The Montenegrin government is set to establish a Fiscal Council as part of its new Fiscal Strategy for 2024-2027, aimed at enhancing oversight of how public funds are collected and spent. The move comes in response to concerns that periods of strong economic growth were not used to reduce fiscal deficits or public debt, leading to significant financial challenges during economic downturns.
The creation of the Fiscal Council, an independent advisory body, is designed to strengthen the enforcement of fiscal rules and improve the monitoring of fiscal policy and public finance management. The council will regularly report to the Montenegrin Parliament, ensuring greater transparency and accountability in the government’s financial operations.
The establishment of this council is also tied to Montenegro’s progress in meeting the economic Copenhagen criteria, which require a functioning market economy capable of withstanding competitive pressure within the European Union. Moreover, it aligns with the EU’s Directive 2011/85, which mandates that fiscal policy analyses be based on reliable and independent assessments.
As Montenegro continues its EU accession negotiations, particularly in the area of economic and monetary union, the implementation of these fiscal measures is not just a national priority but also a commitment to European standards. The initiative has been endorsed by the European Commission and the EU Council, underscoring its importance in the broader context of economic reforms in the Western Balkans. For Montenegro, which lacks its own currency and thus has limited monetary policy tools, this emphasis on fiscal discipline is crucial for maintaining economic stability.
