DEVELOPMENT AND POVERTY REDUCTION STRATEGY DEVELOPMENT AND POVERTY REDUCTION STRATEGY Snežana Mijušković, Deputy Minister of Labour and Social Welfare, Head of the PRSP M&E Unit Thessaloniki, May 26-27, 2005 M o n t e n e g r o

Ongoing activities Development and Poverty Reduction Strategy, 2003 ( ); Development and Poverty Reduction Strategy, 2003 ( ); Realization of projects within different sectors; Realization of projects within different sectors; Strategic document referred to different problems solution – defined; Strategic document referred to different problems solution – defined; Monitoringa and evaluation system – institutionalized; Monitoringa and evaluation system – institutionalized; Establishing priorities (methodology defined and work of WGs reestablished) Establishing priorities (methodology defined and work of WGs reestablished)

Project status Over 400 projects were defined ( ) Over 400 projects were defined ( ) Financial resources planned for realization Financial resources planned for realization

Forthcoming activities Completing prioritization process (regional conference, national conference); Completing prioritization process (regional conference, national conference); Publishing data on poverty profile for 2004; Publishing data on poverty profile for 2004; Developing First Progress Report; Developing First Progress Report; Costing; Costing; Making link with budget; Making link with budget; Continuation of the monitoring and evaluation activities; Continuation of the monitoring and evaluation activities; Defining system of indicators (determining values to be reached). Defining system of indicators (determining values to be reached).

DPRS – Labor market - characteristics Employment – persons (39.9 % women) Employment – persons (39.9 % women) Unemployment Unemployment - Unemployment rate – 22.3 % - Unemployment rate – 22.3 % - Unfavorable ratio between employment and unemployment – 1:2.2 - Unfavorable ratio between employment and unemployment – 1:2.2 - Duration - Duration - Gender inequality - Gender inequality - High share of youth in unemployment - High share of youth in unemployment - Unbalance between offer and demand of labor force - Unbalance between offer and demand of labor force - Regional disharmony - Regional disharmony - Hidden employment - Hidden employment - High unemployment rate among vulnerable population - High unemployment rate among vulnerable population

DPRS – Labor Market Goals : Goals : 1. Labor legislation reform 1. Labor legislation reform 2. Stimulation of new employment 2. Stimulation of new employment 3. Development and SME sector capacity building 3. Development and SME sector capacity building

DPRS – Labor market – Labor legislation reform DPRS – Labor market – Labor legislation reform - Making prerequisites for dynamic employment growth and greater labor force mobility; - Harmonization with ILO standards and EU regulations.

DPRS – Labor market - Stimulation of new employment Stimulation of entrepreneurship Stimulation of entrepreneurship a) Increasing competence of enterprises, products and services a) Increasing competence of enterprises, products and services b) Stimulation of export b) Stimulation of export c) Creation of institutional framework for accelerated entrepreneurship development c) Creation of institutional framework for accelerated entrepreneurship development Increasing new employment Increasing new employment a) Opening new jobs a) Opening new jobs b) Legalization of hidden employment b) Legalization of hidden employment c) retraining and additional training of the unemployed and redundancies c) retraining and additional training of the unemployed and redundancies d) Substitution of the work of non-residents d) Substitution of the work of non-residents Ensuring preconditions for new, primarily foreign investment Ensuring preconditions for new, primarily foreign investment

DPRS – Labor market - Development and SME capacity building Increasing number of SMEs in private sector Increasing number of SMEs in private sector Increasing diversity among SMEs Increasing diversity among SMEs Increasing competence Increasing competence Increasing participation of SMEs in foreign strategic alliances and arrangements of joint investments Increasing participation of SMEs in foreign strategic alliances and arrangements of joint investments Increasing SMEs share in GDP Increasing SMEs share in GDP Increasing SMEs share in total employment Increasing SMEs share in total employment

DPRS – Labor market Increasing RAE employment Increasing RAE employment Increasing employment of the disabled Increasing employment of the disabled Increasing employment of refugees and IDPs Increasing employment of refugees and IDPs

DPRS – Labor Market - effects Decreased unemployment rate (2002 – 24%, 2004 – 22.3%); Decreased unemployment rate (2002 – 24%, 2004 – 22.3%); “Program on legalization of existing and new job creation”; “Program on legalization of existing and new job creation”; - Decree on tax relieves for the unemployed (tax relieves were related to persons); - Decree on tax relieves for the unemployed (tax relieves were related to persons); - Decree on labor engagement of non-residents (2.5 € per day – there were persons engaged).

DPRS – Labor market - limitations Lack of financial resources for program implementation; Lack of financial resources for program implementation; Underdeveloped monitoring mechanisms ; Underdeveloped monitoring mechanisms ; Incompatibility of sectoral policies; Incompatibility of sectoral policies; Lack of awareness of the limitations in the Budget resources; Lack of awareness of the limitations in the Budget resources; Unbalance among average wage (195.2 € – 2004), poverty line € consumer basket ( € – 2004). Unbalance among average wage (195.2 € – 2004), poverty line € consumer basket ( € – 2004).

Labor market : Policies of the Government of Montenegro “Program on continuing stimulation of new employment and entrepreneurship in Montenegro” – two credit line groups; “Program on continuing stimulation of new employment and entrepreneurship in Montenegro” – two credit line groups; “Legalization of existing and new job creation”; “Legalization of existing and new job creation”; Preparation for quality improvement of the labor force offer (training, additional training, retraining, specialization); Preparation for quality improvement of the labor force offer (training, additional training, retraining, specialization); Program on season employment; Program on season employment; Program on apprentice employment; Program on apprentice employment; Program of public works; Program of public works; Program on employment of non-residents; Program on employment of non-residents; Program on employment of the disabled; Program on employment of the disabled; Program on RAE employment; Program on RAE employment; Program on professionalne orientation. Program on professionalne orientation.

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