EU funds are an integral part of the EU accession story and are available in significant amounts, with additional complementary funds from the budget of multilateral financial institutions, which should be enough for Montenegro to improve in all aspects, as they provide direct and indirect support and multifaceted bilateral, trilateral and multilateral frameworks for enhancing the internal market, the rule of law and human rights, as well as fostering of regional and broader cooperation on economic and institutional levels. Montenegro, on its path to the EU, has already realized cooperation with the EU concerning three financial perspectives, amounting to up to €655 million, which includes funds realized before the signing of the Stabilization and Association Agreement, and before obtaining the status of a candidate country. However, there is still a lack of learning and applying experience to lead the country towards stronger institutional compliance with the EU acquis and the full realization of available funds, as stated, among other things, in the study “Unlocking the safe – Montenegro and EU funds over 12 years of negotiations” , by Mila Kasalica, an economic analyst, conducted within the project of the Centre for Civic Education (CCE) “CSOs in Montenegro – from basic services to policy shaping – M’BASE”.
“A complementary segment of the story about European funds in Montenegro is also represented by dozens of joint projects in various frameworks of the EU fund programmatic and strategic frameworks”, notes Kasalica, listing numerous such programmes. “The EU accession agenda in Montenegro, during the period 2012-2023, was marked by successful cooperation with nearly 1,500 experts for just over 1,000 events (seminars, workshops, video training/meetings), related to the project development, capacity building, mastering the acquis in different areas”, she explains and highlights additional benefits arising from these funds.
“This network of useful funds for project improvement and institutional enhancement documents 12 years of Montenegrin potential to gradually move towards the EU. At the same time, it points to the insufficient institutional and strategic readiness of Montenegro to learn from experiences and overcome the most important sustainability step: generating knowledge from the daily application of the accession agenda. Hence, the previous 12 years, Montenegro and EU funds have remained a narrative, lacking the expected ultimate outcome of Montenegro opening the gates to unstoppable reforms for overall social and economic development”, assesses Mila Kasalica.
Funds from IPA I (2007 – 2013) related to five components (assistance in the transition process and institution building, cross-border cooperation, regional development, human resources development, rural development) and in that part, Montenegro used financial support of 277.2 million €.
Funds from IPA II (2014-2020) also cover five areas (reforms in the process of preparing Montenegro for membership in the Union; socioeconomic and regional development; employment, social policies, education, promotion of gender equality and development of human resources; agriculture and rural development; regional and territorial cooperation) for which €279.1 million was available. According to data from April 2024, 79% of these funds are actually contracted. The novelty of IPA II is also the Instrument for Civil Society and Media for Montenegro for the period 2014 – 2020, which planned and allocated funds in the amount of €14.5 million.
The innovative financial perspective of IPA III (2021-2026) does not have pre-defined amounts of support per candidate country. Instead, it measures the relevance of public policies confirming strategic importance, as well as the maturity of the proposed projects, in accordance with the rules that apply in EU member states when using European structural and investment funds. Priority sectors are rule of law; good governance, alignment with the acquis, strategic communication, and good neighborly relations, fundamental rights and democracy; green agenda and sustainable connectivity; competitiveness and inclusive growth; territorial and cross-border cooperation. The application of this perspective is in the beginning in Montenegro, except for significant funds allocated and transferred to the beneficiary countries (Montenegro €30 million) in the first quarter of 2023 to mitigate the consequences of the energy crisis (2021-2022).
Following the proposal of a new EU instrument for reforms and growth for the region for the period 2024-2027, the Ministry of European Affairs has prepared Information on reform measures identified in the context of the preparation of the EU Growth Plan for the Western Balkans. The Reform agenda, in accordance with the prescribed methodology, which includes parameters related to the population and GDP of the beneficiary country, is an indicative document that can provide Montenegro with funds of up to €413 million, based on four main pillars: strengthening economic integration into a single EU market; strengthening the economic integration of the Western Balkans through a common regional market; acceleration of fundamental reforms to speed up the accession process, improving economic growth and strengthening regional stability; increasing financial support with the condition that reforms are implemented through the new financial instrument for reforms and growth of the Western Balkans.
“The Reform agenda consists of three areas and 14 sub-areas of public policies, which are more comprehensively elaborated through 61 reform measures. It is interesting that public policies addressing the project goals of the Reform Agenda are not included in the national budget for 2024, although the proposed list of projects is extensive and requires the focus of the state administration, both regarding the dynamics of preparation, approval and project implementation, and strict monitoring of implementation through positions of the national budget. Therefore, if the preparatory activities of the Reform Agenda would define an ambitious but shorter reform agenda, which should be additionally summarized and dynamically specified through the national budgets for each individual year, then the strict framework of the IPA III financial perspective will be applied in parallel, as well as the norms from the Growth and Development Plan for the Western Balkans”, points out Mila Kasalica.
Kasalica also emphasizes the importance of IPA teams and professional administration to efficiently use EU funds, noting that there has been a regression in this area. “Institutional memory of serious administrators, trainined for years in the system, has been removed from the state administration and often replaced by beginners… Without the useful experience of institutional, leadership and team self-knowledge, which was not done in the previous four years in the daily application of the IPA agenda, and which must be incorporated into the selection mechanisms members of the IPA teams, who meet the models of meritocracy, it is systematically impossible to get out of the entrenched models of discretionary decisions of heads of institutions, primarily dealing with breaking up teams in the state administration of Montenegro, regardless of whether it is based on nepotistic, party, or other similar approaches“, she assesses, emphasizing that this reduction in capacity also impacted the monitoring of measurable results, and that “the experiences of refunding funds after strict audit inspections have not been incorporated”.
“Data indicates that the Government of Montenegro in the period 2022-2023 strategically tried to slow down the overall accession process or replace it with unstructured, administratively unprocessed regional-type agendas, such as the Open Balkans initiative”, Kasalica points out.
She also reflects on national budget flows, explaining that they are important because they show how Montenegro has mastered and incorporated experiences, gained and learned while strengthening capacities during the application of IPA financial perspectives. “It should also be emphasized that Montenegro’s budget figures testify that more and better could have been done because there are enough available funds for a decisive step towards efficiency and productivity of public service in the country,” she states.
“During the 12 years of EU accession, the Montenegrin non-governmental sector has been and remains at the forefront of EU values. The rivers of implemented projects represent documented measurable benefits that the dream of joining has not faded over the years. Every year, with the support of the non-governmental sector, with justified criticism based on arguments, numerous tasks from the part of harmonization with the acquis were carried out, succeeding in gradually incorporating them into institutional improvements, both in the state administration and the overall public sector”, says Kasalica, and points out on the significant role of the NGO sector.
“The human factor was and remains a key risk, which should determine the key development trajectory of Montenegro in the next decade: within the development of the state administration of Montenegro concerning the EU accession agenda, but also concerning the overall regulatory and economic development agenda, there is a lot of inspiring work. Step by step, every decisive important activity needs to be carried out, without skipping difficult learning experiences from practice, and with measurable results. Then the Reform Agenda, which needs to be further improved to reflect the thirty most important project initiatives, will be in the service of strengthening the sustainability of the Montenegrin economy and the Montenegrin administration, as well as the entire Montenegrin community towards the EU accession to the community of peoples and economies. Therefore, Montenegro should boldly move towards development with generous but binding EU funds, which will serve generations. On this path, Montenegro for EU accession agenda needs facts, not markering”, concludes Kasalica.
The publication was produced within the programme “CSOs in Montenegro – from Basic Services to Policy Shapers – M’BASE” implemented by CCE, in partnership with the Friedrich Ebert Stiftung (FES), NGO Center for Protection and Research of Birds of Montenegro (CZIP), and NGO Politikon Network, in cooperation with the Ministry of Public Administration and the Ministry of European Affairs of the Government of Montenegro. The project is funded by the European Union and co-financed by the Ministry of Public Administration.
Nikola Obradović, Programme Assistant