Montenegro has no plan to sell state property to ease debt burden – report


FILE PHOTO: Workers fit a manhole on the Bar-Boljare section of a new highway in Montenegro financed with a large Chinese loan, May 27, 2021. REUTERS/Stevo Vasiljevic/File Photo

June 13, 2021

BELGRADE (Reuters) – Montenegro has denied it has plans to sell state property to ease its debt burden, a local newspaper said on Sunday, after a Reuters report quoted senior officials as saying the tiny Balkan country was preparing the way for asset sales.

The Reuters report on Friday also quoted a senior European Union official as saying Montenegro was looking to raise cheap EU credit in a plan — to be spearheaded by state lenders from France, Germany and Italy — to reduce its financial reliance on Chinese debt.

In 2014, Montenegro, with a population of 628,000 people, borrowed $944 million from China to fund a stretch of a highway to the border with its neighbour Serbia.

The loan sent total government debt skyrocketing and it now equals 103% of economic output.

Finance Minister Milojko Spajic told Reuters in a recent interview that the government wants to make a strategic review of assets that could ultimately lead to sales, though he stressed that Montenegro’s state finances were stable.

However, the Dan daily newspaper, quoting a finance ministry official, said on Sunday there was no privatisation plan, “nor is there any need for one”.

“This government has ensured that Montenegro has the money to finance all obligations, including those to Chinese creditors,” Dan quoted the official as saying.

(Reporting by Aleksandar Vasovic; Editing by Gareth Jones)

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