Investment Spotlight – Why Tivat Remains a Magnet for Tourism Capital Amidst Montenegrin Political Shifts (2023-2025)

Montenegro’s political landscape between 2023 and 2025 has certainly seen its share of dynamism, including parliamentary tensions and ongoing economic reforms. However, for the astute investor and discerning luxury property owner, the consistent flow of foreign direct investment (FDI) into Montenegro’s tourism sector, particularly in Tivat, remains a compelling story. At Royal Blue Resort and Residences, we observe this trend with keen attention, leveraging this knowledge for the benefit of our guests and stakeholders.

Despite broader political uncertainties and a slight decrease in net FDI inflows in the first half of 2024 compared to 2023, the overall trend of significant capital entering the country, particularly into high-value tourism projects, remains robust. Major developments like Porto Montenegro and Lustica Bay continue to attract substantial international capital, underscoring investor confidence in Montenegro’s high-end tourism potential. New luxury hotel brands, such as the Hyatt Regency in Kotor Bay (inaugurated in 2023) and planned Intercontinental projects, are further cementing this appeal. This sustained interest demonstrates that even amidst political shifts, the core value proposition of Montenegro’s Adriatic coast, especially the Bay of Kotor, remains incredibly strong.

The Montenegrin government’s strategic tourism development plan, aimed at improving infrastructure and diversifying offerings, further solidifies this appeal. Initiatives like the “Europe Now 2.0” program, which seeks to stimulate economic growth through wage increases and a reduced tax burden on labor, indirectly support the tourism sector by boosting domestic consumption and improving the overall economic climate.

The allure of Tivat, with its world-renowned superyacht marina (Porto Montenegro) and its increasingly well-connected international airport, positions it as a prime location for profitable tourism ventures. The ongoing discussions about legislative updates, such as the proposed introduction of a single, higher VAT rate for hospitality services from January 2025, and existing regulations around the condo-hotel model, require professional monitoring. While changes to utility infrastructure charges are always a point of discussion for developers, the strong fundamentals of Tivat’s luxury market tend to absorb these shifts.

Indeed, Tivat’s property market continues to show strong appreciation, driven by the demand for luxury waterfront developments. This indicates that despite any political noise, the underlying demand for premium experiences and properties in Tivat remains robust, making it a compelling destination for those seeking a secure and rewarding investment in the Adriatic. For Royal Blue Resort and Residences and Cielo Rooftop Bar Restaurant, this consistent investment flow not only validates our own commitment to the region but also assures our guests of Tivat’s enduring appeal as a destination of choice for luxury and leisure.