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World Travel & Tourism Council

WTTC forecasts that Montenegro will become the fastest growing travel&tourism economy in the world

REPORT FROM BERLIN- ITB 2004. The World Travel & Tourism Council (WTTC) presented the results of its economic and policy research on the…

REPORT FROM BERLIN- ITB 2004. The World Travel & Tourism Council (WTTC) presented the results of its economic and policy research on the Montenegro Travel & Tourism economy to Predrag Nenezic, Minister of Tourism, Republic of Montenegro and the Republic`s Travel & Tourism community.

The research contained economic projections for the growth of Travel & Tourism in Montenegro and a series of policy recommendations intended to maximize the potential of Travel & Tourism to the Republic`s economy and tap its position as a leading catalyst for economic development and job creation.

According to 2004 Tourism Satellite Accounting research released this week by WTTC at the London Stock Exchange, Montenegro at 10.3% real growth is expected to be the fastest growing Travel & Tourism economy (Total Travel & Tourism Demand) in the world, and WTTC believes that Montenegro is well positioned to capitalize on this opportunity to sustain its Travel & Tourism development.

At the ITB event Jean-Claude Baumgarten, WTTC`s President, said, I applaud enthusiastically Montenegro`s recent Master Planning exercise and the recent recognition by the Republic`s leadership of Travel & Tourism`s critical role in developing the economy and creating jobs across the broader economy. However, there is still an enormous amount to be done if Montenegro is to fully exploit the extraordinary growth we predict for the Republic. Critical focus should be placed on attracting foreign investors to expand and renovate the Republic`s tourism infrastructure, particularly hotel supply, as well as increasing the transparency in the privatization process, the rapid resolution of land ownership issues and the removal of red tape. Following these efforts we expect Montenegro Travel & Tourism will achieve even greater returns for their economy.

In Montenegro for 2004, WTTC is forecasting:

  • Demand: Encompassing all components of Travel & Tourism consumption, investment, government spending and exports to grow 8.2% (real terms) and total EUR322.6 million (US$ 374.2 million) in 2004. The ten-year annualized growth (2005-2014) forecast is 10.3% per annum, ranking Montenegro the number one fastest growing Travel & Tourism market in the world out of 174 countries covered by WTTC`s 2004 research.

  • Visitor Exports: Spending by inbound international visitors, the largest component of Montenegro`s Travel & Tourism demand, is expected to total EUR173.3 million, or US$201.1 million in 2004, a gain of 10.4% on 2003 results. This level represents 28.9% of total Montenegro exports.

  • Gross Domestic Product (GDP): Travel & Tourism`s contribution to the Montenegro economy is illustrated by the direct industry impact of 8.1% of total GDP and the combined direct and indirect impact of the Travel & Tourism economy expected to total 14.8% in 2004.

  • Employment: The Montenegro Travel & Tourism industry is expected to produce 500 new jobs in 2004 over its 2003 level to total 12,400 jobs or 8.1% of total employment. The broader perspective of the Travel & Tourism economy (direct and indirect), which includes the spillover employment associated with industry capital investment and government spending, is expected to create nearly 600 new jobs (590) for the Republic`s economy for a total of 22,700 jobs dependent on Travel & Tourism or 14.9% of total employment.

In order for Montenegro to realize its potential in Travel & Tourism, WTTC`s principal policy recommendations were as follows:

  • Increase the responsibility of the Ministry of Tourism, giving it direct access to the highest levels of government.

  • Encourage greater market and product diversification in order to reduce seasonality and to avoid over-dependence on mass-tourism.

  • Establish a National Convention Bureau (NCB) to manage of all MICE business for Montenegro.

  • Upgrade marketing and promotions to match prevailing competitive approaches, and ensure that the restructured National Tourism Organization is effective as a public-private sector partnership.

  • Anticipate future investment needs by introducing further incentive schemes for investment from the private sector.

  • Convene an annual National Tourism Congress, bringing together all Travel & Tourism stakeholders, to discuss challenges and opportunities for the industry.

  • Establish public-private sector liaison groups to plan ahead for the future HR development needs of the industry.

  • Continue to privatize state-owned tourism enterprises, extending privatization from hotels to other sectors of the industry, including transport.

  • Increase transparency in the privatization process and ensure that future efforts are undertaken in close co-operation with the Ministry of Tourism.

  • Resolve land ownership issues between the state, private landowners and the industry.

  • Reduce red tape and establish a stable legal framework, providing protection of investments for potential investors.

  • Set up a tourism investment facilitation agency, linked to the Ministry of Tourism, to act as a one-stop shop for potential investors.

  • Invest in the upgrading of Bar to improve ferry terminal services and to provide international standard cruise facilities and marinas.

  • Introduce special incentives for the rapid modernization of Montenegro`s hotel accommodation infrastructure.

  • Improve land-use planning and protection, guarding against illegal, uncontrolled real-estate development that poses a threat to the image and quality of Montenegro.

About the Montenegro Research – The WTTC Research for Montenegro is the latest in a series of research produced by the World Travel & Tourism Council using standard`s developed by the United Nations Statistics Commission (called Tourism Satellite Accounting) and a detailed independent policy assessment by leading Travel & Tourism analysts. Research on the Report for Montenegro began in the Fall of 2003.

Theodore Koumelis
Co-Founder & Managing Director - Travel Media Applications | Website

Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.