Working on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), in October 2000 GTZ began Development Cooperation with the former state union of Serbia and Montenegro. The military conflicts in the region had just ceased and the Milosevic regime had been recently ousted. The State Union of Serbia and Montenegro, which superseded the Federal Republic of Yugoslavia, was formally dissolved on 3 June 2006 following a declaration of independence by the Montenegrin Parliament. Alongside Kosovo, Montenegro is the youngest nation in the community of European peoples and one of Europe’s smaller states with a population of some 620,000 living within an area of around 14,000 square kilometres.

The Republic of Montenegro had to start anew to gain international recognition as a sovereign state and admission to international organisations. Today, Montenegro is a member state of the United Nations and of the Organisation for Security and Cooperation in Europe (OSCE), and in January 2007 became the 185th member of the International Monetary Fund (IMF) and World Bank. In July 2006, shortly after the country gained independence, the Foreign Ministers of the European Union confirmed the mandate to continue negotiations on a Stabilisation and Association Agreement with Montenegro. Prior to independence, the EU had already been pursuing a twin-track approach to take account of the differing economic policy developments in the two sub-states of the former union.

It was and still is the primary aim of German Development Cooperation to support the economic and structural reform efforts of the Government in Podgorica, in order to further stabilise the country and foster rapprochement with the EU.  On behalf of BMZ, GTZ is currently executing six programmes and projects in the “sustainable economic development” priority area. In addition, GTZ is working on behalf of the EU to assist Montenegro’s rapprochement with the European Union’s economic systems. On behalf of the Austrian Development Agency (ADA) GTZ is also executing a joint project to develop the country’s tourism infrastructure.

Since 2006 the Montenegrin economy has expanded rapidly, with foreign direct investment in the land and real estate sector rising more than tenfold since 2005. One successful example of GTZ’s activities in Montenegro is the Municipal Land Management project. Since 2004 GTZ has supported the development of legal security for investors in land and real estate and the clarification of ownership issues. The private sector now has a clear legal framework for investment. Land and property tax revenues have more than doubled, giving local authorities the funds they need to invest in the local infrastructure.

GTZ opened a Coordination Office in Podgorica in January 2007.