May 11 (SeeNews) - The European Bank for Reconstruction and Development (EBRD) affirmed on Wednesday its projection for Montenegro's 2016 economic growth at 4%, fuelled by tourism and increased private consumption.
Montengro's economy grew 3.1% last year, driven by strong FDI inflows and progress on a major Chinese-financed highway project, which will enter its full swing in 2017, the EBRD said in its latest Regional Economic Prospects report.
The tourism sector also performed well in 2015, as a drop in Russian tourists was more than offset by an increase from other countries, particularly in the Western Balkan region, the lender assessed.
"More generally, a major downside risk lies in the fiscal side, and the worrying rise in public debt in recent years may necessitate austerity measures elsewhere, especially if economic growth rates were
to falter," the EBRD noted.
Montenegro's economic growth is expected to slow to 3% in 2017, as expected post-election government spending will be tightened.