Assessing Artificial Intelligence Readiness in Central Banks of the Western Balkans

This study evaluates the institutional readiness of central banks in the Western Balkans to adopt and integrate Artificial Intelligence (AI) into their operations. While AI is rapidly transforming central banking functions globally, enhancing forecasting, regulatory oversight, and operational efficiency, its adoption by central banks of the Western Balkans remains underexplored. Using a structured framework adapted from Jöhnk et al. (2021), this research assesses five key readiness dimensions: strategic alignment, resources, knowledge, organizational culture, and data infrastructure; and supplements this with additional questions to gain deeper insights into the perceived practices, expectations, benefits and risks of AI by central bankers. Insights were drawn from senior professionals across six central banks in the region. The findings reveal generally low yet uneven levels of readiness for AI adoption, with particular deficiencies in data infrastructure and the strategic integration of AI. The benefits of using AI in these central banks are widely recognized, including improvements in economic forecasting and task automation. However, key barriers persist, including institutional inertia, fragmented data systems, and a lack of internal expertise. The study emphasizes the importance of aligning AI strategies with core mandates, investing in capacity-building, and fostering regional cooperation as ways to ensure that the central banks in the region can effectively fulfil their mandated functions.