SDG Push Insight Report

Montenegro

Montenegro
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Integrated SDG Insights

Montenegro

UNDP’s Integrated SDG Insights explore how to achieve the SDGs by 2030. So that no one is left behind.

How To Read This Report

‘SDG Insights’ playbooks transcend development “as usual,” and leverages data innovation, AI and systems analysis to chart credible pathways that help countries meet the 2030 Agenda.

SDG Moment — This section provides an overview of a country's economic growth trajectory, with new insights on sustainability and inclusiveness of growth pathways.‍

SDG Trends & Priorities — This section builds from the foundation of national SDG progress and uses machine learning to analyse national development ambition with an SDG lens.
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SDG Interlinkages — Combined, these insights are mapped against SDG interlinkages to define policy choices the accelerate SDG progress, tailored to national context.
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‍Finance & Stimulus — These policy choices are made against fiscal constraints and opportunities for stimulus mapped in this section to ensure choices translate to development impact and leave no one behind.

1. SDG Moment

While economic growth is a key element in achieving the SDGs, many countries are intent on moving beyond growth as a yardstick for progress. In the short run, growth enables the SDGs; but in the long run, the SDGs aim to transform the pattern of growth itself.

GDP Growth Pathways

People

Poverty: Percentage of the population under each threshold (PPP$ a day).

Data not available.

Planet

Carbon Intensity: CO2 emissions intensity of GDP (tCO2 per PPP $1,000).

Montenegro’s growth rates for 2023-2025 are projected to be slower than the global average and for the country before the pandemic. While this growth is expected to exert a moderately positive effect on poverty by most thresholds, it seems likely to be increasingly dependent on carbon emissions as the country’s emissions intensity of GDP is projected to increase at an annual rate of almost 2% due to growing fossil fuel usage, and of 1% when also considering land-use change.

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The European Union (EU) accession process continues to be the key priority for the country and is seen as the key driver of the country’s development and as an accelerator of the SDGs. Montenegro’s commitments to the SDGs are focused on increasing well-being for all while reducing the environmental footprint of the economy and ensuring long-term sustainability. Nearly two-thirds of SDG targets are closely linked to EU policies, especially those concerning the environment and climate change, the rule of law, freedom and security and social policy and employment. Despite significant progress over the past decade, it is predicted that if Montenegro continues at its pre-COVID growth rates, it will take nearly 40 years for the average income of Montenegrin citizens to reach average EU income levels. In order to overcome this challenge, Montenegro needs a new strategy of more sustainable growth based on productivity and increasing human capital while preserving natural resources. 

3. SDG Interlinkages

Maps synergies and trade-offs of national priorities to the most relevant SDG targets to chart policy pathways with most potential to accelerate progress.

4.4: By 2030, substantially increase the number of youth and adults who have relevant skills, including technical and vocational skills, for employment, decent jobs and entrepreneurship

In the age of rapid economic and social changes, ensuring relevant skills (Target 4.4) for youth is a crucial accelerator for the whole SDG agenda. In the Programme for International Student Assessment (PISA) 2018. Montenegro lagged Organisation for Economic Co-operation and Development (OECD) averages in reading literacy (421 vs 487), maths (430 vs 489) and in science (415 vs 489).

Investments in secondary education (Targe 4.1) and competitive skills (Target 4.3) could help young people to set out on future-proof paths which ensure employment (Target 8.6). Addressing evident differences (Target 10.1) in education (see PISA 2018) by expanding options for boys and girls and enhancing young women’s and girls’ access to science, technology, engineering and mathematics and ICT education, will contribute to women’s empowerment (Targets 5.5, 5.b).

Sustainable urbanization, including transportation services (Targets  11.1, 11.2), and targeted inclusion policies (Targets 1.3, 10.3) will contribute to improving equality of opportunities.

8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small and medium-sized enterprises, including through access to financial services

The policies for accelerated, inclusive and sustainable growth of Montenegro’s economy (Target 8.3) are fully compatible with both the EU integration agenda and the SDGs  and  can serve as powerful catalysts for growth and development. These policies are aimed at achieving faster economic growth for convergence with the EU (Target 8.1) and are  based on increased agricultural productivity (Target 2.3) and industrial productivity (Targets 9.2, 9.3).

Policies for sustainable growth also include those aimed at recognizing unpaid care and providing public care infrastructures and services (Target 5.4), enhancing women’s participation in decision-making and women’s empowerment (Target 5.5), including through STEM and ICT education (Target 5.b), and ensuring them equal rights to access and control of resources (Target 5.a).

Digitalization, which lies at the heart of these policies, requires developing quality, reliable, sustainable and resilient infrastructure, including ICT (Targets 9.1, 9.c). Economic policies aim at increasing global resource efficiency (Target 8.4), increasing energy efficiency (Targets 7.2, 7.3), and ultimately to decoupling economic growth from environmental degradation while ensuring climate resilience.

16.6. Build effective institutions and Target 16.7: Ensure responsive, inclusive, participatory and representative decision-making at all levels

Policies for achieving the SDGs require strong (Target 16.6) and inclusive (Target 16.7) institutions. Not surprisingly, SDG 16 is at the centre of both the SDGs and EU accession, particularly as concerns the judiciary and fundamental rights, and justice, freedom and security. Negotiations on accession chapters on these issues are seen as the backbone of the whole negotiation process.

These targets have broad acceleration effects through improving inequality of opportunities and thus economic inclusion (Targets 10.1, 10.3) through implementation of specific policies aimed at women’s empowerment and participation in decision-making (Target 5.5).

They are accompanied by policies aimed at reducing and redistributing unpaid care work (Target 5.4) reducing territorial inequalities (Target 11.2), promotion and protection of the human rights of the most vulnerable groups, such as Roma, children and LGBTIQ (Targets 10.3, 1.5).

16.7: Ensure responsive, inclusive, participatory and representative decision-making at all levels

15.1: By 2020, ensure the conservation, restoration and sustainableuse of terrestrial and inland freshwater ecosystems and their services.

By prioritizing Target 15.1 in its 2021-2025 National Development Plan, Ecuadorreaffirmed the significance of protecting and preserving terrestrial ecosystems andtheir biodiversity. This includes recognizing that the investment projects intendedto fulfil Target 15.1 will not only contribute to achieving the SDGs 13, 14 and 15, butwill also help restore ecosystems that underpin the availability and comprehensivemanagement of water resources (SDG 6) and promote their sustainable use (Target12.2). Additionally, it will also foster the generation of new energy from renewablesources (Target 7.2).

To this end, Ecuador seeks to strengthen the management of the National Systemof Protected Areas through its 2022-2032 Strategic Plan and the implementationof the National Forest Restoration Plan 2019-2030. These instruments serve as thetechnical, legal and financial foundation for executing local forest restorationprocesses with a landscape vision, with an overall goal of covering 30,000hectares through its projects. Considering that the proportion of national territoryunder conservation or environmental management, as of 2022, stands at 22.1%, itis necessary to mobilize additional financial resources from various sources andestablish robust governance (Target 17.3) to intensify the care of protected areas.This ensures the conservation of natural and cultural resources, genetic flows, theprovision of environmental services for the benefit of the population and thealignment of policies on the ground.

Futures Scenarios

SDG Push is a futures scenario based on 48 integrated accelerators in the areas of Governance, Social Protection, Green Economy and Digital Disruption. It uses national data to explore the impact on human development by 2030 and 2050 across key SDG indicators. It does this by using ‘International Futures,’ a systems model designed to explore interactions across development systems.

Poverty <$1.90 Per Day (Number of People)
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Malnourished Children Under 5 (Number Of Children)

Malnourished Children Under 5 (Number Of Children)

4. Finance and Stimulus

Many countries are facing reduced fiscal space, high debt levels, rising interest rates and downgrades on credit ratings. Fiscal and financial constraints tend to slow or even reverse SDG progress.

Montenegro's gross government debt, projected at 67.8% of GDP in 2023, is slightly below the emerging market and middle-income economies (EMMIE) group of 68.8%. The country is projected to collect 38.5% of GDP in revenue this year, thus nearly 1.5 times the EMMIE average of 26%.

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Montenegro's external debt servicing relative to revenue, at a projected 11.7% this year, is close to the EMMIE group’s 12.3%. Although it has recorded a decrease in public debt, Montenegro is facing a debt of €1.15 mn due in 2025. To meet these obligations, changes in fiscal policy and activities to reduce the informal economy are expected.

SDG Stimulus

The UN Secretary General’s SDG Stimulus Plan lays out a blueprint for action within the existing financial architecture. It includes:

  • Providing liquidity to support recovery in the near term
  • Enhance debt relief for vulnerable countries.​
  • Expanding development financing by MDBs
  • Align financial flows with the SDGs and Paris Agreement, according to country-level priorities and needs, for example through the rollout of the UN Integrated National Financing Framework (INFFs).

Given the projected fiscal and financial constraints faced by

Montenegro

possible funding options for the investments derived from the identified interlinkages are as follows:

  • Tax and revenue reforms, including a review of the effectiveness of tax expenditures in relation to the national development agenda to support private investments in SDG priority areas.
  • Debt for SDGs, and more specifically domestic borrowing for the Green Transition. This process may benefit more from a coherent policy support (e.g. tax incentives and other de-risking measures) to attract lending and investments to green financing (e.g. from the excessive domestic deposits).
  • Streamlining budget expenditures towards SDG-friendly sectors and budget programmes via the introduction of SDG coding into the budget information management systems.
  • Blended and public-private finance.
  • SDG-aligned business environment and investment.
  • Accessing financial markets and insurance.

Methodology & Data Sources

Click here to view the Methodological Note for the Integrated SDG Insights.

This report is the result of a global exercise carried out using artificial intelligence to identify SDG priorities based on 10 national government documents, together with SDG progress and SDG interlinkage analysis. The implementation and monitoring of the 2030 Agenda in Argentina should be consulted in the Country Reports and National Voluntary Reports.

SDG Moment

Methodology
Assesses challenges and opportunities in national growth trajectories with insights on environmental sustainability and inclusiveness.

Data Sources
Future trajectories to 2025 are based on IMF-WEO GDP projections, distributions of per capita income or consumption from the World Bank, and CO2 emissions from the Global Carbon Budget 2022 and EDGAR (JRC and IEA).​

Trends & Priorities

Methodology
SDG trends tracks progress from 2015 to date for the 231 indicators. National priorities are analysed using machine learning to reveal the most prominent SDGs referenced in national policy documents.

Data Sources
SDG trends tracks progress from 2015 to date for the 231 indicators. National priorities are analysed using machine learning to reveal the most prominent SDGs referenced in national policy documents.

Interlinkages

Methodology
SDG trends tracks progress from 2015 to date for the 231 indicators. National priorities are analysed using machine learning to reveal the most prominent SDGs referenced in national policy documents.

Data Sources
The exercise globally considered a total of 454 documents published from 2015 to August 2022. (Miola et al., 2019 updated in 2021-2022)​

Finance & Stimulus

Methodology
Provides insight into indicators of fiscal and financial stress with options (INFF) for stimulus and other means to accelerate progress.

Data Sources
Most recent resource data from UNU-WIDER GRD (between 2018 and 2021), debt and revenue from IMF WEO (between 2020 and forecasts for 2023), external debt from IDS (2023), yields from Haver Analytics (8 June 2023), credit ratings from S&P, Moodys and FITCH (2023), and DSA ratings from World Bank/IMF (31 May 2023).