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PODGORICA (Montenegro), August 2 (SeeNews) - Montenegro's government expects the country's gross domestic product (GDP) growth to slow to 3.1% in 2019 from 4.9% last year, it said on Friday.
Average annual GDP growth is forecast at 3% during the period 2020-2022, to be backed by intensified investment activity, diversification of industrial production and improvement of the fiscal position, the government said in a statement.
The debt-to-GDP ratio is expected to fall to 67% this year, from 68.3% last year, before decreasing further to 57.6% in 2022, according to the Macroeconomic and Fiscal Policy Guidelines for 2020-2022 adopted by the government on Friday.
On Thursday, Montenegro's parliament adopted a revision of the 2019 state budget and a plan for the borrowing of 500 million euro ($551.9 million) to refinance existing debt. The revision will not change the planned budget deficit equivalent to 2.97% of 2019 GDP, finance minister Darko Radunovic said.
The European Commission said in May it slightly increased its forecast for Montenegro's economic growth in 2019 - to 2.9% from 2.8% predicted in November, to be driven by construction and tourism. The increase is backed by expected growth in tourism and expansion of new industrial capacities that will favourably impact domestic demand and exports, the EU's executive body noted, adding that slower imports would result in a narrowing of the large current account gap.