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Home / World

Money talks in the new Monte Carlo

By Daniel McLaughlin
17 Jul, 2007 05:00 PM3 mins to read

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The Rolling Stones play Budva. Photo / Reuters

The Rolling Stones play Budva. Photo / Reuters

KEY POINTS:

Zarko Radulovic's family were not wealthy and his two decades as a ship's captain were not lucrative, but last week the Rolling Stones stayed at his hotel and things are looking up.

He is a man of modern Montenegro, the world's youngest independent state, where glittering wealth and glamour mask poverty and corruption and a small elite is benefiting from the sale of swathes of the country to foreign tycoons and celebrities.

Radulovic's 10 floors of glass and pale stone, topped by a helicopter pad, shimmer between mountains and the Adriatic. Yet in 2005 three explosions rocked the building site and the investigator was shot dead.

"The local Mafia did it because this was the first big investment here by people who were not part of any lobby and had no 'protection'," said Radulovic in one of the hotel's bars.

Turf wars are not Budva's only worry: last month Serbian war criminal Vlastimir Djordjevic was found here after six years on the run from charges of crimes against humanity.

Businessmen show no sign of taking fright in Montenegro, however, along a coastline blessed with a balmy climate and stardust from the days when Richard Burton, Elizabeth Taylor and Sophia Loren stayed.

Twenty kilometres up the coast, Canadian gold miner Peter Munk is transforming a naval shipyard into a US$150 million ($190 million) marina complex for mega-yachts and, to the south at Velika Plaza, international investors are jostling for the right to develop a 8km-long beach.

A year after the split with Serbia, the Rolling Stones played on a Budva beach hoping that it would raise the country's profile, just as it was helped by Casino Royale, which took Daniel Craig as James Bond to Montenegro to play poker.

Catherine Zeta-Jones and Michael Douglas have been house-hunting around the walled town of Kotor, near where racing driver Ralf Schumacher bought land, along a littoral where property prices have quadrupled in four years.

Russians are now the most prominent investors. Dwarfing other private jets last week at Dubrovnik airport, 16km up the coast from Montenegro, was the Boeing 767 of Chelsea Football Club owner Roman Abramovich.

His spokesman said he was on holiday on one of his yachts. Metals magnate Oleg Deripaska, a man as rich as Abramovich, owns the aluminium smelter and bauxite mine that produce 80 per cent of Montenegro's exports.

He wants to buy a power station that provides electricity for a third of its 650,000 people, giving him control of half the nation's economy.

Nebojsa Medojevic, leader of the opposition, which has temporarily blocked the power station deal, says: "One side of the Montenegro coin is yachts, flashy cars, fancy villas, and the other side is destroyed industry, no jobs in the north, people moving to the coast for work.

"It's unsustainable. We have 320km of coastline and you can't build a luxury marina in every village."

Budva's infrastructure is sagging under the weight of tourism and illegal building, but the council found $2 million to prepare Jaz beach for the Rolling Stones, where VIPs on yachts paid $2600 to watch from the bay. At $46, even the cheapest tickets were beyond most locals' means.

"I used to dream Montenegro could one day look like Monte Carlo," said Radulovic. Now I think that in 10 years it will be better than Monte Carlo."

- OBSERVER

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