Montenegro’s tourism sector remains one of the strongest pillars of the national economy, but the latest OECD tourism profile shows a more demanding reality behind the headline numbers. The country is still highly attractive, still deeply dependent on foreign visitors and still capable of generating major export revenue, yet its next phase of growth will depend less on counting arrivals and more on raising value, extending the season, improving infrastructure and turning tourism into a year-round investment platform.
The central figure is striking. In 2024, travel exports accounted for 54.6% of Montenegro’s total service exports, confirming that tourism is not simply one sector among many, but the country’s main external revenue engine. Preliminary Central Bank of Montenegro data cited by the OECD estimated tourism revenues at €1.5 billion in 2024, down 3.1% compared with 2023. That decline matters because it shows that Montenegro can maintain high visitor numbers while still facing pressure on tourism yield, pricing, length of stay or spending quality. (OECD)
The volume side looked stable. Montenegro recorded 2.5 million international tourists in commercial accommodation in 2024, broadly in line with 2023, generating 15.0 million overnight stays. The top three source markets remained familiar: Serbia with 18.4%, Bosnia and Herzegovina with 8.5%, and the Russian Federation with 8.1%. Domestic tourism remained structurally weak, accounting for only 3.9% of overnight stays in commercial accommodation. (OECD)
This structure explains both Montenegro’s strength and vulnerability. The country has a powerful international tourism brand relative to its size, but it remains exposed to external demand, transport connectivity, regional income cycles, geopolitical shocks and the purchasing power of foreign visitors. A tourism economy where domestic demand accounts for such a small share of overnight stays has limited internal stabilisation when external markets soften. That makes air connectivity, border flows, regional visitor behaviour and foreign consumer sentiment unusually important for fiscal receipts, business liquidity and coastal employment.
The OECD profile also shows that policy has moved in the right direction, at least on paper. Montenegro’s tourism strategy for 2022–2025 aims to manage the sector more sustainably, build innovative, green and inclusive tourism products, increase tourist spending, reduce seasonality and narrow regional disparities. Those are the right objectives because the problem is no longer basic market visibility. Montenegro is visible. The challenge is whether tourism can generate more value per visitor, more stable employment, better regional distribution and higher productivity across the economy. (OECD)
The state has also been trying to strengthen governance. The Ministry of Tourism remains responsible for tourism policy, while the National Tourism Organisation and local tourism organisations play key roles in destination management and product development. A co-ordination body for preparation and monitoring of the season meets monthly and includes ministries, local governments, state-owned enterprises and businesses. The National Tourism Council, established in December 2022, is intended to improve standards, strengthen Montenegro’s positioning and create a more stable tourism investment environment. The 2025 tourism budget included €3.9 million for the Ministry of Tourism, €3.2 million for the National Tourism Organisation and €9.9 million for capital projects. (OECD)
The budget numbers are modest when compared with the sector’s macroeconomic weight. A tourism industry producing €1.5 billion in annual revenue cannot be managed only through promotion and seasonal coordination. It requires infrastructure finance, labour policy, energy-efficiency investment, wastewater systems, airport capacity, digital monitoring, inspection capacity and regional development planning. The public-sector budget for tourism bodies is therefore less important as a standalone number than as an indicator of how much Montenegro must rely on wider capital-budget projects, municipalities, private investors and EU-supported instruments to raise the quality of the sector.
The infrastructure question is central. Montenegro’s coast has already attracted high-end hotel, marina and real-estate investment, but congestion, seasonal pressure, road access, waste management, water systems and airport capacity remain binding constraints. The OECD notes that the 2025 Action Plan focused on institutional capacity, inspection services, coordination, digital solutions, tourism infrastructure and superstructure, product diversification, human resources, destination management and marketing. That list is broad because the bottlenecks are broad. Tourism is not only hotels and beaches; it is transport, utilities, staffing, local government capacity and the quality of public space. (OECD)
Montenegro’s fiscal and tax policy has already shaped the accommodation market. The country has positioned itself with a standard VAT rate of 21% and a competitive 15% VAT rate on hospitality services, including accommodation. It has also used incentives for four- and five-star hotel investment, including exemptions from import VAT on goods and services for five-star hotel construction, reduced real-estate property tax for year-round hotels, and exemptions from municipal land development fees for certain five-star projects. (OECD)
Those incentives changed the market. Since tax relief reforms for hotel construction were introduced in 2012, Montenegro has added 38 five-star hotels, with around 5,560 beds, and 155 four-star hotels, with around 17,400 beds. More than half of all hotels are now in the four- or five-star category, compared with less than one-quarter in 2012, when lower-category accommodation dominated the market. This is one of the clearest structural improvements in Montenegro’s tourism offer. (OECD)
But hotel quality alone does not solve the productivity problem. A country can build higher-category hotels and still struggle with seasonality, labour shortages, uneven service standards, weak inland tourism and low domestic value retention. The real test is whether higher-quality accommodation creates year-round jobs, supports local suppliers, raises spending per visitor and improves public revenue without overloading coastal municipalities. Premium hotels matter most when they are connected to broader destination management, not when they stand as isolated assets within a seasonal property cycle.
Digitalisation is becoming one of the more important reform areas. The OECD highlights the “Tourism Industry 4.0” project, implemented by the Ministry of Tourism and UNIDO, focused on digital innovation in cultural heritage, 3D digitisation and digital storytelling. The project is designed to support SMEs in tourism, culture and related industries, helping them introduce digital technologies, create higher-value products and improve competitiveness. (OECD)
The new Tourist Information System, adopted in July 2025, could be even more important from a fiscal and governance perspective. Its purpose is to enable automatic monitoring, better records, greater transparency, faster administrative processes, lower administrative burden and stronger identification of informal tourism activity. For Montenegro, this is not a technical side project. Informal accommodation, unregistered activity and weak real-time data reduce tax collection, distort competition and make destination planning harder. A functioning tourism data system can improve both policy and revenue quality. (OECD)
The green transition is another area where tourism policy and investment policy now overlap. Montenegro has launched, with EU support, a programme to establish a financial mechanism for improving energy efficiency and increasing the use of renewable energy in hotels. Priority is given to hotels operating throughout the year and to facilities in the northern region. Eligible measures include improving building energy performance, heating and cooling systems, water-heating systems, lighting, solar-powered electricity and energy-management capacity. A complementary incentive programme for catering facilities in households and rural households offers refunds of up to €20,000 per applicant. (OECD)
This matters because the next phase of tourism competitiveness will be increasingly linked to operating costs and sustainability credentials. Hotels with high energy intensity are more exposed to power-price volatility and seasonal cash-flow pressure. Energy-efficiency upgrades, rooftop solar, better cooling systems and professional energy management can reduce operating costs while making accommodation more attractive to environmentally conscious visitors, lenders and tour operators. In a country where electricity, cooling demand and summer peaks overlap, hotel decarbonisation is also part of the broader energy-system story.
The northern development agenda is the most important regional diversification theme. Montenegro has identified the tourism valorisation of the north as a strategic priority, particularly through sports infrastructure, winter tourism, recreational tourism, health tourism and nature-based tourism. Planned and ongoing projects include Žarski Ski Resort, Cmiljača Ski Resort, Štedim–Hajla Ski Resort, further modernisation of Kolašin 1600 and Savin Kuk, and the tourism-speleological valorisation of Đalovića Cave. These projects include road infrastructure, access roads, parking areas, electricity, telecommunications, water supply, wastewater systems and hospitality facilities. (OECD)
This is the correct strategic direction, but it carries execution risk. Northern tourism can reduce pressure on the coast and create a more balanced national tourism economy, yet winter and mountain projects require disciplined CAPEX planning, environmental control, climate-risk assessment, operating expertise and reliable year-round access. Ski-centre investment is particularly sensitive to snow reliability, energy costs and utilisation rates. The most bankable northern strategy is therefore not only skiing, but a wider four-season model built around mountains, lakes, caves, wellness, sport, cycling, culture, gastronomy and nature-based travel.
Montenegro’s tourism model has reached a point where policy success will be measured by depth, not visibility. The country already attracts visitors. It already has a premium coastal image. It already has high-quality hotel capacity. The weaker points are the ones that define the next investment cycle: domestic tourism is small, seasonality remains strong, revenue fell in 2024 despite stable international arrivals, and infrastructure gaps continue to limit the full value of the destination.
The OECD profile therefore reads less like a tourism promotion document and more like a competitiveness map. Montenegro’s strongest opportunity is to convert tourism from a high-season revenue engine into a broader platform for investment, energy upgrades, digital transparency, inland development and higher-value services. The sector can remain the country’s export anchor, but the model has to move further away from seasonal volume and toward measured value, better infrastructure and destinations that work beyond the peak months.
