A Balkan beauty; MIKE SMITH went looking for 007's Casino Royale, but instead found an intriguing country My holiday.

Byline: MIKE SMITH

AFTER a few glasses of rather fine local red wine I was drawn in a debate about which smart hotel on Montenegro's sparkling Adriatic coast was the backdrop for James Bond and Casino Royale.

Imagine the disappointment when our guide admitted while the story was set in this jewel of a Balkan country, poor old Daniel Craig never got any closer than the landlocked Czech Republic.

Undaunted, we decided we would go on our own right royal casino hunt - well, the smart bars that would be more than happy to stir, not shake, us a martini.

to The next day lounging on the sun beds next to the horizon pool at the Queen of Montenegro Hotel, overlooking that azure sea at Budva, our hearts went out to 007 for missing the chance to discovering this magnificent small stretch of the Mediterranean. To be honest he could easily afford to book into the country's latest luxury watering hotel, the island resort of Svet Stafano due for . The Mediterranean's beach, 14kms, into neighbouring. The longest around the old and its. The national Skada with . The black that gave its completion later this year.

Movie stars and royalty Movie stars are no strangers to Montenegro, although the Balkan wars of the 1990s stemmed the flow that had for generation brought the likes of Princess Margaret, Sophia Loren, Richard Burton and Kirk Douglas to what was then one of the six republics that formed Yugoslavia.

Being politically linked to Serbia after the wars, and the consequent sanctions that came with it, destroyed Montenegro's tourist industry. But now the visitors are coming back.

What see longest which stretches Albania fjord in Europe, town of Kotor neighbours park at Lake its colony of By day there are kilometres of magnificent sandy beaches, including the Med's longest beach (14kms), which reaches into neighbouring Albania. The main tourist towns have plenty of entertainment with restaurants, cafe bars and discos. Along the coastline are historic castles and monasteries, walled towns and villages with honey mountains Montenegro name coloured ramparts built from the local limestone, churches spanning the millennia and the religious divides, grand Venetian palaces and fortifications.

Trendy modern bars When it all gets too much on the feet there are trendy modern bars in the squares where locals and tourists alike while away the time people watching.

This magnificent stretch of coast runs from Albania to Croatia, and the famous town of Dubrovnik is just a three hour bus journey from Budva.

But nothing in Croatia can compare with largest "fjord" in southern Europe - really a bay with deep inlets sheltering the old maritime walled town of Kotor and its smaller neighbours.

Jaw-dropping road Move away from the coast and you are quickly in totally different worlds. A short drive from the coast is Lake Skada, one of the country's national parks, claiming Europe's last colony of pelicans with all manner of other birds.

A longer trip inland gives you a real flavour of this small nation. Between the coast and the heartland of the country is a jaw dropping road called the Serpantinas, with more hairpin bends than I cared to count culminating in a welcome stop in the village of Njegusi, where the speciality is cured ham and ewe's cheese.

Within an hour or so of leaving the warm sunshine of the Adriatic, we were up in the very black mountains that gave the country its name.

That winding road from the coast used to be the only route to the old capital, Cetinje. On the formation of Yugoslavia the capital of Montenegro moved to Titograd (now renamed Podgorica) and Cetinje has been transformed into a cultural town.

Black bears and wolves Across the way another building houses a surprising collection of art ranging from contemporary painters to the exquisite and well-travelled Christian relic Our Lady of Philerme, framed in gold and bejewelled with rubies and emeralds.

Travel further inland and you can visit virgin forests, crystal clear lakes and hiking territory in a country that still has black bears, wolves and even poisonous snakes sunning themselves on the road.

TravelFacts. Return flights from London Gatwick to Tivat from pounds 214 return with Montenegro Airlines (020 7864 4032, www.montengroairlines.com). Archers Direct (archersdirect.co.uk, 0871 423 8638) seven night Discover the Dalmatian Coast with a full day trip to Montenegro from pounds 595. A Montenegro/Croatia holiday, with seven nights in each, from pounds 929. For more information on Montenegro visit www.montenegro.travel By day the horizon Queen What sandy to see (. The Mediterranean's longest beach, 14kms, which stretches into neighbouring Albania. The longest fjord in Europe, around the old town of Kotor and its neighbours. The national park at Lake Skada with its colony of Pelicans. The black mountains that gave Montenegro its name of for this castles and coloured

CAPTION(S):

ISLAND RESORT: Svet Stafano