in the national public broadcaster Council and the Agency for Electronic Media are a matter of serious concern. The media scene remains highly polarized and challenges in understanding the role of free media persists. The number of defamation cases remains high, also due to weak self-regulatory mechanisms.

Montenegro remained constructively committed to bilateral relations with other enlargement countries and neighboring EU Member States and an active participant in regional cooperation.

Although Montenegro so far remained outside the main Western Balkans migration route to the EU, it witnessed an increase in the number of migrants/asylum seekers entering its territory and must therefore strengthen its capacity to cope with sudden increases in migration-related pressure. Montenegro made further progress in particular on the migration-related legal framework. While Montenegro’s capacity to handle asylum requests has been sufficient so far, it might now be challenged by: (i) the growing number of asylum seekers and the extended length of their stays, sometimes due to lengthy appeal procedures; and (ii) the introduction of more demanding asylum procedures, aligned with the EU standards. Montenegro should open additional reception facilities that meet the required standards and improve management of all facilities. Further to the adoption of the Schengen action plan in February 2017, Montenegro continued to align its legislation with the EU acquis on visas

Economic criteria

Montenegro has made some progress and is moderately prepared in developing a functioning market economy. Macroeconomic and fiscal stability were strengthened but further efforts are required to address persistent challenges, especially the high public debt burden. The economy has been growing uninterruptedly since 2013 amidst low or moderate inflation. The financial sector has improved its solvency and liquidity. However, the export base needs to improve in scope and in quality to reduce the trade deficit. Rule of law weaknesses, including unfair competition from the informal economy, negatively impact on the business environment. The labor market faces structural challenges, reflected in low participation and high unemployment rates.

Montenegro has made some progress and is moderately prepared in terms of capacity to cope with competitive pressure and market forces within the Union. The construction of key infrastructure in a number of areas as well as developing human capital set the basis for improved competitiveness. Education reform is ongoing, but more efforts are needed to address the skills mismatch. SMEs remain confronted with numerous challenges, such as access to finance or regulatory complexity. Further efforts are still required to improve the overall export performance of local companies.


EU legislation

Concerning Montenegro’s ability to assume to the obligations of membership, important work on alignment and preparation for the implementation of the acquis has taken place in most areas. The country has a good level of preparation in areas such as company law and foreign, security and defense policy. It is moderately prepared in many chapters, such as free movement of goods, agriculture, food safety, veterinary and phyto-sanitary policy. Montenegro is at an early stage of preparation regarding fisheries and budgetary and financial provisions, and at some level of preparation in the area of environment and climate change, statistics, social policy and employment. Good progress has been made in the areas of company law, agriculture and rural development, food safety, veterinary and phyto-sanitary policy. There has been backsliding in the area of public procurement. Looking ahead, Montenegro should focus in particular on competition policy, environment and climate change and public procurement. Strengthening the administrative capacity for ensuring the application of the acquis remains a substantial challenge for Montenegro. Montenegro has continued to align with all EU common foreign and security policy positions and declarations.

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