Competitiveness and sustainability in small and open economies in the age of industry 5.0

Abstract

We are living in the times of the fourth industrial revolution, which is quickly accelerating towards the fifth, which assumes that our civilization, in addition to exponential technological development, is already transforming itself through a green and human-oriented transition. In such uncertain and challenging times, the circular economy model is emerging as one of the leading economic concepts which both nations and economic blocks will focus on because it encompasses all contemporary trends of humanity, namely the care for the environment and the planet earth, the proliferation of the state-of-the-art technologies and human-centric development approach. In such global economic tendencies, the question arises as to how small and open economies should strategically position themselves in order to strengthen the competitive edge of their firms on the one hand and at the same time strengthen their own national competitiveness. This paper explores the possibilities of using the latest technologies, foremost Industry 5.0, to develop new innovative business models within the circular economy, with a special emphasis on the energy sector. The authors conclude that the use of Industry 5.0 technology is not only preferable as one of the competitiveness boosters for firms, but represents one of the must-have key success factors, especially when competing in niche segments.