Zagreb Analysis The Digital Economy in Southeast Europe Opportunities and challenges DANIEL MONDEKAR n digital economy represents the future of economic growth in the world and the EU. It is estimated that almost the digital economy will create one million new jobs and more than 500 billion euros of new growth in EU countries by the end of 2020. With unified policies like the Digital Single Market, the EU can offer much to its citizens as well as become more competitive when compared to the US and some Asian countries. n In terms of digital societies, economy and innovation, there is a gap between Northern and Southern Europe, which can cause even deeper divides in the future with the growth of a digital industry and Work 4.0, especially in the Southeast European countries. n SEE countries are lagging behind in creating building blocks for a successful digital economy and Industry 4.0. Even though e-government projects have made substantial changes in the functioning of countries and their economies, further efforts are required at both regional and national levels in terms of taxation, social systems, labor laws, the modernization of education, support for innovation, PPP and social dialogue to prepare for Industry 4.0, the sharing economy and e-business. n Potentials for new jobs, skills and growth in the EU and SEE are huge, but whether these new economic areas will be fair in the social context remains to be seen. n In order to realize the opportunities of the digital economy in SEE, this paper presents a number of policy recommendations for regional, as well as national levels.