Accelerating Progress on Effective Tobacco Tax Policies in Low- and Middle-Income Countries: Montenegro

Montenegro is a small, Central Mediterranean country in Southeast Europe, on the Balkan Peninsula, with a coastline at the Adriatic Sea. It covers an area of 13,812 km2, with 295 km long coast and 72 km of beaches. The population counts 620,029 people (Survey of 2011). The largest city and capital of Montenegro is Podgorica, home to approximately 185,937 people or 1/3 of the country’s entire population.

The tobacco market and industry consist of: importers and exporters of tobacco, wholesalers, retailers, tobacco producers and tobacco manufacturers. Production of tobacco products (raw and final goods) has a marginal share in the structure of agricultural production in Montenegro. Until 2000, the production of tobacco had a high share of the market. But since then, the level of tobacco growing as well as cigarette production has reduced.

The reduction has occurred mainly due to the dominance of new cigarette brands that are based on a mixture of different sorts of tobacco and the 2016 liquidation of Montenegro’s main domestic producer Duvanski kombinat Podgorica (DKP) after 113 years of existence. Additionally, because of the market size, it was unprofitable for foreign investors to enter the market. Consequently, the number of households that grow raw tobacco, as well as the number of employees in the tobacco manufacturing sector, has dropped significantly.

A corresponding Policy Brief can be found here.