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The Investor Serbia 2023  I  Telecoms & IT  I  Analysis



According to data from the Statistical Office of the Republic of Serbia in 2021, the country has made significant strides in internet connectivity, with 81.4 percent of households having access to the internet, and 76.7 percent owning a computer. However, computer ownership varies across regions, with Belgrade leading the way at approximately 92.9 percent of households owning a computer. While these figures demonstrate positive trends in household connectivity, Serbian businesses have been relatively slow in adopting digital technology. For example, the adoption of cloud technology remains low, estimated at around 40 percent for companies with more than 250 employees. However, the use of e-invoices is gradually increasing and will become mandatory starting January 1, 2023.


The ICT sector in Serbia has emerged as a significant contributor to the country's economy, accounting for 10 percent of its GDP. It stands among the top four export sectors, alongside steel, cars, and agriculture. In the first quarter of 2022, there were over 3,354 firms operating within Serbia's tech sector, providing employment for 47,609 individuals, as reported by Serbia's Statistics Office. Major players in this sector include renowned U.S. companies and their affiliates. Serbian tech companies are actively involved in software development for various industries, including agriculture, medicine, tracking, cloud applications, online games, and testing. Additionally, they operate call centers and customer helplines, catering to diverse skill levels, from low-skilled positions to highly technical roles.


Serbia's startup ecosystem is gaining attention, with several successful firms either relocating to Western Europe or attracting interest from foreign buyers. Prominent examples include Nordeus, a Belgrade-based developer of the popular game "Top Eleven Football Manager," which reached the top of app store charts and was acquired by U.S. company Take-Two Interactive in June 2021. FishingBooker, often referred to as "the Airbnb of fishing trip charters," has also experienced notable success. Another standout startup is Strawberry Energy, a crowd-funded company specializing in solar-powered smart benches that provide Wi-Fi access, mobile-phone charging facilities, and information services in public venues. Strawberry Energy's products are already deployed in 23 countries.


The telecommunications and technology sector in Serbia continues to evolve, with increasing internet connectivity, a growing ICT industry, and a flourishing startup ecosystem. Despite these positive developments, there are challenges to overcome, such as the slow integration of digital technology within businesses. However, the sector shows immense potential for further growth and innovation. With favorable policies and investments in place, Serbia's telecommunications and technology sector can play a vital role in driving the country's economic development and digital transformation. Serbia's attractiveness as a destination for tech companies looking to outsource is primarily due to its high-quality ICT specialists and competitive wages. The country's workforce, characterized by low wages but high qualifications, possesses excellent English language skills and technical expertise. 


Additionally, Serbia offers investment incentives of up to €10,000 per employee, making it an appealing choice for companies. Major international players, including Microsoft, IBM, Intel, NCR, and Seven Bridges, have either established development centers and campuses in Serbia or outsourced work to local firms. While these companies offer wages more than three times higher than the country's monthly average take-home pay of €520 / $616 (2021), they remain lower than those offered in EU countries. It is worth noting, however, that the cost of developers in Serbia is rapidly increasing, although it still remains lower than in competing tech labor markets across Europe.


Despite the projected annual growth of over 20 percent in Serbia's tech sector, expansion is hindered by a shortage of skilled professionals. Foreign firms are hiring talent as quickly as the educational system can produce graduates. The domestic market of IT services has come close to the value of €300 million and is growing at an annual rate just over 10%. On the other hand, IT export amounts to €1.7 billion and recorded the growth of 30% in 2021. To achieve IT exports of €3 billion in 2023, it is expected that additional 10,000 IT experts are needed.



The telecommunications and technology sector in Serbia has undergone significant growth and transformation in recent years, playing a pivotal role in the country's economic development and digital transformation. The sector has experienced a remarkable evolution since the early 2000s, driven by political and economic changes in the region, leading to liberalization and privatization. This transition from a state-owned monopoly to a competitive market has fostered innovation, investment, and improved services, shaping the telecommunications industry in Serbia.


The Regulatory Agency for Electronic Communications and Postal Services (RATEL) governs Serbia's telecommunications sector. The regulatory framework promotes fair competition, consumer protection, and investment in infrastructure. The market is characterized by the presence of major operators, including Telekom Serbia, A1 Serbia, and Telenor Serbia, fostering a competitive environment that drives innovation and service quality.


Serbia has made significant progress in developing its telecommunications infrastructure, boasting a modern and extensive network of fiber-optic cables. This infrastructure enables high-speed broadband connectivity across both urban and rural areas, supporting the digital needs of businesses and individuals. Mobile network coverage is widespread, and the deployment of advanced 4G and 5G technologies further enhances connectivity. Ongoing investments in infrastructure development contribute to improved connectivity and ensure that Serbia remains at the forefront of digital connectivity.


Internet penetration in Serbia has witnessed substantial growth, reflecting the increasing importance of digital connectivity. The country has seen a growing number of internet users, with a significant portion accessing the internet through mobile devices. The government's "Digital Serbia" strategy aims to expand internet access, bridge the digital divide, and promote digital literacy among the population. Such initiatives ensure that all citizens have equal opportunities to participate in the digital economy and benefit from the advantages of digital connectivity.




The mobile communications sector in Serbia is vibrant and competitive, offering a wide range of services such as voice calls, data plans, messaging, and value-added services. Mobile penetration rates are high, and the adoption of smartphones is widespread among the population. The introduction of advanced mobile technologies, including 4G and 5G, paves the way for innovative services, Internet of Things (IoT) applications, and the development of smart cities. Serbia is actively pursuing digital transformation and e-government initiatives to improve public services and enhance the efficiency of government operations. By introducing e-government services, citizens and businesses can access various government services online, simplifying administrative processes and reducing bureaucracy. These efforts also aim to foster transparency, accountability, and citizen engagement, providing a more efficient and user-friendly experience for the population.


The Serbian technology sector is experiencing a surge in innovation and startup activity, with Belgrade emerging as a regional hub for startups and tech entrepreneurship. Incubators, accelerators, and innovation centers support the growth of innovative ventures, providing them with access to funding, mentorship, and business networks. The government plays a supportive role in fostering a vibrant startup ecosystem by offering various programs and initiatives to encourage entrepreneurship and innovation. 


Investments in research and development are crucial for driving innovation and technological advancement. Serbia recognizes the significance of R&D and encourages collaboration between academia, research institutions, and the private sector. Universities and educational institutions offer programs in technology-related fields, producing a skilled workforce equipped with the knowledge and expertise required for the digital era. As the digital landscape expands, ensuring cybersecurity and protecting personal data become increasingly critical. Serbia has implemented cybersecurity measures and regulations to safeguard digital infrastructure and combat cyber threats. Efforts are underway to enhance cybersecurity awareness, develop cybersecurity skills, and strengthen collaboration between public and private entities to address emerging challenges. These measures are essential for maintaining trust and security in the digital environment. The telecommunications and technology sector in Serbia holds promising prospects for further growth and innovation. The deployment of 5G networks, the expansion of IoT applications, and the emergence of emerging technologies like artificial intelligence (AI) and blockchain offer new opportunities. However, challenges such as the digital divide, skills gap, and infrastructure development in rural areas need to be addressed to ensure inclusive growth and equal access to digital services for all citizens.


The telecommunications and technology sector in Serbia has undergone remarkable development, reflecting the country's commitment to digital transformation and innovation. With a competitive market, robust infrastructure, and a supportive regulatory framework, Serbia is well-positioned to leverage emerging technologies and drive economic growth. Ongoing investments in infrastructure, research and development, and human capital development are crucial for realizing the full potential of the sector and ensuring a prosperous digital future for Serbia.



The domestic IT industry in Serbia continues to experience growth and development. In 2021, there were 3,768 active IT companies in the country, employing a total of 48,173 people. The backbone of the IT industry in Serbia is formed by small and medium-sized enterprises (SMEs). Although SMEs account for just over a fifth of the total number of IT companies, they contribute significantly to the overall business activity of the sector. In terms of income, employees, capital, and revenue, SMEs make up two-thirds of the entire IT sector in Serbia. Among the SMEs, the majority are software development companies, numbering 2,652, and representing 70% of the total number of IT companies. The field of ICT is highly dynamic and requires continuous efforts from the government to advance the regulatory framework and infrastructure. In line with this, the European Commission Progress Report for Serbia in 2021 highlighted significant developments in the digital society. The Council for Development of Digital Economy, Innovation, Hi-Tech Entrepreneurship, and Digitalization of Businesses was established, reflecting the commitment to foster a conducive environment for digital growth. Action plans have been formulated to implement the Smart Specialization Strategy of Serbia 2020-2027 and the Industrial Policy Strategy 2021-2030. These plans aim to enhance digital skills, increase the competitiveness of the Serbian industry, and promote the digitalization of business models. Additionally, efforts have been directed towards bridging the digital divide, particularly for elderly individuals and marginalized population groups.


The government's focus on the digital society and the advancement of the IT industry in Serbia is crucial to leverage the sector's potential for economic growth and innovation. Continued efforts to improve the regulatory framework, strengthen infrastructure, and enhance digital skills will foster an environment conducive to the growth of the IT industry. The thriving SME sector, particularly in software development, plays a vital role in driving the overall business activity of the IT sector. By nurturing and supporting these SMEs, Serbia can further establish itself as a competitive player in the global IT market. The IT industry in Serbia is on an upward trajectory, with a growing number of companies and a significant contribution from SMEs. 

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