Podgorica - Economy

Economy

Podgorica is not only the administrative centre of Montenegro but also its main economic engine. Most of Montenegro's industrial, financial and commercial base is in Podgorica. Before World War I, most of Podgorica's economy was in trade and small-scale manufacture – an economic model established during the long rule of the Ottoman Empire. After World War II, Podgorica became Montenegro's capital and a focus of the rapid urbanisation and industrialisation of the Yugoslav era. Industries such as aluminium and tobacco processing, textiles, engineering, vehicle production and industrialised wine production were established in and around the city. In 1981 Podgorica's GDP per capita was 87% of the Yugoslav average. The Yugoslav wars, and the dissolution of Yugoslavia left Podgorica's industries without markets, suppliers or funds to invest and modernise equipment. This led to a decline of many factories, some of which closed down. Those surviving were privatised and have now largely recovered. The Podgorica aluminium smelter (Kombinat aluminijuma Podgorica – KAP, owned by Rusal) and AD Plantaže (a wine and brandy making company) are still among the biggest companies in Montenegro.

In the early 2000s, Podgorica's financial and service sector expanded rapidly and its economy became more service-oriented. The Montenegro Stock Exchange is situated in the city, as well as most Montenegrin banks' headquarters. Economic activity in Podgorica has mostly shifted from heavy industries to telecommunications, construction and banking. Investors and foreign companies which open outlets in Podgorica add significantly to the growth and diversification of its economy. As a side effect, the prices of property and development land in the centre of Podgorica have increased greatly. The growth, although somewhat slowed down due to late 2000s recession, is expected to continue, as Podgorica became capital of an independent country in 2006.

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Famous quotes containing the word economy:

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