Although Montenegro saw a 6.14% increase in foreign direct investment (FDI) inflows in the first half of 2025, the trend is not positive due to a 20.41% rise in outflows, resulting in a 4.15% drop in net FDI compared to the previous year. Economist Vasilije Kostic emphasises that net inflows matter more than gross figures, as capital flight can quickly destabilise small economies. A key concern is the 35% drop in investment into companies and banks, while most FDI (over €228m) went into real estate. This trend inflates property prices, raises business costs, and erodes living standards.
Kostic argues that Montenegro needs significantly more FDI in productive sectors to support development, but this requires political stability and a clear national investment strategy. The current dominance of real estate investment reflects poor planning and a lack of direction. He warns that without policy changes, the government may be forced to intervene with costly measures like subsidised housing—ultimately funded by taxpayers—to correct the imbalance.
