The Financial Agreement for the 2020 Annual Action Programme for Montenegro was signed on 28 August 2020. The overall value of the programme is 31.5 million EUR, with the EU contributing 29.1 million EUR and Montenegro committing to co-finance 2.4 million EUR. The support is directed towards four key sectors:

1. In the Rule of Law and Fundamental Rights sector, the EU Rule of Law Programme (EURoL III) will receive funding of 2.5 million EUR, with no requirement for national co-financing.

2. Under the Competitiveness and Innovation, Agriculture and Rural Development sector, the EU initiative to enhance the private sector’s competitiveness and innovative capacities in Montenegro will be supported with 4.35 million EUR, which includes 4 million EUR in EU grants and 0.35 million EUR in national co-financing.

3. For the Education, Employment, and Social Policies sector, funds amounting to 14.6 million EUR are allocated for the EU initiative aimed at fostering smart and inclusive growth—specifically in employment and social inclusion for 2020. This comprises 13.5 million EUR in EU grants and 1.1 million EUR in national co-financing.

4. A total of 6.9 million EUR is allocated through direct budget support for the initiative aimed at assisting Montenegro in addressing the crisis triggered by the COVID-19 pandemic.

Activities in the Competitiveness and Innovation sector focus on improving the private sector’s and industry’s competitiveness, particularly through the development of small and medium-sized enterprises (SMEs); supporting women and youth entrepreneurship; enhancing innovation levels, especially in SMEs; and boosting administrative capacities to align with EU regulations in competitiveness and innovation.

In the Education, Employment and Social Policy sector, efforts have been made to increase employment rates among long-term unemployed individuals, particularly within vulnerable groups. Additionally, capacities to implement a sectoral approach will be reinforced, and efforts will be made to address the skills mismatch between education profiles and labor market demands.

Support for the Rule of Law and Fundamental Rights sector is designated for the third phase of the EU Support to the Rule of Law in Montenegro (EUROL III). The proposed implementation method involves grants to EU Member States, thereby providing support to institutions within this sector mainly through advisory missions from EU Member States.