Belgrade is working to develop the SAF into a small, highly-capable force, fit to participate in UN/EU peacekeeping missions, and able to defend Serbia against its security threats. As part of this transformation, much of the SAF's ageing equipment will need to be replaced, and demand for military products - particularly within the aerospace segment - is therefore significant. Serbia has a sizable defence industry, capable of producing armoured vehicles, artillery, missile systems, patrol boats and light attack aircraft, in addition to small arms and ammunition. Consequently, we expect the defence ministry to acquire much of the equipment needed for the SAF - particularly the army - from local manufacturers over the coming decade. That said, we do expect Belgrade to make arrangements for technology transfer in military import deals, which could benefit domestic defence companies over the medium-to-long term. The newly agreed Individual Partnership Action plan with NATO in January 2019 will play an important part in this – particularly with regard to the knowledge transfer of cybersecurity-related systems and practices.

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