Corporate Thematic Areas
UNDP in Montenegro
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UNDP Europe & CIS
National Human Development Report 2013:‘People are the real wealth of the country.’ How rich is Montenegro?
Podgorica, 28 January 2013
Almost half of the Montenegrin population (42%), especially older generations, continue to believe that the state, i.e. the Government is responsible to provide for them. Even nine out of ten citizens believe that for making progress in life it is important to be well connected with people in high positions and with political powers. Majority (64%) would rather work in public sector with much lower salaries (€450), than in private sector with higher salaries (€750). Only half of the employed do the job they are educated for, but less than 5% believe they need training to be able to cope with their job duties. These are some findings of the National Human Development Report 2013: ‘People are the real wealth of the country. How rich is Montenegro?, dedicated to the topic of human capital of Montenegro. The Report was developed with financial and advisory support from the Royal Norwegian Embassy in Belgrade.
Politicians, in every country perhaps, tend to repeat that ‘people are the real wealth of their countries’. What exactly it means, how this wealth is being accumulated and utilised is always an open issue with explicit practical and political implications. This is why the latest UNDP’s National Human Development Report (NHDR) for Montenegro, examines the state of country’s human capital (who are we?) and tries to respond to what it takes to succeed in the 21st century (where are we going?).
“People are indeed the greatest wealth of Montenegro, and the main engine of its overall development. Even though Montenegro belongs to the group of countries with high level of human development, and ranks 54th in the world, we should not stop here. All the society’s endeavours need to ensure further development, in the three most important dimensions: long and healthy life, access to education and quality of life,” said H.E. Filip Vujanović, President of Montenegro in his inauguration speech at the NHDR launch.
Mr. Rastislav Vrbensky, UN Resident Coordinator and UNDP Resident Representative pointed out that on the country’s path towards EU membership, human capital will gain in its importance, as Montenegro will only be able to compete with others if it has well educated, highly skilled people. “Some of you have asked us: So, what is the conclusion? Are the people the real, the greatest wealth of Montenegro? I am personally convinced that Montenegro is a rich country and that Montenegro’s greatest wealth is not only its physical capital but its people, its human capital.” said Mr. Vrbensky.
Findings of the Report were presented by its lead author, Ms. Božena Jelušić who emphasised that the Report revealed some positive things, such as the fact that the gross national income has increased by 24 % from 2006 to 2011, and so has the life expectancy by almost a year over the last two decades. “However, the Report also shows that the education system continues to produce graduates with skills that are poorly matching labour market demands. Even though the total education expenditures keep increasing, as well as high education enrolment rate (108 % increase over 6 years), Montenegro keeps scoring lower than the average on PISA testing (Programme for International Student Assessment). Lifelong learning is an issue as the majority (87.8%) believes that once they graduate there is no need for further education.” Even 64.3% do not trust people and it is family life and health that citizens of Montenegro are the most satisfied with”, said Ms. Jelušić who also presented many interesting findings on aspirations, values and migrations.
Ms. Dragana Radević, Director of the Centre for Entrepreneurship and Economic Development, who conducted research and review of the NHDR stated that not many parents want their children to work in energy (7.4%), tourism (7.2%) or agriculture sector (6.2%) i.e. the three key development sectors of Montenegro - and she raised the question who would work in these sectors. Also surprisingly only 14.8% parents would like their children to work in private business company. Only15.3% Montenegrins believe it’s their own responsibility to provide for themselves. This, coupled with the fact that the majority of citizens would rather work in public sector, even for far lower salary, proves that the entrepreneurship and innovation culture are not well embedded in the social capital of Montenegro.”
Ms. Agima Ljajević, contributor for the health chapter, presented the key health indicators of the nation and data about citizen’s satisfaction with healthcare (5,1%, on 1-10 scale). She concluded that citizens obviously appreciate work done by medical staff as they believe that salaries of physicians should be two times higher (45.8%) and three times higher than average salary (45.6%).
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Beside the “paper version” of the Report, Atlas TV, on their initiative and with their own resources produced a unique TV edition of the National Human Development Report. The TV edition is a talk show serial comprised of twenty-seven shows “Ja imam stav” (I have an opinion) in which ordinary citizens discuss the NHDR topics. In this way, the Report reached a great number of Montenegrin homes.
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Human development and human capital
Human development promotes concept that development is about people. This concept shifts the paradigm: people are the goal of development rather than a mean to achieve development. Thus, the purpose of development is to improve the wealth of human life. To live long, quality lives we need to be well educated, to have health care and access to resources, civil and political freedoms but also opportunities to realize our potentials.
The level of development of countries is usually measured by gross national product (GNP) per capita. Instead, UNDP promotes Human Development Index (HDI) as a development measure. HDI is a composite index and in addition to GDP per capita, it measures the level of education and life expectancy (health) of the population. Measured by HDI, Montenegro belongs to the group of countries with high level of human development, and is ranked 54th in the world (HDR 2011).
Human development and human capital are two interconnected concepts. UNDP’s understanding of human capital is that it is composed not only of the employed, but also of the unemployed, the rich and the poor, children, the young and the old, as well as the ones who are still to be born.
Human capital is dynamic. Human capital traditional elements (knowledge, skills, health) represent an individual’s potential, but the extent to which this potential will (or will not) materialize depends on many other factors. Some of these factors are: experience, values, aspirations, heritage, social capital, ability to apply knowledge, ability to accommodate to the changing environment, innovativeness, entrepreneurship, risk taking, solidarity, etc. i.e. all dimensions that make us productive in both economic and non-economic terms.