Montenegro’s Biggest Exporter Faces Closure

resizer124Montenegro’s biggest exporter, the KAP aluminium plant faces closure, with its foreign bank accounts blocked and an energy company threatening to seize the produced aluminium to pay off debts, according to local media.

KAP is the tiny Adriatic country’s biggest exporter, accounting for 40 percent of industrial production and generating some 10,000 jobs. Bankruptcy would severely hurt the Montenegrin economy. 

Podgorica media reports said KAP production had been halved owing to low aluminum prices, the company’s accounts had been blocked and the Russian management had departed.

The Montenegrin Energy company, EPCG, had asked a Podgorica court to block KAP access to the aluminium because of debts owed to EPCG.

EPCG later withdrew the demand, but that did not help the 3,600 KAP bauxite miners demonstrating to demand their February salaries to be paid. KAP officials said the salaries would be paid on Monday.

Russian ‘aluminum king’ Oleg Deripaska bought KAP three years ago.

Deripaska later sued the Montenegrin government for €330 million, claiming the government as a former KAP owner did not present the true economic situation of the aluminium giant.

The Montenegrin government had offered a €20 million loan to Deripaska to help him maintain production, but Deripaska rejected this.

The government has repeatedly said it will, if necessary, take over KAP again, and local analysts predicted the government would find a way to pay off workers because of upcoming elections.

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