Digital economy development potentials

The arrival of Union Pay International is an opportunity for the Montenegrin capital market to open important possibilities for economic diversification through the development of digital economy

With Alibaba and Baidu, China Union Pay is one of the digital giants of the Chinese economy. Their entry into our market represents a significant opportunity for the necessary modernization and diversification of economy in Montenegro and the region.

Union Pay International, a member of China Union Pay Corporation, is an international company present in 162 countries, with 1500 financial institution members and over 14 million card users. This card association with 43% of global market share, in 2015 ranked higher than its two biggest competitors - Mastercard and VISA.

During the signing of the cooperation agreement with Atlas Bank, the executive director and president of this corporation, Shi Wenchao, pointed out that cooperation between Union Pay International and Atlas bank would provide a new payment service, both for Montenegrin companies and citizens and for Chinese tourists increasingly visiting Montenegro year after year.

In addition to its significance for tourism as the crucial industry branch as pointed out by Shi Wenchao, the arrival of one of the leading digital companies from China is also significant as an incentive for Chinese companies to consider investing and conducting their business in Montenegro. Cooperation with Chinese companies on the construction of the motorway was a significant step towards establishing relations with the mighty Chinese economy. The arrival of one of the most successful Chinese international companies operating in the field of financial transactions, is also an opportunity to enhance our relations with this global economic giant. Especially considering the current Chinese initiative “One Belt, One Road”, a massive infrastructural project in which China is prepared to invest huge amounts of money and which entails the development and connection of infrastructure, or a network of roads and railroads with over 13,000 kilometres for the export of goods, as well as ports and industrial parks.

The opportunity Union Pay International refers to is that we have the chance to attract other leading companies from the international capital market as well. The arrival of those companies would mean quicker standardization and modernization, and in the world with increasingly frequent and intense changes, that would significantly reinforce our competitive position in the regional and global economy.

Platforms like Union Pay International represent also important support for the Start up businesses, giving possibility for the easy and fast integration of e-commerce and by that international payments and business transactions. Montenegrin companies will thus be in position to offer their services and products across the borders and by that approach bigger markets and enable more sustainability to innovative business initiatives, as well as add value to existing business projects.

A small and flexible economy with euro as its currency are the advantages of Montenegro, which with the strengthening of digital economy and implementation of MiFID and PSD European regulations for financial transactions could significantly increase the benefits from participating in the global economy.

By valorising these potentials, Montenegro would have the opportunity to position itself as a modern regional financial centre and thus develop and ensure new jobs in attractive digital and growing fields of financial transactions.

Also, as a country with significant investments from Eastern economies, with the development of digital economy, we would be able to position ourselves as an important link between Eastern and Western capital markets.

(Telegraf.rs/ Dr Dusko Knežević)