Digitalization in North Macedonia: Challenges and opportunities for improvement

The need for digitalization in our country was recognized in time, serious steps were taken in that direction, while awareness was raised to an enviable level.

Some of the public enterprises and private companies introduced new operating systems in the late 80’s and early 90’s: personal computers, systems for financial and material operations, etc…

The Electrical and Mechanical Faculty has always produced staff with excellent knowledge in this area or with open views towards the future and what it brings.

Powerful companies in the IT sector emerged from this, some of which still exist today and are listed solidly on world markets, as well as names that are still recognizable today as soon as they are mentioned.

During the creation of MASIT in the early 2000s, there was an initiative with the capacity to position Macedonia as a leader in the Balkans in the IT industry.

But something happened by the way, and from an enviable position, we are facing a moment in which education on the topic “Need for digitalization and what it is” should be carried out again!

The level of digitalization in the country is still relatively low, with considerable room for improvement, especially among small and medium-sized enterprises (SMEs).

For example, the public sector in Macedonia is leading the way in digitalization, with many government agencies implementing e-Government solutions to improve efficiency and transparency. Citizens can now access a wide range of public services online, such as applying for identity cards, passports and driving licenses, paying taxes and submitting various applications. In addition, the Government has launched several initiatives to promote digital skills and entrepreneurship, such as the establishment of a Center for Digital Innovation in 2018, which provides support and training to startups for small and medium-sized enterprises.

Despite the efforts in the public sector, there are still some challenges it faces in terms of digitalization. One of the biggest problems is the lack of digital infrastructure, especially in rural areas, which makes it difficult for citizens to access online services. In addition, there is a shortage of skilled IT professionals in the country, which creates an additional challenge to develop and maintain digital solutions. Maybe qualified professionals exist, but the market price of them is far above the level of the price of services that Macedonia can afford, and they provide their services to foreign markets.

In the private sector, the situation is similar. The Macedonian Government has implemented several initiatives to promote digitalization among small and medium-sized enterprises, such as providing funding and support for digitalization projects and training programs.

But obviously, taking into account the fact that especially small and medium-sized enterprises are lagging behind in terms of digitalization, the initiatives so far are insufficient.

According to a report published by the European Commission in 2020, only 9% of SMEs in Macedonia sell their products or services online, and only 22% use social media to promote their business.

This low level of digitalization is due to several factors, such as lack of awareness of the benefits of digitalization, lack of digital skills and lack of financial resources.

There is also a narrative that there are not enough funds and that quality IT solutions are too much of a financial burden for private businesses. There is still the factor of resistance to change among individuals and skepticism about the benefits of digitalization. Some companies may be reluctant to invest in digital technologies, lack digital skills themselves, or underestimate the importance of digitalization in today’s business world.

After all, it can be responsibly said that these are just excuses, while the truth is completely the opposite. If this sector continues to stick to such excuses, only those who have done exactly what is necessary will survive and instead of a stud of cars, have invested in modernization and complete digitized systematization of work.

With this in mind, the private sector is where intervention is most needed.

Small and medium-sized enterprises have a long way to go to reach the level of digitalization of large companies, to come out of the shadows and keep up with the world’s modern changes in business management.

However, any investment in digitalization of business operations and acceptance of new global trading trends (supply and demand) through digital means are solutions that will bring financial benefit and stability in the management of the existing business in the long term.

Re-education and faith in modern solutions, accepting reality, not running away from it. Conduct awareness campaigns as well as educational programs to promote the benefits of digitization and encourage as many individuals as possible to adopt it.

And very important, the digitization initiative should not be a campaign and repeated every 10 years (this comes when the tools implemented from the previous campaign have aged to the point of unusability), but should represent a constant process and culture of behavior, action and living.

The following can be said as a conclusion. Macedonia recognizes the importance of digitization and has taken steps to promote it in recent years. But despite this, there are still challenges facing both the public and private sectors, such as a lack of digital infrastructure, a lack of skilled IT professionals, and a lack of awareness of the benefits of digitization.

To overcome the mentioned challenges, it is necessary to do more in the area of promotion of digital skills as part of modern entrepreneurship and to ensure available financing and support of digitization projects.

With this approach, Macedonia would have the potential to get closer to the rest of the European countries in terms of digitization and take advantage of the benefits it brings.