INTEGRATION OF DIGITAL TECHNOLOGIES BY BUSINESSES IN WESTERN BALKAN COUNTRIES

Abstract

Digitalization plays a crucial role in our daily lives, permeating every feature of our existence. At the same time the process of digitalization is viewed as one of the drivers of economic development. It has macroeconomic, sectoral, and microeconomic effects, but it may also boost regional economic cooperation. Despite its omnipresence, the global distribution of digital progress is uneven, and the Western Balkans (WB) stands as an example where digitalization remains a challenging and evolving process. Despite the involvement of numerous international and regional stakeholders, achieving digitalization in the region poses a formidable challenge. Progress requires collaborative efforts and joint problem-solving among the WB nations. The transition to digitalization should benefit everyone, contributing to the prosperity of countries capable of competing with EU members.
This paper aims to showcase the integration of digital technology in business, assessed through electronic information sharing, social media usage, advanced digital technologies, and corporate initiatives towards environmental sustainability and e-commerce. The Literature review shown that the impact of digitalisation on economic growth has been found to be mostly positive, but the impact varies depending on the degree of development of the analysed countries. The analysis relies on secondary data from State Statistical Offices in the Western Balkans and the Digital Economy Society Index for 2022. Findings reveal that in terms of digital technology integration, the WB region lags behind the EU. Montenegro exhibits the highest position in the dimension of digital technology integration, followed by Kosovo, Albania, and Serbia, all scoring above the regional average. The adoption of digital technologies by SMEs remains notably below the EU average, while successive pandemic lockdowns increasingly integrated online sales channels in the WB region.
The paper concludes that robust policies and targeted investments are vital components for expediting digital transformation, accelerating the Western Balkans into a fast-track trajectory to attain digital objectives.
Further research could explore how the intersection of digitalization and economic collaboration influences the economic advancement of Western Balkan nations. Additionally, an examination of whether varying stages of economic development among these countries result in distinct impacts from the digitalization process on economic growth would be a valuable area of investigation.