Montenegro’s opposition URA leaves government as parliament adopts deal with Italy’s A2A

By bne IntelliNews July 31, 2016

Montenegro’s opposition United Reform Action (URA) will initiate a procedure to leave the government and cancel its agreement with the ruling Democratic Party of Socialists (DPS) after the parliament approved a new deal with Italy’s A2A on the management of power monopoly EPCG, local media reported on July 30.

URA was among several opposition parties that agreed to join the government earlier this year. The party had previously threatened to leave the government if the deal was signed in its current form, claiming it would go against Montenegro’s interests. However, A2A declined to accept the change and on July 30 the parliament adopted the agreement with the Italian company as originally proposed by the government.

Earlier in July, Deputy Prime Minister Milorad Vujovic from the opposition informed Vujica Lazovic – a deputy prime minister from the DPS - that the opposition ministers demanded an amendment to the draft agreement, according to which A2A must sell its stake in EPCG to Montenegro for €250mn if it decides to exit the company. Montenegro will be allowed to pay the sum over a period of seven years. If A2A declined to accept this change, the opposition ministers wanted the signing of the agreement to be left to the new government that would be appointed after the general elections this October.

Antena M quoted Nedeljko Rudovic, a member of URA’s coordination team, as saying that the party will initiate the procedure to leave the government as the new agreement with A2A will be against the country’s interests.

“As far as we are concerned, this [the adoption of the new deal with A2A by the parliament] means that the agreement [between the opposition and DPS] is breached. We shall very quickly call the central team, this is the sole organ of URA that can take the final decision,” Rudovic told Antena M.

The DPS and three opposition parties have signed an agreement aiming to secure fair and transparent general elections in October this year. As part of the deal, the DPS’s former coalition partner - the Social Democratic Party (SDP), URA and Demos entered the government, getting five ministerial seats. The move was seen as a step towards stabilisation of the political situation in Montenegro ahead of the general election.

Rudovic also said that URA will continue consultations with SDP and Demos, but will leave the government even if they chose to stay.

Another local media outlet, news service CDM, reported that Interior Minister Goran Danilovic, who is also the chairmen of the executive board of Demos, will most likely stay in the government to finish his job, aiming to secure transparent elections.

A2A has managed EPCG since 2009 when the Italian company acquired 43.7% of EPCG following a major privatisation deal. The Italian company paid €435mn. In the meantime, A2A has lost 2pp of its equity capital in EPCG, while the electricity price has been reduced, which resulted in A2A failing to meet pledged targets on issues such as investment.

In April 2015, A2A’s five-year management contract expired and was temporarily extended so that the two owners could agree on the terms of a new management contract. In October, Economy Minister Vladimir Kavaric said that the government and A2A had agreed on new five-year management contract.

Related Articles

UNCITRAL dismisses all CEAC's claims against Montenegro in KAP case

The United Nations Commission on International Trade Law (UNCITRAL) arbitration tribunal dismissed all claims of CEAC Holding, owned by Russian businessman Oleg Deripaska, against ... more

Montenegro’s government adopts urgent budget revision

Montenegro’s government has adopted an urgent budget revision to redirect funds for social payments due in November and December, a statement on the government’s website said on November 8. ... more

Russian nationalists planned to kill Montenegrin PM Djukanovic, prosector claims

Russian nationalists organised the alleged coup attempt on the eve of Montenegro’s October 16 general election and planned to assassinate Prime Minister Milo Djukanovic, Montenegro’s special ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss