Montenegro's economic system is a mixed economy combining a private sector with a public sector. What type of economic system does Montenegro have? It relies heavily on tourism, with agriculture and manufacturing also contributing. The 2026 Index of Economic Freedom scores it 63.8, ranking it 70th globally, while Freedom House rates it 68/100, Partly Free. A moderately free economy.
What is the economic system of Montenegro? The economy of Montenegro is based on a mixed economy. The country’s economic system combines elements of a market economy and a planned economy.
Montenegro’s economy is heavily reliant on tourism, with agriculture and manufacturing also playing a role. The country is working to attract foreign investment and diversify its economy.
In Montenegro, the economy is composed of a private sector, consisting of individuals and businesses that make autonomous decisions based on self-interest, and a public sector, where the state determines the production and distribution of certain goods and services. No country is purely capitalist or purely communist.
What do the freedom indexes tell about the economic system of Montenegro?
Now, to determine if a country is mostly a market economy or a planned economy, it is useful to examine some economic indexes. For instance, according to the 2026 Index of Economic Freedom, which measures the ability of every human to control his own labor and property, Montenegro is ranked 70th globally and 34th out of 44 countries in Europe, with a score of 63.8, indicating that the country has a moderately free economy.
In a similar way, the Freedom House Freedom in the World 2026 report evaluates the state of political rights and civil liberties globally. Generally, market economies tend to align more with democracy and freedom, while command economies tend to be characterized by greater state control and fewer democratic and civil liberty protections. Montenegro gets a score of 68/100, which qualifies it as Partly Free.
Montenegro is considered to have a government that does not control what people do, and people can make their own economic decisions, but it is only considered an electoral democracy, lacking full liberal democratic protections.
What do the biggest companies in Montenegro say about the country’s economic system?
The biggest company in Montenegro should also be looked at, as well as whether it is a state-owned or private company. In this case, Voli Trade is the largest company in Montenegro by revenue, generating approximately €369 million in 2024, according to Montenegrobusiness.eu. The retail chain is privately owned. Montenegro’s Electric Power Company (EPCG), a state-owned energy utility, is also among the country’s largest enterprises.
Montenegro’s private sector industries include tourism, real estate, and agriculture. The public sector industries include healthcare, education, and transportation.
The historical factors that have influenced the economic system of Montenegro
The current mixed economy system of Montenegro is the result of the transition from a socialist to a market economy, the influx of foreign investment, and the privatization of state-owned enterprises.
These changes have led to increased economic growth, increased employment, and improved living standards for Montenegrin citizens.
Sources
- List of countries by the public sector size
- ILOSTAT — Montenegro
- 2026 Index of Economic Freedom — Montenegro
- Freedom in the World 2026 — Montenegro
- Montenegrobusiness.eu — Top retail chains in Montenegro 2024
Last updated: June 20, 2026
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