The net public debt of Montenegro from independence in 2006 to the end of 2020 increased from EUR 701 million to EUR 3.53 billion, i.e. by five times or by 404%. In those 14 years, the gross domestic product (GDP) in nominal terms increased from 2.16 to 3.95 billion or by 82%, which means that the growth of the economy in that period was financed by an increase in the public debt, which grew at five times higher rates.
This is shown by data from the Ministry of Finance and the Central Bank from that period. Public debt increased by 2.8 billion, and nominal GDP by 1.8 billion.
From the beginning of 2021 to the end of last year, the nominal amount of GDP increased from 3.95 to 5.79 billion or by 46%, and the net public debt from 3.53 to 3.99 billion or by 13%. So for those two years, the net public debt as a share of GDP was reduced from 84.4 to 68.8%. This was favored by the low starting base of the GDP from 2020, which fell by 15.3% in that year due to the pandemic, but everything was compensated in the following two years.
In the public debt of 3.53 billion at the end of 2020, the debt for highway construction amounted to 640 million, while the rest was due to the growth of general public spending and some other smaller investments.
The average salary grew slightly above inflation
The average net salary in 2006 was 282 euros, but at that time the amount did not include a hot meal and the monthly part of the holiday allowance, which amounted to 63 euros. This was changed five years later when all salary payments were included in net earnings and were subject to the full amount of taxes and contributions.
So that the real net salary in 2006 amounted to 345 euros, and at the end of 2020, it was worth 527 euros, which is a nominal growth of 52.7% in 14 years. In that period, aggregate inflation, according to the standards of the Monstat Administration for Statistics, amounted to 40.6%, so that the real growth of the standard for those 14 years was only 12%.
In the period from 2006 to 2020, the amount of duties on gross wages was reduced by only 2.3%, as much as the percentage of contributions to health insurance was changed in 2019.
From the end of 2020 to March of this year, the average net salary increased from EUR 527 to EUR 781, or by 48.2%. In that period, according to Monstat, aggregate inflation was 23%, so the real value of the average salary increased by 25%. Cumulative inflation from independence to March this year was worth 72%.
