Industry 4.0 development in Serbia

Industry 4.0, defined as smart manufacturing and supported by the Industrial Internet of Things (IIoT), is affecting the entire global production, including the Serbian industry. The fourth industrial revolution is relatively slowly (and with a serious delay compared to the most high-tech economies in Europe and the world) but steadily developing in the country according to local and international experts.

A recent publication by the independent Institute for International Politics and Economics, part of the Nizhny Novgorod Engineering-Economic University, researches the impact of Industry 4.0 and modern technologies on the economy and the modern society in Serbia.

The article notes that new technologies are not only related to smart machines and systems. “Almost all branches of the digital technology industry have been influenced by the new treatment of goods and services, which completely demolished the previous order and removed the boundaries among the branches. The best example of this is the automotive industry”, researchers comment. The automotive sector is among the main industrial branches in Serbia which shows what a huge potential impact digitization has to transform traditional production practices and also the entire economic face of this Balkan country.

A lever for innovation

Another study, published by the Ministry of education, science and technological development of the Republic of Serbia, reviewing the country’s potential and research opportunities, defines Industry 4.0 as a strong lever for innovation. Global market studies by Schwab, Gartner, Deloitte and Accenture, place among the most important technological trends in the near future, that will affect both world and Serbian industry: autonomous vehicles and robots, hyperautomation, 3D printing, artificial intelligence, advanced robotics, blockchain, extended reality, human augmentation, quantum computing, Internet of things, edge computing, Big Data, and many more.

According to the most recent Global Innovation Index, Serbia ranks as the world’s 57th economy out of 129 observed, the study shows. The annual European Innovation Scoreboard (Summary Innovation Index), published by the European Commission, also places Serbia – ranked as 30th out of 36 countries observed – as a moderate innovator in Europe, lagging behind groups of countries that fall into categories termed strong innovators and innovation leaders. However, the Innovation Index suggests that Serbia has achieved results that are ahead of the EU average in areas such as enterprises providing ICT training, SMEs innovating in-house and non-R&D innovation expenditures.

More on the topic – the Digital Adoption Index, developed by the World Bank, ranks Serbia 40th in the world (out of 183 economies), performing better in the subcategory of innovation than it does on average as measured by the Global Innovation Index.

“Serbia has also been included in the Government Artificial Intelligence Readiness Index, where it is ranked as 58th out of 194 countries globally and at a regional average, with Slovenia ranking as 38th, Bulgaria as 47th, Hungary 48th, Romania 55th, followed by North Macedonia (61), Croatia (62), Montenegro (67), and finally Albania and Bosnia and Herzegovina lagging behind as 83rd and 95th, respectively”, the research paper adds.

Development in the field of AI

The Government Artificial Intelligence Readiness Index is the only data point specific to AI that is cited in the description of the Strategy for the Development of Artificial Intelligence in the Republic of Serbia for the period 2020 – 2025. Important initiative in this field is the Serbian AI Society, founded in early 2020, including local experts and media portals. It lists seven companies from Serbia that work in the area of artificial intelligence as of January 2020. “For the sake of comparison, there are 17 AI companies listed for Bulgaria on this portal, 18 for Romania and seven for Northern Macedonia. In brief, initial desk research leads to the conclusion that Serbia’s AI business community is still relatively small but growing”, experts conclude.

The country’s developing digital ecosystem evolves both with the potential and gaps in deploying innovating technologies that form the backbone of Industry 4.0. The available literature on this topic published to date, especially in relation to the driving technologies of the Fourth Industrial Revolution and how local companies apply them to reach a higher level of productivity and growth, is scarce, analyzers point out.

Therefore, a more in-depth investigation of blockchain and artificial intelligence and related automation developments is needed in recent days, as well as studies on the application of other important technologies, such as robotics, cloud computing, extended reality, 3-D printing and others, experts comment. They recommend the Statistical Office of the Republic of Serbia should support this process by conducting wider and more regular innovation surveys, as well as by adapting its business monitoring tools. The paper further proposes that research focus is placed on companies and projects supported by the local Innovation fund.

Future prospects

Since 2015, the Faculty of Mechanical Engineering in Belgrade has conducted a large number of activities related to Industry 4.0 and its application in the country through the paradigm “Digitization of production driven by the knowledge economy”. In a recent article the academic structure informs that among the most important guidelines for the Industry 4.0 development in the country is the digital platform Industry 4.0 of Serbia, part of the Industrial Policy of Serbia 2020/2030. “It connects industry, educational and research institutions, decision makers and NGOs, on common goals of digital industry transformation”, the faculty report states. An important note is that the platform is a national strategic joint initiative of the Faculty of Mechanical Engineering in Belgrade as a representative of the Alliance Industry 4.0 Serbia, the Ministry of Economy and the Serbian Chamber of Commerce.

The expected results of the platform implementation include: acceleration of innovation and implementation of industrial solutions for Industry 4.0 in practice, a new generation of trained and highly qualified professionals (engineers and operators 4.0) and the development of a sustainable and competitive industrial system in Serbia. The main goals of the platform are: to increase the share of industry in the GDP of Serbia from the current 13% to 30% by 2030; to increase R&D investment from the current 0,6% to 1% of GDP by 2025; to increase the innovation potential and exports of domestic enterprises; to reduce standardized and low-paid work and activities in industry, with an increase in the volume of value-added products; to increase highly intellectual activities and application of ICT technologies in industry.

As key elements of this production model, used to transform traditional production into digital manufacturing, are listed: machines and devices such as cyber-physical systems, Internet of Things, cloud computing, big data analysis, artificial intelligence and machine learning. Robotics, automation, smart equipment, sensors, ERP, MES systems and other platforms for digitalizing production are also among the essential technologies in this regard.

According to a recent information by EIB Global, a dedicated instrument of the European Investment Bank, Serbia steps up innovation in virtual reality, biomedical engineering and industrial automation with new laboratories for advanced research at the University of Belgrade Innovation center in its School of electrical engineering. “By investing 200 million euro in the research and development sector in Serbia, we are proud to see such astonishing results in our joint efforts to prompt Serbian innovation, economic competitiveness and advanced technologies”, EIB summarizes.

Small and medium-sized enterprises (SMEs), researchers and students in Serbia will also be able to develop and test their products and systems with the help of modern digital technologies in a newly opened laboratory in the Science and technology park Novi Sad, the European Bank for Reconstruction and Development (EBRD) announced in September.