Podgorica, (MINA-BUSINESS) – The European Bank for Reconstruction and Development (EBRD) has revised up Montenegro’s economic growth forecast for this year to 3.2 percent.

This is 0.5 percentage points higher than the 2.7 percent growth projected in September. 

In its latest report, EBRD estimated that Montenegro’s economy will grow at the rate of 3.2 percent next year.  

It also revised up its economic growth forecast for 2025 to 3.2 percent, up 0.6 percentage points from September.

The report states that real GDP increased by 3.2 per cent year on year in January-September 2025, maintaining the same pace as in 2024. 

“Strong investment and sizeable wage and pension hikes offset the impact of increased electricity import needs after the Pljevlja plant closure and declining exports,” EBRD said.

The current account deficit widened in 2025 as arising merchandise trade deficit outpaced a

modest increase in the services surplus, and FDI inflows fell slightly, remaining concentrated in real estate. 

“Inflation rose to 4.0 per cent in December, fuelled by expansionary fiscal policy, strong wage growth, and higher pensions,” EBRD stated. 

Fiscal pressures intensified during last year: the budget deficit widened as expenditures outpaced revenues, and public debt neared 60 percent of GDP (as of September 2025), with borrowing needs financed partly through an € 850 million eurobond. 

“Real GDP growth is projected to stay at the level of 3.2 percent in 2026 and 2027, supported by EU accession progress and infrastructure investment. Weak fiscal buffers and low diversification leave the economy vulnerable to external and climate-related shocks,” the report reads.