2000/355/EC: Council Decision of 22 May 2000 providing exceptional financial assistance for Montenegro
Date: 2000-05-22
Institutions: Council of the European Union
Subjects: Montenegro, economic policy, economic recession, financial aid, terms for aid

L 127/56

EN

Official Journal of the European Communities

27.5.2000

II

(Acts whose publication is not obligatory)

COUNCIL

COUNCIL DECISION

of 22 May 2000

providing exceptional financial assistance for Montenegro

(2000/355/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 308 thereof,

Having regard to the proposal from the Commission,

(9)

Having regard to the opinion of the European Parliament (1),

Whereas:

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

The Commission has consulted the Economic and Finan-
cial Committee before submitting its proposal.

The Montenegrin Government pursues a policy of open-
ness towards the European Union and reforms towards a
well-functioning market economy.

Montenegro's overall economic situation has deteri-
orated during recent years and the Republic's budget
suffered a substantial deterioration in 1999.

In recognition of the difficult situation of the democratic
Government of Montenegro and of the severe economic
crisis afflicting the population,
the Community has
provided strong support for Montenegro in 1998 and
1999.

Montenegro's budgetary needs are expected to remain
substantial

in 2000.

The external support in the year 2000 required from
international donors is expected to be substantial.

The Republic of Montenegro is not in a position to
obtain long-term borrowing either domestically or
abroad.

The Republic of Montenegro is not eligible for member-
ship of the Bretton Woods Institutions. As a conse-
quence, the Republic of Montenegro may not benefit

from conventional International Monetary Fund (IMF) or
World Bank arrangements in support of an economic
programme.

On 23 and 24 March 2000, the European Council in
Lisbon underlined ‘... the urgent need for substantial
assistance to Montenegro in order to ensure the survival
of democratic government and to avoid another serious
crisis in the region’. Furthermore, the European Council
asked ‘...
institutions to take without
delay the necessary decisions on the funding [...] of
projects, programmes and other forms of assistance
which would help to alleviate the immediate financial
needs to Montenegro, if necessary by resorting to Euro-
pean Union budgetary reserves, as well as macroeco-
nomic assistance’.

the competent

Exceptional financial assistance from the Community in
the form of straight grants to be made available to the
Republic of Montenegro would ease the Republic's
financial constraints in the current difficult circum-
stances.

In the absence of macroeconomic monitoring and finan-
cial support from the IMF and the World Bank to the
Republic of Montenegro, particular attention should be
devoted to the proper implementation and monitoring
of this assistance. All related preparation, implementa-
tion and monitoring costs shall be covered by the assis-
tance.

(10)

(11)

(12)

The exceptional financial assistance should be managed
by the European Commission.

(1) Opinion of 18 May 2000 (not yet published in the Official Journal).

(13)

The Treaty does not provide, for the adoption of this
decision, powers other than those of Article 308,

27.5.2000

EN

Official Journal of the European Communities

L 127/57

HAS DECIDED AS FOLLOWS:

Article 3

Article 1

The Community shall make available to the Republic of
1.
Montenegro exceptional
financial assistance in the form of
straight grants of up to EUR 20 million, with a view to alle-
viating the Republic's immediate financing needs.

1.
The grant assistance shall be made available to the
Republic of Montenegro in at least two instalments on the
basis of successful completion of the economic policy condi-
tions referred to in Article 2(1). The second tranche shall not
be released before two months after the release of the first
tranche.

All related preparation, implementation and monitoring

2.
costs shall also be covered by this assistance.

2.
This assistance shall be managed by the Commission in
close consultation with the Economic and Financial Committee.

The funds shall be made available to the budget of the

3.
Republic of Montenegro.

Article 2

1.
The Commission is empowered to agree with the
Republic of Montenegro, after consultation with the Economic
the economic policy conditions
and Financial Committee,
attached to this assistance.

Article 4

The Commission shall address to the European Parliament and
to the Council an annual report, which will include an evalu-
ation on the implementation of this Decision.

Done at Brussels, 22 May 2000.

The Commission shall verify at

2.
in
consultation with the Economic and Financial Committee, that
economic policies in the Republic of Montenegro respect the
objectives and economic policy conditions of this assistance.

intervals,

regular

For the Council

The President

J. GAMA