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Montenegro To Repeat Investigation of Ex-Officials Over Misused Gulf Loan

Montenegro’s Special State Prosecution on Wednesday said it will have to repeat questioning of ex-state officials involved in the alleged misuse of a 50-million-dollar loan to develop agriculture, stressing that there were omissions in the first investigative procedure.

In February 2021 the Special State Prosecution detained the former head of the Investment Development Fund, IRF, Zoran Vukcevic, and two others, for alleged misuse of a large loan to develop agriculture, which the Abu Dhabi Fund for Development, ADFD, was backing with 50 million US dollars.

“Due to the prosecutor’s omissions, some of the suspected were questioned without the presence of their lawyers, so the Higher Court in August ruled those evidence are invalid. The State Prosecutor’s Office has an obligation to re-examine the witnesses in the investigation and collect other necessary evidence to verify their statements,” the Special State Prosecution said.

The prosecution has charged Vukcevic, former ministers of Petar Ivanovic and Budimir Mugosa and three other persons with abuse of office.

In November 2021, parliament lifted the immunity of Ivanovic, an MP from the opposition Democratic Party of Socialists, DPS, at the request of the Special State Prosecution.

Previously, BIRN found that 23 million out of the 50 million US dollars had been handed out in loans to big companies – which failed to kickstart Montenegro’s agriculture due to administrative red tape, messy planning and the modest capacities of local communities.

In June 2015, Ivanovic, as Minister of Agriculture and Rural Development, signed the loan agreement with Mohammed Al Suwaidi, director-general of the fund, saying the money would be used to boost agriculture in the small and largely mountainous country.

Under the terms of the agreement, the 50 million US dollars would be repaid over 17 years with a grace period of four years at an interest rate of 2.5 per cent.

The loan was intended mostly for big players in the market, which could obtain 1 to 3 million dollars each.

But little wes achieved and the debts of some of the companies also increased, due to exchange rate differences, and the US dollar strengthening in value.

By mid-2017, the government had signed contracts with 11 companies for projects worth 23.2 million US dollars. But only nine of the 11 actually got any money; two were refused loans after the government conducted additional checks.

By halfway through 2020, only one of the nine companies, which got a loan to produce wooden fuel bricks, had actually started production.

The last government then decided to separate the Fund from the Agriculture Ministry and place it under the jurisdiction of a new Investment Development Fund.

The conditions for obtaining loans were also changed, so small farmers could take part as well. But information on the loans remained a secret, including the findings of internal and external auditors.

The Special Prosecutor’s office started an investigation into the use of the money in April 2019, warning of possible corruption by officials in misusing money from the loan.

Source : BalkanInsight