Try Harder. Findings of the European Catch-Up Index 2017

Try harder. Findings of the European Catch-Up Index 2017

Marin Lessenski

Open Society Institute – Sofia

May 2018

The Catch-Up Index 2017

About EuPI

The European Policy Initiative (EuPI) of Open Society Institute – Sofia aims to stimulate and assist new European Union Member States from Central and Eastern Europe to develop capacity for constructive co-authorship of common European policies at both government and civil society level. As a priority area of the European Policies Program of the Open Society Institute – Sofia, EuPI will contribute to improving the ability of new member states to effectively impact common European policies through good quality research, policy recommendations, networking and advocacy. The initiative operates in the ten new member states from CEE through a network of experts and policy institutes.

Web-site http://www.eupi.eu

Web-site: http://www.TheCatchUpIndex.eu

E-mail: [email protected]

Address: Open Society Institute – Sofia European Policies Initiative (EuPI) 56 Solunska Str. Sofia 1000 Tel.: (+359 2) 930 66 19 Fax: (+359 2) 951 63 48

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About the report

The report “Try Harder: Findings of the European Catch-Up Index 2017" presents the findings of the European Catch-Up Index project of the European Policies Initiative (EuPI) of the Open Society Institute- Sofia with funding provided by OSI-Sofia. This product is for non-commercial use only.

The views expressed in the report are those of the author and do not necessarily reflect the views of the Open Society Institute – Sofia.

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Contents About EuPI ...... 2 Results of the Catch-Up Index 2017 ...... 6 About the Index 2017 ...... 6 Notes on the context ...... 7 Index 2017 highlights ...... 8 Scores and ranking in Index 2017 ...... 9 The catching-up of the EU10+1: Estonia did it again ...... 11 Time and space of catching-up ...... 12 Chocolate and values: is there a paradigm change in the catching-up? ...... 13 Categories, scores and ranks: About the methodology approach ...... 16 How is Europe doing: trends in the catching-up 2011 -2017 ...... 17 Trends by Overall Score from 2011 to 2017 ...... 17 Trends in the Economy category from 2011 to 2017 ...... 19 Trends in the Quality of Life category from 2011 to 2017 ...... 20 Trends in the Democracy category from 2011 to 2017 ...... 21 Trends in the Governance category from 2011 to 2017 ...... 22 Putting the Index 2017 on the map: scores, rankings and clusters ...... 23 About the cluster analysis ...... 23 The Index 2017 results and clusters by Overall Score ...... 24 The Index 2017 results and clusters by Economy score ...... 26 The Index 2017 results and clusters by Quality of Life score ...... 28 The Index 2017 results and clusters by Democracy score ...... 30 The Index 2017 results and clusters by Governance score ...... 32 The ingredients of democracy: Methodology notes ...... 36 The catching-up of the EU10+1 countries ...... 42 EU10+1 catching-up by Overall score ...... 42 Who is who in the catching-up: comparing across the four categories ...... 44 EU10+1 catching-up in the Economy category ...... 45 The Economy category: catching-up by indicators ...... 46 The EU10+1 catching-up in the Quality of Life category ...... 51 The Quality of Life category: catching-up by indicators ...... 52

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EU10+1 catching-up in the Democracy category ...... 55 The Democracy category: catching-up by indicators ...... 56 EU10+1 catching-up in the Governance category ...... 59 The Governance category: catching-up by indicators ...... 60 EU10+1 performance by country in the Catch-Up Index 2017 ...... 64 We need to talk about the Balkans: how the candidate countries are catching-up ...... 67 The Balkans: the catching-up by country in the Index 2017 ...... 71 Supplement I: Country Scores by Indicators and Categories ...... 73 Supplement II: Country Abbreviations ...... 77 Supplement III: About the Catch Up Index. How is the “Catching-Up” Measured? ...... 78 The Economy category explained: Methodology notes ...... 79 The ingredients of democracy: Methodology notes ...... 81 Quality of Life: Methodology notes ...... 83 Governance category explained: Methodology notes...... 85 Note on data sources, timeframe and replacing missing data ...... 87 Employment as percentage of population, age group 15-64 ...... 89 Supplement IV: Methodology of the Statistical Analysis for the Catch-Up Index ...... 94 The European Catch-Up Index Project ...... 101 About the author ...... 102 About EuPI ...... 103

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Results of the Catch-Up Index 2017

About the Index 2017

The Catch Up Index measures the performance of 35 countries – the EU member states, the candidate and potential candidate countries across four categories - Economy, Quality of Life, Democracy and Governance, using 47 basic indicators. There are scores for each category and an Overall Score, composed of the scores for the four categories, based on a scale from 100 to 0, highest to lowest. The standardized scores allow for rankings the countries from 1 to 35, highest to lowest position. The primary goal of the Catch-Up Index is to measure how the newer EU member states (dubbed EU10+1) from Central and Eastern Europe are catching-up with their counterparts to the West, i.e. the older member states (dubbed EU15+2 as Malta and Cyprus are included). The candidate countries – CC – and the Potential Candidate Countries – PCC – are also included in the Index. It is easier to track catching-up in the economy, but the Index methodology allows for comparing the convergence in additional, important areas of development. In short, the Index attempts to measure the “average European levels” that the countries and citizens in the newer member states aspire to reach. The Index results can serve the broader purpose of assessing the processes of convergence and divergence in Europe across the four categories and the multiple indicators, compare countries and groups of countries and look for relationships between different factors.

This is the seventh edition of the Catch-Up Index, with the first report released in 2011 and published every year. This allows for multi-year comparisons and registering longer term trends. As the current Index is based mostly on data released in 2017 with the latest available, but not later than 31 January 2018, it is referred to as “Index 2017” though it is published in 2018 and the name convention has been applied for all previous editions of the Index.

The Index uses the term “new member states” to designate the countries of CEE that joined the EU with the fifth wave of enlargement in 2004 and 2007 and Croatia, which joined in 2013. Despite that there is considerable amount of time passed and many countries object being called “new”, there are still common characteristic and trends of these countries as a group that make studying their experience valuable.

It should also be noted that the Catch-Up Index registers performance on per capita basis, thus eliminating the size of a country (or the overall country GDP) as a factor. In case the countries have substantial intra-regional differences, they are not taken into account as it is the country average and per capita that matter in this case. The Index does not register internal country regional differences due to methodological and technical complexity, although that was considered when initially designing the Index.

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Notes on the context

The Index 2017 comes at a time when Brexit is at full swing and just a year away and has not proved to be a fundamental danger to the EU as previously thought. For all its negative consequences for both Britain and the remaining member states, it could be a wake-up call for the European citizens and politicians, presenting an opportunity to reinvigorate the EU. The initial responses show a wide array ranging from inspiring ideas for reform, to reactionary retreats or more of the same inertia. But it is clear that the recipe for EU renewal goes hand in hand with delivering more convergence and solidarity to avoid new fault lines and divisions among the EU member states.

Differences and multiple division lines in the EU exist, North and South, big and small, etc. and including those resurfacing between some former East and West governments. If we leave aside the argument whether the drive to break or weaken the EU is due to genuine sovereigntists, vested interest, driven by short-term political gain, etc. there are several lines of reasoning. For example, there is clearly mutual disappointment between at least part of the governments and societies of the former East and of the former West. Many in the former East think that this is not the same West for which they have signed up within the “return to Europe” process and want to redefine what Europe means – in terms of values, etc. On part of the West, there are accusations that some newer member states are not keeping the promises they pledged to when joining the EU.

Another school of thought is that other actual differences among EU member states cause frictions. These can be between net contributors to the budget and the rest, between debtors and creditors, between countries who think newcomers come for their jobs and those countries who feel as suppliers of labor force, while they themselves experience demographic problems. These actual differences further bring about perceptions and feelings that exacerbate the situation. Increasingly, these gaps nurture – or instrumentally used for populist mobilizations - either inferiority or superiority complexes, or relative depravation as opposed to absolute deprivation. For example, citizens in CEE countries compare themselves to their peers in the Western countries within the same club – the EU, which are by far the most prosperous, well-governed, democratic countries. This sets a very high comparison bar, which is fine as long as high benchmarks are good for better performance. But when the delivery of results is delayed or unsatisfactory, this of course brings about frustration and backlash with alternative policy solutions that see the EU rather as problem, not a solution. The key here is to find the healthy ratio between high performance benchmarks and expectations and achieving these goals in realistic timeframes. This brings full circle about the need of catching-up.

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Index 2017 highlights

. The best performers in Index 2017 are concentrated in Northwestern Europe with Denmark (1st place out of 35), Sweden (2nd), Luxemburg (3rd), the Netherlands (4th) and Finland (5th) at the top of the ranking while the underperformers are grouped in the Southeast Europe with BiH (35th place out of 35), Turkey (34th), Macedonia (33th), Albania (32nd) and Serbia (31st). . Estonia (13th overall place out of 35), the Czech Republic (14th) and Slovenia (15th) are the most successful new EU member states (EU10+1) in the catching-up process, while Bulgaria (29th), Romania (27th) and Croatia (26th) remain last in the group. . In regard to the fallout of the debt crisis in Europe, the collapse of previously crisis-hit countries such as Cyprus, Greece and Spain has stopped and at the same time Ireland has made significant progress in the rankings (8th place in 2017). . The catching-up of the EU10+1 countries with their counterparts to the West continues, with the change of scores and ranking positions from 2011 to 2017 showing that the new member states as a group are those registering biggest improvements over the years. . In general, the catching-up in the Economy remains the most successful category and Quality of Life is the worst category for the group, which includes wealth, public services as education and healthcare. This could be interpreted as failure to translate economic advancement into better standards of living. . A new trend is emerging as several EU10+1 countries – e.g. the Visegrad 4 - are converging with the older member states in the Economy category, but diverging in the Democracy category when their long-term Index results are compared. . This may signal a new East-West divide returning to Europe, in contrast in previous findings of the Index where the North-South divides were more pronounced. . It is too early to say, but this may also be a departure from the catching-up paradigm as now economic development and democracy seem to be decoupling. . There are several peculiar patterns. E.g. there seems to be a specific timeframe of catching-up as most of the changes of convergence or divergence happen until 2014 after which there is mostly normalization of the trend lines. . The Balkan countries – as the candidate countries as well as their close EU neighbors such as Bulgaria, Romania, Croatia and Greece - remain a cause for concern as they are lagging behind in nearly all four categories – Economy, Democracy, Quality of Life and Governance.

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Scores and ranking in Index 20171

Catch-Up Index 2017 Economy Quality of Life Democracy Governance Overall Score Overall Ranking Group Country Score (100-0) Score (100-0) Score (100-0) Score (100-0) (100-0) (1-35) EU15+2 Denmark 70 68 75 72 71 1 EU15+2 Sweden 69 67 74 73 71 2 EU15+2 Luxembourg 74 70 67 71 70 3 EU15+2 Netherlands 68 70 71 72 70 4 EU15+2 Finland 61 70 74 71 69 5 PCC Iceland 62 69 67 68 66 6 EU15+2 Germany 66 68 63 69 66 7 EU15+2 Ireland 68 65 66 65 66 8 EU15+2 Austria 61 66 62 68 64 9 EU15+2 UK 61 65 61 66 63 10 EU15+2 Belgium 55 66 62 61 61 11 EU15+2 France 56 65 52 57 58 12 EU10+1 Estonia 57 53 60 56 56 13 EU10+1 Czech Republic 54 55 56 55 55 14 EU10+1 Slovenia 49 60 54 56 55 15 EU15+2 Malta 54 51 56 54 54 16 EU15+2 Spain 48 53 56 55 53 17 EU15+2 Portugal 41 50 60 59 53 18 EU10+1 Lithuania 52 46 52 49 50 19 EU15+2 Cyprus 43 53 49 50 49 20 EU10+1 Poland 46 50 48 47 48 21 EU10+1 Slovakia 48 46 48 48 48 22 EU10+1 Latvia 51 42 51 47 48 23 EU15+2 Italy 43 55 50 42 47 24 EU10+1 Hungary 44 44 36 44 42 25 EU10+1 Croatia 39 44 41 41 41 26 EU10+1 Romania 42 29 40 36 37 27 EU15+2 Greece 31 46 37 33 37 28 EU10+1 Bulgaria 40 28 35 35 35 29 CC Montenegro 32 33 27 27 30 30 CC Serbia 30 26 32 28 29 31 CC Albania 29 22 26 23 25 32 CC Macedonia 36 19 19 24 24 33 CC Turkey 39 25 9 16 22 34 PCC BiH 24 18 20 13 19 35 The ranking is based on the Index 2017 Overall Scores. The scores are from 100 to 0, highest to lowest. The ranking is from 1 to 35, highest to lowest position. The groups of countries are: the EU15+2 are the fifteen old EU member states and Cyprus and Malta; the EU10+1 are the new EU member states from CEE and Croatia, which joined in 2004, 2007 and 2013. The candidate countries are designated as CC and the PCC are the potential candidate countries.

1 Disclaimer: The latest used data in the Catch-Up Index 2017 is as of 31 January 2018. Missing data was replaced using imputation procedures as explained in the supplements of this report.

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The top five performers by Overall Score in the Catch-Up Index 2017 are Denmark – 1st place with 71 points Overall Score, Sweden – 2nd place with identical score of 71 points due to minimal difference before rounding the score, Luxemburg – 3rd place with 70 points, the Netherlands – 4th place with identical score of 70 points and Finland on 5th place with 69 points, followed closely by Iceland, Germany and Ireland. All these countries are old member states - with the exception of Iceland - and are located in Northern and Northwestern Europe.

The lowest ranking countries are Bosnia and Herzegovina on the last, 35th position with 19 points by Overall Score, Turkey on 34th place with 22 points, Macedonia on 33rd place with 24 points, Albania – 32nd with 25 points and Serbia -31st place with 29 points, preceded by Montenegro, Bulgaria, Romania, Croatia and Hungary, i.e. the lowest scoring countries are candidate countries and are located in Southeastern Europe and their closest neighbors.

In regard to the performance of the newer member states (EU10+1), the best performers among them are Estonia – 13th position out of 35 with 56 points by Overall Score, the Czech Republic on 14th position with 55 points and Slovenia on 15th position with identical score of 55 points with just a small difference (before rounding the score to the decimal separator). These three countries outperform 6 out of 17 older member states. Bulgaria – 29th place with 35 points, Romania – 27th in the ranking with 37 points and Croatia – 26th with 41 points are the last three among the newer member states.

About the European Catch Up Index The Catch Up Index measures the performance of 35 countries – the EU member states, the candidate and potential candidate countries across four categories - Economy, Quality of Life, Democracy and Governance. There are scores for each category and an Overall Score, composed of the scores for the four categories. Each category is measured through selected indicators and sub-indicators. The various data for the indicators is converted into scores and weighted on the basis of the index methodology. The standardized scores make possible different rankings, comparisons, benchmarking, monitoring of performance for countries and groups of countries across categories and indicators. The metrics is based on rescaling the raw data on a scale from 0 to 100 (lowest to highest), giving the scores of a country, and positions from 1 to 35 (highest to lowest), giving the ranking of a country. The Catch-Up Index has been initially designed to capture the progress of the EU10+1 countries – the EU members from Central and Eastern Europe, including Croatia in 2013 - in catching up with the rest of the EU (EU15+2) by measuring their overall performance across the four categories – Economy, Quality of Life, Democracy and Governance. This is the seventh edition of the index, with previous editions in 2011, 2012, 2013, 2014, 2015 and 2016. As the most of the data used is from 2017, the edition is referred to as Index 2017. The Index uses the latest available where possible but not later than 31 January 2018. Missing data was replaced using imputation procedures as explained in the supplements of this report.

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The catching-up of the EU10+1: Estonia did it again

As in previous years, the champions’ trio is composed of Estonia, the Czech Republic and Slovenia on 13th, 14th and 15th position out of 35 in total with Estonia having 56 points out of 100 and the other two countries with identical scores of 55 points each. Bulgaria, Romania and Croatia are trailing behind, occupying 29th, 27th and 26th position with respectively 35, 37 and 41 points.

Estonia is also the fastest catching-up country as it advanced five positions – from 18th to 13th – when its 2017 results are compared to those in 2011, when the first Index was published. Similarly, fellow Baltic countries of Lithuania and Latvia progressed quickly by five and four positions in comparison to 2011. The Czech Republic also made considerable gains by moving three notches up in the ranking.

Romania too joined the company of catching-up countries by advancing two positions in comparison to the baseline year 2011.

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EU10+1 Catching-Up by Overall Score: Change of Scores and Ranks Overall Score Score Score Score Score Score Rank Rank Rank Overall Rank change Rank change Rank change Group Country Score change vs change vs change vs change vs change vs change vs change vs change vs change vs Rank 2017 vs 2016 vs 2015 vs 2014 2017 2016 2015 2014 2013 2012 2011 2013 2012 2011 EU15+2 Maximum 71 1 EU15+2 Average 60 EU10+1 Estonia 56 13 0 1 2 3 4 4 0 0 1 3 5 5 EU10+1 Czech Republic 55 14 0 1 1 0 0 2 1 0 1 -1 1 3 EU10+1 Slovenia 55 15 1 2 2 0 -1 -1 1 1 1 -1 -2 -2 EU10+1 Lithuania 50 19 0 1 2 3 6 5 1 0 3 3 5 5 EU10+1 Poland 48 21 -2 -3 -2 -1 -1 1 -2 -3 -3 -1 -1 1 EU10+1 Slovakia 48 22 -1 0 -1 -1 -1 1 0 0 -1 -3 -1 -1 EU10+1 Latvia 48 23 1 1 4 5 8 7 1 1 1 2 4 4 EU10+1 Hungary 42 25 0 0 -1 -2 -3 -4 0 0 0 -1 -2 -2 EU10+1 Croatia 41 26 0 0 1 0 0 0 0 0 0 0 0 0 EU10+1 Romania 37 27 1 1 3 3 2 5 1 1 3 2 1 2 EU15+2 Minimum 37 28 EU10+1 Bulgaria 35 29 1 1 0 0 0 0 0 0 0 -1 0 -1

Several countries decelerated and even regressed. Hungary has considerable drops both in the ranking and the scores and has basically ground to a halt in the last couple of years. Poland has also been steadily losing positions in the ranking. Both Hungary and Poland had a good performance initially, but then lost momentum. Slovakia is at a risk of a similar downward trajectory. Slovenia has lost both scores and ranking positions, but it is still among the top positioned countries. Bulgaria’s development is inconclusive with one step up and one step down initially, followed by stagnation in ranking with minor improvement in scores. Croatia, the new member of the club of new member state, shows stagnation in both ranking and scores.

Time and space of catching-up

There seems to be specific trends in regards to the time and geography of the catching up. The graph shows that most countries slowed down their catching-up process around 2014 – 2015 in terms of ranking and scores. Standing out from the trend are Poland, deteriorating, and Romania improving its performance.

In regard to geography, while the overall convergence with the rest of the EU is most visible from Central Europe to the Baltics – along the Estonia on the Baltic Sea through the Czech Republic and Slovenia in the Adriatic – while the Balkans are falling behind.

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However, in terms of trends, the Baltic countries, led by Estonia, has been the most dynamic in catching- up. Most Visegrad countries have started to slow down or regress, despite their initial strong showing in the Index. Romania’s achievements show ambition, but it should be watched whether it can retain its results. In contrast, the fellow Balkan neighbors of Bulgaria and Croatia have stagnated as Bulgaria moves back and forth and Croatia is at a standstill.

Chocolate and values: is there a paradigm change in the catching-up?

Oftentimes, the new EU member states reject being called “new” member states and insist that they are like any other country, that enough time has passed already since the enlargement and so this is no longer a valid distinction. At the same time, there are increasing cases, when governments and politicians from the former “East” are opposing the former “West” and observers pointing to the East- West divisions. There are indeed, differences in interests among countries and varying coalitions. Such former “East” groupings exist, especially with recent Visegrad 4 activities and the current governments

13 www.TheCatchUpIndex.eu The Catch-Up Index 2017 in Budapest and Warsaw taking the initiative. But in many cases, the role of such groupings and East- West divisions should not be overplayed as there are also small vs big states, South vs North, those in favor of more market oriented approach and austerity vs more spending. Now that the UK will be missed an alternative center to the other two big countries of France and Germany, the coalition patterns is likely to be changing too with bringing smaller states – that is the majority of CEE - often closer together.

Another part of the answer is that playing against “Brussels” pays off politically at home and accusing some external center of control is safer and beneficial in the short-term, helping political mobilization. As the populist appeal grows, so does the appeal of the tactic. Another possible answer why there are more pronounced East-West differences is that there might be an “emancipation” effect. I.e. with time politicians and governments become more experienced in EU’s internal workings, they become more confident in opposing “Brussels” or other member states.

There two current debates that seem to confirm there are divisions in the EU – regardless whether they are long-standing or a recent invention – between at least part of the “East” and part of the “West”. The first one is exemplified best by the accusations of EU member states to the East about food quality sales by big Western producers. They complain that, for example, the same brand chocolate brought to them is of lower quality and higher price than those destined for the West. The argument goes that there are no differences whatsoever in taste and consumer demands between the East and the West to justify the differences in quality. To add insult to injury, the main concern is double standards and treating the East as second class citizens, making it more about attitudes and respect than food quality dispute. A coalition of member states wants Brussels to step in, create new regulations and institutions to deal with the problem of double standards.

The second division mirrors – or better say is an identical but inverted mirror image to the problem of food quality. Western member states accuse several Eastern member states of breaching EU rule of law and common values. The Eastern counterargument is that there are unique and different enough and common norms and values are not acceptable. They want to stop “Brussels” from interfering in their affairs with an actual “Stop Brussels” campaign, perceiving outside intervention as an existential threat.

These patterns of division can broadly be reflected in the Index results. For example, when the Visegrad 4 long-term performance is compared across the two categories of Economy and Democracy, there are several specific results. Hungary is a very good performer in the Economy, advancing by 4 positions compared to 2011 and 2012 and by 2 positions compared to 2013. Likewise, Poland has advanced by 3 positions compared to 2011 and 2012, 1 position compared to 2013. The Czech Republic results are similar to that of Hungary – 4 positions compared to the start of Index and 2 positions compared to 2013. Slovakia has been advancing by only 1 position, but more steadily in scores from 2011 to 2015 each year

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But the Democracy results show divergence in the catching-up. Hungary has lost 6 positions compared to the start of the Index in 2011, dropped by 4 positions compared to 2012 and 2013, by 3 compared to 2014 and by 1 compared to 2015 and 2016. Poland’s result has worsened by 2 positions compared to 2011, a drop of 5 positions for three consequtive years - 2012, 2013 and 2014 and a record drops of 7 and 8 positions compared to 2015 and 2016. The Czech Republic has a slower regress in Democracy – 2 positions down compared to 2011, 3 compared to 2012, 1 for each year in 2014 and 2013 and by 2 in 2016. Slovakia has dropped by 1 position compared to 2011, followed by a more substantil decrease of 5, 4, 5, 5 and 6 positions each year in the period 2012 to 2016.

In a sense, this is a significant departure from the previous catching-up model, when Economy and Democracy results were synchronic and closely related, while they seem to be decopling. It should be noted that only Turkey had such model of catching-up as indicated by the previous Index results.

In addition, Governance scores in the Index 2017 for these countries in some cases have similarly decreased. Hungary and Poland has dropped by 2 positions in the ranking when the 2017 results are compared to the period 2011-2014, as well as decrease in points – from 1 to 4 in different years, but the Czech Republic and Slovakia are either respectively fluctuating or show no change.

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Categories, scores and ranks: About the methodology approach

The Catch-Up Index model is simple and is designed to assess the performance of the selected countries across the four categories. ECONOMY Each country is ascribed a score in each category, and the Overall Score is the average of those in the four categories combined. The countries are then ranked according to that score. Performance in OVERALL QUALITY the broad categories is assessed on the basis of indicators and sub- GOVERNANCE SCORE OF LIFE indicators, each having a different weight assigned to it, depending on its importance in the Catch-Up Index model. The raw data from different sources is standardized on a scale of 0 to 100 points, so DEMOCRACY that comparisons or other processing of scores can be made between countries, categories and indicators. The countries’ performance is measured relative to each another and not to external targets, because the standardization method assigns the highest score to the best performing country and vice versa. As mentioned above, the scores run on a scale from 0 (lowest) to 100 (highest), while the ranks range from 1 (highest) to 35 (lowest) – the number of countries included in the Index. The EU member states are divided into four main groups – the EU10+1 and the EU15+2, the CC – candidate countries and PCC – the potential candidate countries. The EU10+1 group includes the ten post-communist countries from Central and Eastern Europe (CEE), which joined in 2004, 2007 and Croatia in 2013. The other, the control group is the EU15+2 – the older member states plus Cyprus and Malta, which also joined in 2004 but come from a different context and path of development, and thus are closer in characteristics to the older EU members. The model uses a set of several yardsticks - or benchmarks – against which to assess the progress or lagging of the EU10+1 in meeting the standards of the rest of the EU. The benchmarks can be considered to be targets for the EU10+1. The Index takes as its main benchmark the “EU15+2 Average”, which is the mean of the scores of these countries in a given category or indicator as a component of the overall score. The average (or mean of the scores) was preferred to the median (the “middle number” in a range of scores in this case) for a number of practical reasons. The “EU15+2 Average” is a group score and does not correspond to a specific country. Sometimes, the median is also used and the corresponding score can be associated with a particular country. The other two important benchmarks are the “EU15+2 Maximum”, which is the highest score in the group and the “EU15+2 Minimum”, which is the lowest score in the EU15+2 group. Both the maximum and the minimum score can be associated with a respective country. Once the “maximum”, “average” and “minimum” are established and the countries are ranked according to their score, it can be easily observed if a particular country is above, below or near any of these benchmarks and how near or far it is to the target. Other group scores – “average” for the EU10+1, the candidates or potential candidates – can be drawn depending on the task of the comparison. The “EU15+2 Average” is the main benchmark, because the maximum may be an unrealistically high target, while setting the minimum – the lowest score – as a goal would have no motivational value.

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How is Europe doing: trends in the catching-up 2011 -2017 The Index is updated annually and since the first edition came out in 2011, based on data mostly from 2009-2010, it allows for registering changes and trends over the years up to the current Index, based on data mostly released in 2017. The section below shows tables with the information about the scores and rankings of the countries by Overall Score and the four different categories – Economy, Quality of Life, Democracy and Governance. The changes are presented in terms of differences in both the scores and the positions in the ranking comparative to the all previous editions as differences in points. The color scheme presents positive change in green – increase in score or ranking position, in red are the negative changes with decrease in score or ranking position, yellow denotes no change.

Trends by Overall Score from 2011 to 2017 The Catch-Up Index: Changes by Overall Scores 2011 - 2017

Overall Overall Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Group Country Score Rank change change vs change vs change vs change vs change change vs change vs change vs change change change vs 2016 2015 2014 2013 2012 vs 2011 2016 2015 2014 2017 2017 vs 2013 vs 2012 vs 2011 EU15+2 Austria 64 9 -1 -1 -1 -1 0 0 -1 -2 -2 -2 -2 -2 EU15+2 Belgium 61 11 0 -1 -2 -1 -1 0 0 0 -1 0 -1 0 EU15+2 Cyprus 49 20 0 -1 0 -3 -6 -7 1 0 -1 -2 -6 -6 EU15+2 Denmark 71 1 0 1 0 0 0 0 0 2 2 1 2 1 EU15+2 Finland 69 5 0 -1 -2 -1 -2 -1 0 0 -1 0 -1 0 EU15+2 France 58 12 -1 -2 -2 -3 -2 -2 0 0 0 0 0 0 EU15+2 Germany 66 7 0 -1 0 0 1 2 0 -1 -1 -1 -1 2 EU15+2 Greece 37 28 0 -1 0 -1 -4 -8 -1 -1 -1 -1 -3 -3 EU15+2 Ireland 66 8 1 2 3 3 4 1 1 1 3 2 3 0 EU15+2 Italy 47 24 1 1 0 1 0 -1 -1 -1 -1 -1 -2 -4 EU15+2 Luxembourg 70 3 0 0 -1 0 -2 -1 0 -2 -1 0 -2 -2 EU15+2 Malta 54 16 -2 -1 -1 0 -1 0 -2 -1 -3 -1 0 0 EU15+2 Netherlands 70 4 0 0 0 0 0 0 0 0 1 0 1 0 EU15+2 Portugal 53 18 2 4 4 5 3 2 0 3 2 3 1 1 EU15+2 Spain 53 17 1 1 2 0 -1 -2 0 0 0 0 0 -2 EU15+2 Sweden 71 2 0 0 -1 -1 -1 0 0 0 -1 -1 0 1 EU15+2 UK 63 10 -1 0 0 0 1 1 0 0 -1 -2 -1 0 EU10+1 Bulgaria 35 29 1 1 0 0 0 0 0 0 0 -1 0 -1 EU10+1 Croatia 41 26 0 0 1 0 0 0 0 0 0 0 0 0 EU10+1 Czech Republic 55 14 0 1 1 0 0 2 1 0 1 -1 1 3 EU10+1 Estonia 56 13 0 1 2 3 4 4 0 0 1 3 5 5 EU10+1 Hungary 42 25 0 0 -1 -3 -3 -4 0 0 0 -1 -2 -2 EU10+1 Latvia 48 23 1 1 4 5 7 7 1 1 1 2 4 4 EU10+1 Lithuania 50 19 0 1 2 3 6 5 1 0 3 3 5 5 EU10+1 Poland 48 21 -2 -3 -2 -1 -1 1 -2 -3 -3 -1 -1 1 EU10+1 Romania 37 27 1 1 3 3 2 5 1 1 3 2 1 2 EU10+1 Slovakia 48 22 -1 -1 -1 -2 -1 1 0 0 -1 -3 -1 -1 EU10+1 Slovenia 55 15 1 2 2 0 -1 -1 1 1 1 -1 -2 -2 CC Albania 25 32 2 4 4 2 5 5 1 2 3 2 3 3 CC Macedonia 24 33 -1 -3 -1 -2 -3 -3 -1 -1 0 -1 -1 -1 CC Montenegro 30 30 0 -2 -5 -4 -1 0 0 0 -2 0 0 0 CC Serbia 29 31 0 2 2 1 1 2 0 0 0 0 0 0 CC Turkey 22 34 -1 -3 -4 -3 -3 -2 0 -1 -2 -1 -1 -1 PCC BiH 19 35 1 -1 -4 -3 -4 -3 0 0 -1 0 -1 -1 PCC Iceland 66 6 0 2 2 4 3 1 0 2 2 3 2 0

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The change of scores and ranking positions from 2011 to 2017 show several main trends. First, the new member states as a group are those registering biggest improvements over the years. That is, they are catching-up with the rest. Second, the candidate countries are at a standstill and not catching-up. As they are geographically concentrated in the Southeastern Europe, this is another serious problem for the Balkans. Third, as most of the changes happen between 2011 and 2014, this may mean that the catching-up process has largely stagnated after this period.

Estonia, Latvia, Lithuania are the countries that have progressed most in the ranking and gained most in scores, especially in comparison to 2011-2014 period. Romania has joined the group of those catching- up ambitiously, but its biggest achievements come later in the process. But Hungary and Poland defy the trend as they slip down the ranking and lose points. A process which in Hungary’s case can be traced to 2011, while Poland’s performance drop is a more recent phenomenon when its 2017 results are compared to those in 2014, 2015 and 2016.

Ireland, Iceland, Portugal have been advancing too. In contrast, Italy, Cyprus and Greece have continued to deteriorate, while Spain has remained mostly unchanged after a drop when 2017 and 2011 are compared. Of the candidate countries, Albania has made a badly needed progress, especially compared to its initial showing. The drop in ranking and scores of countries such as Austria and Luxemburg can be noted, but it is not too worrying provided their otherwise strong performance in the Index.

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Trends in the Economy category from 2011 to 2017 Economy: Changes in Ranks and Scores 2011-2017 Score Economy Score Score Score Score Score Rank Rank Rank Rank Rank Rank Rank change Group Country Score change change change change change Change Change Change change change change 2017 vs 2017 vs 2016 vs 2015 vs 2013 vs 2012 vs 2011 vs 2016 vs 2015 vs 2014 vs 2013 vs 2012 vs 2011 2014 EU15+2 Austria 61 8 -1 -1 -3 -2 -2 0 0 -2 -2 -1 -1 0 EU15+2 Belgium 55 13 0 -2 -3 -1 -3 -1 0 -2 -3 -3 -3 -1 EU15+2 Cyprus 43 23 0 0 0 -6 -11 -12 0 2 0 -5 -11 -10 EU15+2 Denmark 70 2 0 1 0 2 1 2 0 0 0 1 0 1 EU15+2 Finland 61 10 0 -1 -3 -2 -4 -4 -1 -3 -5 -4 -5 -5 EU15+2 France 56 12 -1 -2 -2 -3 -2 -1 -1 -2 -3 -3 -3 -1 EU15+2 Germany 66 6 0 0 2 1 2 4 -1 -1 1 -1 0 1 EU15+2 Greece 31 32 0 0 -1 -1 -4 -9 0 0 0 2 -1 -5 EU15+2 Ireland 68 4 5 7 11 12 12 7 2 5 7 8 7 5 EU15+2 Italy 43 24 0 -2 -1 -1 -2 -3 0 -2 0 -1 -3 -2 EU15+2 Luxembourg 74 1 1 0 -1 0 -2 -1 0 0 0 0 0 0 EU15+2 Malta 54 15 0 1 3 7 3 4 -1 0 0 6 2 2 EU15+2 Netherlands 68 5 -1 0 0 1 0 -1 -2 -1 -1 -1 -1 -3 EU15+2 Portugal 41 26 -1 -2 0 -1 -3 -7 0 -2 0 0 -3 -7 EU15+2 Spain 48 20 0 -2 0 -2 -5 -7 0 -1 0 -3 -5 -5 EU15+2 Sweden 69 3 0 0 -1 0 0 2 1 0 0 -1 0 1 EU15+2 UK 61 9 -1 0 -1 -2 -1 -1 -2 -1 -1 -1 -1 -3 EU10+1 Bulgaria 40 27 0 1 1 1 1 2 0 1 2 1 1 1 EU10+1 Croatia 39 28 0 -1 0 -4 -4 -3 0 -1 0 -3 -3 -3 EU10+1 Czech Republic 54 14 1 2 3 4 4 6 1 3 0 2 4 4 EU10+1 Estonia 57 11 0 0 1 3 5 5 1 2 2 2 5 5 EU10+1 Hungary 44 22 0 1 1 1 1 3 0 1 0 2 4 4 EU10+1 Latvia 51 17 -1 -2 2 4 6 7 0 -1 0 2 5 6 EU10+1 Lithuania 52 16 0 0 2 2 5 6 0 -2 0 -1 3 5 EU10+1 Poland 46 21 -1 0 0 1 2 4 0 0 0 1 3 3 EU10+1 Romania 42 25 0 1 3 3 3 5 0 1 2 2 2 4 EU10+1 Slovakia 48 19 0 0 1 1 1 2 -1 1 1 1 1 1 EU10+1 Slovenia 49 18 0 -1 0 -3 -5 -7 1 0 -1 -4 -5 -4 CC Albania 29 34 0 0 -2 -3 -1 2 -1 -1 -1 -1 0 1 CC Macedonia 36 30 0 0 1 1 1 3 0 0 1 1 0 3 CC Montenegro 32 31 -1 0 -10 -7 -3 -2 0 0 -6 -2 1 1 CC Serbia 30 33 1 3 -1 -2 -3 -3 1 1 1 -1 0 -2 CC Turkey 39 29 2 0 1 2 1 3 0 0 1 1 0 1 PCC BiH 24 35 0 -2 -5 -7 -2 -4 0 0 0 0 0 -1 PCC Iceland 62 7 2 4 5 5 8 3 3 5 5 4 7 3

The majority of countries, which register higher ranking and scores are concentrated in the EU10+1 group. I.e. the majority of new member states are catching-up with their counterparts. Ireland and Iceland have been making substantial advancements.

The most serious regress in the longer-term is registered by Cyprus, Greece, Portugal, Spain, Italy, France, Belgium, and Finland though in many cases the decrease is registered up to 2014 and after this there is either a standstill or slight improvement. The two neighbors of Slovenia and Croatia are underperforming and thus breaking from the CEE trend of improvement over the years.

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Trends in the Quality of Life category from 2011 to 2017 Quality of Life: Change in Ranks and Scores 2011-2017

Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Score Rank Group Country change vs change change change change vs change vs Change vs Change vs Change vs change change change 2017 2017 2016 vs 2015 vs 2014 vs 2013 2012 2011 2016 2015 2014 vs 2013 vs 2012 vs 2011 EU15+2 Austria 66 9 0 0 1 1 1 1 1 -1 2 0 0 0 EU15+2 Belgium 66 8 0 0 0 0 0 1 0 -1 -1 -1 -1 2 EU15+2 Cyprus 53 17 0 -2 -2 -4 -6 -5 -1 -2 -2 -2 -4 -3 EU15+2 Denmark 68 6 0 2 2 2 1 1 -1 3 2 2 0 0 EU15+2 Finland 70 2 0 0 0 -1 -1 0 1 1 1 0 0 1 EU15+2 France 65 11 0 1 0 0 1 0 0 0 -2 -1 -1 -3 EU15+2 Germany 68 5 1 0 -1 1 2 4 1 -1 -1 1 3 6 EU15+2 Greece 46 22 -1 0 0 -3 -8 -10 0 0 -1 -2 -5 -5 EU15+2 Ireland 65 12 0 1 1 0 0 -1 0 0 0 -1 -1 -5 EU15+2 Italy 55 15 0 0 0 0 -2 -3 0 1 1 1 0 -2 EU15+2 Luxembourg 70 1 -1 -1 -1 0 0 -1 0 0 0 3 2 0 EU15+2 Malta 51 19 0 0 0 -3 0 1 0 0 -1 -2 0 0 EU15+2 Netherlands 70 3 -1 -1 -1 -2 -2 -1 -1 -1 -1 -2 -2 -1 EU15+2 Portugal 50 20 1 2 4 4 3 3 0 1 2 3 3 1 EU15+2 Spain 53 16 1 1 1 1 -1 -4 2 1 1 2 2 0 EU15+2 Sweden 67 7 -1 0 -1 -3 -2 -1 -3 -1 -2 -4 -3 -2 EU15+2 UK 65 10 0 0 0 3 3 2 -1 0 0 2 2 2 EU10+1 Bulgaria 28 30 -1 -1 -1 0 -2 -2 -1 0 0 0 1 0 EU10+1 Croatia 44 26 1 0 1 2 3 0 0 0 0 0 -1 -1 EU10+1 Czech Republic 55 14 -1 -1 -1 -3 0 2 0 -1 0 -1 2 4 EU10+1 Estonia 53 18 -1 1 2 5 4 4 -1 0 1 3 2 2 EU10+1 Hungary 44 25 0 0 0 0 -4 -4 0 0 0 0 -4 -3 EU10+1 Latvia 42 27 1 0 3 5 7 6 0 0 0 0 0 0 EU10+1 Lithuania 46 24 0 0 0 1 7 5 0 -1 0 0 2 2 EU10+1 Poland 50 21 0 1 0 2 2 4 0 -1 -1 1 3 2 EU10+1 Romania 29 29 1 -1 0 1 -3 2 1 0 0 2 1 2 EU10+1 Slovakia 46 23 0 2 0 -3 -1 1 0 1 0 -4 -1 1 EU10+1 Slovenia 60 13 0 4 1 3 2 2 0 1 0 1 1 2 CC Albania 22 33 1 4 5 2 1 0 1 2 2 2 1 0 CC Macedonia 19 34 -3 -4 -4 -4 -5 -6 -1 -1 -1 -1 -2 -2 CC Montenegro 33 28 0 -4 -4 0 0 2 0 0 0 0 1 1 CC Serbia 26 31 -1 3 1 -4 -7 -6 0 1 1 -2 -3 -3 CC Turkey 25 32 0 -2 -3 1 3 3 0 -1 -1 0 1 2 PCC BiH 18 35 1 -4 -4 -3 -1 0 0 -1 -1 -1 0 0 PCC Iceland 69 4 2 1 1 2 2 0 3 1 2 1 1 0

The Quality of Life results show stagnation across all groups of countries. The only improvements – and they are limited in time and scope - are registered by Germany, Denmark, Spain, Portugal in the old members club. Several new members - the Czech Republic, Estonia, Poland, Lithuania, and Slovenia – also have some improvements in varying degrees. Albania and Iceland too have progressed when their previous results are compared.

Cyprus, France, Greece are among the countries, which experienced decrease in their Quality of Life performance, and to a lesser extent Ireland, the Netherlands and Sweden, but they still stay enviably ahead in the ranking. Among the new member states only Hungary has slipped down substantially the ranking and lost points when the 2017 results are compared to 2011 and 2012. Macedonia and Serbia have also lost points and slipped down the ranking.

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Trends in the Democracy category from 2011 to 2017 Democracy: Change in Ranks and Scores 2011-2017

Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Democracy Rank Group Country change vs change change change change vs change vs Change vs Change vs Change vs change change change Score 2017 2017 2016 vs 2015 vs 2014 vs 2013 2012 2011 2016 2015 2014 vs 2013 vs 2012 vs 2011

EU15+2 Austria 62 9 -2 -2 -2 -3 3 0 -1 0 0 -3 1 0 EU15+2 Belgium 62 10 0 -1 -2 -1 2 0 0 0 0 0 -1 0 EU15+2 Cyprus 49 22 2 3 5 1 -1 -3 2 2 1 0 0 -3 EU15+2 Denmark 75 1 1 3 2 0 4 2 0 1 1 0 2 1 EU15+2 Finland 74 3 1 1 1 0 -2 2 0 0 0 0 -2 1 EU15+2 France 52 19 0 -6 -4 -5 -3 -5 1 -7 -5 -6 -5 -6 EU15+2 Germany 63 8 0 -2 -1 -2 1 -1 1 0 0 -1 0 0 EU15+2 Greece 37 27 3 -3 1 2 -1 -6 1 -1 0 0 0 -1 EU15+2 Ireland 66 7 0 1 1 2 3 0 0 0 0 2 0 0 EU15+2 Italy 50 21 1 2 0 6 4 3 1 1 1 2 2 3 EU15+2 Luxembourg 67 6 0 -1 -3 -4 -2 -2 0 -1 -1 -1 -1 -1 EU15+2 Malta 56 14 -4 -2 -2 1 3 0 -2 0 -1 1 3 1 EU15+2 Netherlands 71 4 0 0 0 -1 2 -1 0 0 0 0 0 -1 EU15+2 Portugal 60 12 6 9 8 8 9 7 4 9 8 7 8 6 EU15+2 Spain 56 15 1 1 3 1 2 1 2 2 2 1 0 1 EU15+2 Sweden 74 2 1 0 0 -1 2 -1 0 -1 -1 0 0 -1 EU15+2 UK 61 11 0 -1 -1 -2 3 2 0 0 0 0 1 0 EU10+1 Bulgaria 35 29 3 1 -1 1 -1 1 1 0 -1 -1 0 -1 EU10+1 Croatia 41 25 -1 -1 0 -1 -2 0 0 0 1 0 0 2 EU10+1 Czech Republic 56 16 -1 0 0 -1 -1 -1 -2 -1 -1 -2 -3 -2 EU10+1 Estonia 60 13 1 1 0 1 1 2 0 0 -1 -1 -2 -1 EU10+1 Hungary 36 28 -2 -1 -5 -6 -9 -15 -1 -1 -3 -4 -4 -6 EU10+1 Latvia 51 20 2 4 8 11 10 7 3 3 4 6 6 5 EU10+1 Lithuania 52 18 0 0 1 3 2 1 3 0 3 3 3 2 EU10+1 Poland 48 23 -6 -7 -4 -4 -5 -3 -8 -7 -5 -5 -5 -2 EU10+1 Romania 40 26 2 4 6 7 5 9 0 2 3 3 2 3 EU10+1 Slovakia 48 24 -6 -4 -4 -3 -4 -1 -6 -5 -5 -4 -5 -1 EU10+1 Slovenia 54 17 1 3 1 0 0 0 2 3 -1 0 -1 0 CC Albania 26 32 4 7 4 7 6 11 0 1 0 2 2 2 CC Macedonia 19 34 -1 -1 0 -4 -8 -7 -1 -2 0 -2 -2 -2 CC Montenegro 27 31 1 -3 -3 -6 -5 -2 0 0 -1 -1 -1 -1 CC Serbia 32 30 -1 -2 3 4 2 6 -1 0 1 1 1 1 CC Turkey 9 35 -1 -2 -4 -5 -10 -5 0 0 0 0 0 0 PCC BiH 20 33 5 3 0 -1 -2 0 1 1 0 0 0 0 PCC Iceland 67 5 -2 2 0 3 2 1 0 1 1 3 1 1

In general, progress in the Democracy category is very limited. Only Portugal, Latvia, Lithuania and Romania have registered substantial progress and there is limited improvement by Cyprus, Italy, Spain, Slovenia and Albania. Several countries have regressed considerably. France’s performance worsened compared to those in the period 2011-2015 with slight improvement in comparison to 2016. Hungary has tanked both in the ranking and lost points continuously from 2011 to 2016, though the rate of decrease has slowed down. Poland is in a similar position, but its backsliding in the democracy ranking has been a more recent phenomenon. Slovakia has followed a similar trend, though on a smaller scale, with worsening of democracy ranking and scores compared to 2012-2016. The fellow Visegrad 4 member – the Czech Republic – has also worsened it performance, but to a lesser scale that its neighbors. In the case of Turkey, the country has not changed its position as it has occupied the last place from 2011 to 2017, but the deterioration in scores has continued.

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Trends in the Governance category from 2011 to 2017 Governance: Change in Ranks and Scores 2011-2017

Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Governance Rank Group Country change vs change change change change vs change vs Change Change Change change change change Score 2017 2017 2016 vs 2015 vs 2014 vs 2013 2012 2011 vs 2016 vs 2015 vs 2014 vs 2013 vs 2012 vs 2011

EU15+2 Austria 68 7 -1 -1 -2 0 -2 -2 -1 -1 -1 -2 -2 -1 EU15+2 Belgium 61 11 0 0 -3 -3 -2 -2 0 0 0 -1 0 0 EU15+2 Cyprus 50 19 -2 -2 -2 -5 -7 -6 -1 -2 0 -2 -5 -3 EU15+2 Denmark 72 3 -1 -1 -1 -4 -5 -5 -1 -1 0 -2 -2 -2 EU15+2 Finland 71 4 -1 -1 -4 -2 -3 -2 -1 -3 -2 -1 -1 -1 EU15+2 France 57 13 -1 -1 -4 -3 -3 -2 -1 -1 -1 -1 -1 0 EU15+2 Germany 69 6 1 1 2 2 2 1 3 2 2 1 1 1 EU15+2 Greece 33 29 -1 -1 -2 -3 -4 -6 -1 -1 -2 -2 -2 -3 EU15+2 Ireland 65 10 -2 -2 0 0 2 0 0 -1 -1 -2 0 -1 EU15+2 Italy 42 25 2 2 0 1 0 0 0 0 0 0 -2 -2 EU15+2 Luxembourg 71 5 -1 -1 1 3 0 0 -1 0 0 1 -1 -1 EU15+2 Malta 54 18 -1 -1 -5 -6 -6 -7 -4 -5 -5 -5 -5 -6 EU15+2 Netherlands 72 2 0 0 0 0 2 1 3 2 2 2 4 3 EU15+2 Portugal 59 12 1 1 5 7 5 3 1 3 2 6 5 3 EU15+2 Spain 55 17 4 4 2 0 2 2 2 2 1 -2 1 1 EU15+2 Sweden 73 1 -1 -1 -3 -2 -2 -2 0 2 0 1 1 1 EU15+2 UK 66 9 -1 -1 1 2 1 2 -1 1 1 0 0 1 EU10+1 Bulgaria 35 28 2 2 2 1 0 1 1 1 1 0 0 0 EU10+1 Croatia 41 26 1 1 2 3 3 3 0 0 0 0 0 1 EU10+1 Czech Republic 55 16 1 1 2 0 -1 0 0 0 0 -2 -1 1 EU10+1 Estonia 56 14 1 1 3 4 6 6 1 0 1 5 5 5 EU10+1 Hungary 44 24 1 1 -2 -4 -2 -2 0 0 -2 -2 -2 -2 EU10+1 Latvia 47 23 2 2 3 3 7 7 0 0 1 0 2 2 EU10+1 Lithuania 49 20 0 0 4 7 8 8 0 2 3 4 4 4 EU10+1 Poland 47 22 -2 -2 -4 -4 -2 -1 -1 -2 -2 -2 -2 -2 EU10+1 Romania 36 27 1 1 3 2 2 3 0 0 1 2 2 2 EU10+1 Slovakia 48 21 2 2 0 -2 1 1 1 0 0 0 0 0 EU10+1 Slovenia 56 15 2 2 3 1 0 -2 2 3 2 1 1 -1 CC Albania 23 33 3 3 10 7 3 3 0 1 2 2 0 0 CC Macedonia 24 32 -1 -1 -2 0 -2 -2 0 -1 0 0 -2 0 CC Montenegro 27 31 -2 -2 -2 -2 3 2 0 -1 -1 -1 1 -1 CC Serbia 28 30 -1 -1 6 6 10 10 0 2 3 3 4 4 CC Turkey 16 34 -4 -4 -11 -10 -10 -10 0 -1 -3 -3 -3 -3 PCC BiH 13 35 -1 -1 -6 -6 -4 -4 0 0 -1 -1 0 0 PCC Iceland 68 8 -1 -1 0 6 2 2 -1 -1 -1 3 0 0

Among the older EU member states there are Germany, the Netherlands, Portugal, Spain and Sweden among those registering improvement. The group of EU10+1 states also shows increase in Governance scores and ranking in varying degrees. Estonia, Latvia, Lithuania, Romania have improved the most and Bulgaria has made a more modest advance compared to 2014, 2015 and 2016. Among the candidate countries, Albania and Serbia have improved their performance most.

There is a long list of countries with deteriorated performance, but the most serious decrease includes Cyprus, Greece, and Malta among the old member states. Hungary and Poland lose governance points and positions in the ranking among the new member states. In the candidate countries group, Turkey experiences the most substantial regress in the Governance category.

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Putting the Index 2017 on the map: scores, rankings and clusters

The Catch-up Index uses standardized scores from 0 to 100 (lowest to highest) to grade countries and a scale of 1 to 35 (highest to lowest) for ranking them according to their scores as in all four categories – Economy, Quality of Life, Democracy and Governance – as well as an overall score. In addition, the Index uses a cluster analysis of the results, which divides the countries in groups with identical characteristics. The clusters are hierarchical, i.e. cluster number one containing the best performers and the last cluster of the countries with the poorest performance. Some clusters are closer to each other so they can form larger groupings. In general, the cluster analysis results in forming either six or five clusters. The visualization of the clusters on the map of Europe identifies several patterns in the catching-up process. In this case, the results are based on the overall scores, which are the average of the Economy, Quality of Life, Democracy and Governance scores.

About the cluster analysis The cluster analysis divides countries in the Catch-Up Index into groups based on shared characteristics. In addition, it also shows the proximity of the clusters to one another, i.e. some clusters are closer to each other and more distant from the rest. The clusters are also hierarchical, with better performing countries in clusters of higher order.

The findings of the cluster analysis reveal divisions in Europe along the lines of shared characteristics as identified by the indicators of the Catch-Up Index. This “Europe” is different from the one that is usually perceived to be divided along political lines and by legal arrangements.

The findings of the cluster analysis provide an alternative narrative about the divergence and convergence processes in Europe. It can be argued that countries within one cluster or those clusters in closer proximity are more likely to forge common approaches or policies even if they have disagreements in the short term. Thus the cluster analysis shows a more “organic Europe” - a snapshot of similarity and dissimilarity, based on characteristics of countries, not political agreements or legally bindings. This allows to better track the processes convergence and divergence on the continent.

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The Index 2017 results and clusters by Overall Score Overall Score: Ranking and Clusters 2017 In the 2017 Catch-Up Index, the Overall Overall Rank Northwestern countries have the Group Country Cluster Score 2017 2017 highest overall scores. These include all EU15+2 Denmark 71 1 the Scandinavian countries included in EU15+2 Sweden 71 2 the Index, as well as the Netherlands EU15+2 Luxembourg 70 3 and Luxemburg. The top performers EU15+2 Netherlands 70 4 Denmark and Sweden have 71 points EU15+2 Finland 69 5 1 on a scale from 0 to 100 (lowest to PCC Iceland 66 6 highest). The Southeast European EU15+2 Germany 66 7 countries are at the other end of the EU15+2 Ireland 66 8 ranking with the lowest scoring country EU15+2 Austria 64 9 of BiH with 19 points and the last 35th EU15+2 UK 63 10 place. EU15+2 Belgium 61 11 EU15+2 France 58 12 2 The best performing countries in the EU10+1 Estonia 56 13 first cluster of overall performance are EU10+1 Czech Republic 55 14 mainly in Northwestern Europe and EU10+1 Slovenia 55 15 Austria in Central Europe. There are no EU15+2 Malta 54 16 new EU member states in this cluster. EU15+2 Spain 53 17 However, the second cluster of very EU15+2 Portugal 53 18 good performers already includes one 3 EU10+1 Lithuania 50 19 new member - Estonia – following EU15+2 Cyprus 49 20 France and Belgium in the ranking. The EU10+1 Poland 48 21 third cluster of good to decently EU10+1 Slovakia 48 22 performing countries includes mostly a EU10+1 Latvia 48 23 mix of South, Central European EU15+2 Italy 47 24 countries as well as the two Baltic EU10+1 Hungary 42 25 states of Latvia and Lithuania. This is EU10+1 Croatia 41 26 the group with most new member EU10+1 Romania 37 27 4 state(EU10+1). EU15+2 Greece 37 28 EU10+1 Bulgaria 35 29 CC Montenegro 30 30 5 CC Serbia 29 31 CC Albania 25 32 CC Macedonia 24 33 6 CC Turkey 22 34

PCC BiH 19 35

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The next clusters include Hungary, Croatia, Bulgaria, Romania and the old member Greece in the fourth, transitional cluster. Serbia and Montenegro form the fifth cluster and Macedonia, Albania, Bosnia and Herzegovina and Turkey form the last, sixth cluster.

The map shows that the main division in Europe is between the Balkans and the rest. In contrast, previous editions of the Index showed how the old East-West divisions were giving way to a North-South gap. But already with the 2016 Index edition, there was a visible trend of a lagging Southeastern Europe separated from the rest. The Balkans, in this case includes also Hungary, which is part of Central Europe neighboring SEE and Greece – an old member state. It should be noted that in 2016 both Hungary and Croatia were in the transitional, fourth cluster but in 2017, they missed a chance to progress and joined the lower ranking group.

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The Index 2017 results and clusters by Economy score

Economy Scores: Ranking and Clusters 2017 The Economy clusters in Europe revolve Score Group Country Rank 2017 Cluster 2017 around a circle of the best performing EU15+2 Luxembourg 74 1 Northwestern countries - Luxemburg, EU15+2 Denmark 70 2 Denmark, Sweden, Germany and EU15+2 Sweden 69 3 Ireland. They are followed immediately 1 EU15+2 Ireland 68 4 by the second cluster, which includes EU15+2 Netherlands 68 5 the EU15+2 countries of UK, France, EU15+2 Germany 66 6 Belgium, Austria and Malta and three th PCC Iceland 62 7 EU10+1 states – Estonia (ranked 11 ), th EU15+2 Austria 61 8 the Czech Republic (14 ) and Lithuania th EU15+2 UK 61 9 (16 ). EU15+2 Finland 61 10 The third cluster is composed of a mix of EU10+1 Estonia 57 11 2 old and new member states in Southern EU15+2 France 56 12 EU15+2 Belgium 55 13 and CEE Europe, which includes also EU10+1 Czech Republic 54 14 Romania. The fourth and fifth clusters EU15+2 Malta 54 15 include countries from Southeastern EU10+1 Lithuania 52 16 Europe and Portugal, which are at the EU10+1 Latvia 51 17 end of the ranking. EU10+1 Slovenia 49 18

EU10+1 Slovakia 48 19 EU15+2 Spain 48 20 EU10+1 Poland 46 21 3 EU10+1 Hungary 44 22 EU15+2 Cyprus 43 23

EU15+2 Italy 43 24 EU10+1 Romania 42 25 EU15+2 Portugal 41 26 EU10+1 Bulgaria 40 27 EU10+1 Croatia 39 28 4 CC Turkey 39 29 CC Macedonia 36 30

CC Montenegro 32 31 EU15+2 Greece 31 32 CC Serbia 30 33 5 CC Albania 29 34 PCC BiH 24 35

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The map of clusters in the Economy category shows the division of Southeastern Europe and the rest of the continent.

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The Index 2017 results and clusters by Quality of Life score

Quality of Life Scores: Ranking and Clusters 2017 Most of the European countries have very high or decent quality of Group Country Score 2017 Rank 2017 Cluster life as 27 out of 35 are part of the EU15+2 Luxembourg 70 1 first three clusters. The EU15+2 Finland 70 2 Scandinavian countries, the big EU15+2 Netherlands 70 3 three of Germany, France and the PCC Iceland 69 4 UK and close neighbors of the EU15+2 Germany 68 5 Netherlands, Belgium, Ireland and EU15+2 Denmark 68 6 1 Austria are in the first cluster. The EU15+2 Sweden 67 7 second cluster consists of EU15+2 Belgium 66 8 Southern and CEE countries such EU15+2 Austria 66 9 as Slovenia, the Czech Republic, EU15+2 UK 65 10 Estonia and Poland. The third EU15+2 France 65 11 cluster also consists of several new EU15+2 Ireland 65 12 member states – Slovakia, EU10+1 Slovenia 60 13 Hungary, Croatia, Latvia, Lithuania EU10+1 Czech Republic 55 14 and the old member state of EU15+2 Italy 55 15 Greece. EU15+2 Spain 53 16 EU15+2 Cyprus 53 17 2 In the fourth and fifth clusters and EU10+1 Estonia 53 18 at the bottom of the ranking are EU15+2 Malta 51 19 the countries of Southeastern EU15+2 Portugal 50 20 Europe, with Romania, Bulgaria EU10+1 Poland 50 21 and Montenegro in the fourth EU15+2 Greece 46 22 cluster and the rest are in the last EU10+1 Slovakia 46 23 cluster. EU10+1 Lithuania 46 24 3 EU10+1 Hungary 44 25 EU10+1 Croatia 44 26 EU10+1 Latvia 42 27 CC Montenegro 33 28 EU10+1 Romania 29 29 4 EU10+1 Bulgaria 28 30

CC Serbia 26 31 CC Turkey 25 32 CC Albania 22 33 5 CC Macedonia 19 34 PCC BiH 18 35

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The Index 2017 results and clusters by Democracy score

The ranking in Democracy category in Democracy Scores: Ranking and Clusters 2017 Index 2017 shows that the North and Democracy Group Country Rank 2017 Cluster Score 2017 Northwestern countries are the top performers in the first and second EU15+2 Denmark 75 1 EU15+2 Sweden 74 2 cluster. The second cluster includes th EU15+2 Finland 74 3 Estonia – 13 position – as the best EU15+2 Netherlands 71 4 1 performing in the group of EU10+1. PCC Iceland 67 5 The rest of the other EU new member EU15+2 Luxembourg 67 6 states are in third and fourth cluster. EU15+2 Ireland 66 7

EU15+2 Germany 63 8 EU15+2 Austria 62 9 EU15+2 Belgium 62 10 EU15+2 UK 61 11 EU15+2 Portugal 60 12

EU10+1 Estonia 60 13 2 EU15+2 Malta 56 14 EU15+2 Spain 56 15 EU10+1 Czech Republic 56 16 EU10+1 Slovenia 54 17 EU10+1 Lithuania 52 18 EU15+2 3 France 52 19 EU10+1 Latvia 51 20 EU15+2 Italy 50 21 EU15+2 Cyprus 49 22 EU10+1 Poland 48 23 EU10+1 Slovakia 48 24

EU10+1 Croatia 41 25 EU10+1 Romania 40 26 EU15+2 Greece 37 27 4 EU10+1 Hungary 36 28 EU10+1 Bulgaria 35 29

CC Serbia 32 30 CC Montenegro 27 31 . CC Albania 26 32 5 PCC BiH 20 33 CC Macedonia 19 34

CC Turkey 9 35 6

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The map of the Democracy clusters shows a clear division between the Balkans (with Hungary included) and the rest of Europe. Turkey is the big outlier as it is alone the last sixth cluster. The close neighbors of BiH, Albania and Macedonia are in the second to last cluster. They are surrounded by the rest of the Southeast European countries – a mix of old, new and candidate member states including Greece, Bulgaria, Romania, Croatia and Serbia. The laggards in democracy are joined by Hungary too.

In contrast, the best performing countries are on the other side of the map. The Northwestern European countries Denmark, Sweden, Finland and the Netherlands are in the first cluster. They are immediately followed by the second cluster of well-functioning democracies including Germany, UK, Belgium as well as the new member state Estonia. The third cluster is the most numerous and is composed of states from Southern and CEE Europe

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The Index 2017 results and clusters by Governance score

Governance Scores: Ranking and Clusters 2017 The countries with the highest Governance governance scores are in the Group Country Rank 2016 Cluster Score 2016 Western part of the continent with EU15+2 Sweden 73 1 Scandinavian countries at the EU15+2 Netherlands 72 2 helm, followed by the EU15+2 Denmark 72 3 Netherlands, Germany, UK, Ireland EU15+2 Finland 71 4 and Austria. France, Spain, EU15+2 Luxembourg 71 5 1 Belgium, Portugal are in the EU15+2 Germany 69 6 second cluster of good governance EU15+2 Austria 68 7 and are joined by three new PCC Iceland 68 8 member states – Estonia, the EU15+2 UK 66 9 Czech Republic and Slovenia. EU15+2 Ireland 65 10 EU15+2 Belgium 61 11 EU15+2 Portugal 59 12 EU15+2 France 57 13 EU10+1 Estonia 56 14 2 EU10+1 Slovenia 56 15 EU10+1 Czech Republic 55 16 EU15+2 Spain 55 17 EU15+2 Malta 54 18 EU15+2 Cyprus 50 19

EU10+1 Lithuania 49 20 EU10+1 Slovakia 48 21 EU10+1 Poland 47 22 3 EU10+1 Latvia 47 23 EU10+1 Hungary 44 24 EU15+2 Italy 42 25 EU10+1 Croatia 41 26

EU10+1 Romania 36 27 EU10+1 Bulgaria 35 28 4 EU15+2 Greece 33 29 CC Serbia 28 30 CC Montenegro 27 31 5 CC Macedonia 24 32 CC Albania 23 33 CC Turkey 16 34 6 PCC BiH 13 35

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The third cluster runs from Latvia in the north, through Lithuania, Poland, Slovakia and Hungary in the center and Croatia and Italy to the south.

The last three clusters include the Balkan countries with Croatia the exception as it narrowly escapes to the third cluster. The three member states of Greece, Romania and Bulgaria are the relatively better performing fourth, transitional cluster. The close neighbors of Serbia, Montenegro, Macedonia and Albania are in the fifth cluster and Albania and Turkey are in the last, sixth cluster.

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The Economy category explained: methodology notes

The Economy category measures the economic performance and potential of the countries in the Index. Each of the four categories in the Catch Up Index is ascribed equal importance in terms of calculating a country’s overall score.

The Economy category is measured through a set of nine indicators, each of which captures a different aspect of economic performance. Some indicators gauge more than one aspect of economic performance. The metrics of the indicators are based on 14 sub-indicators, of varying weightings. The specific indicators and the weightings assigned to the sub-indicators reflect the unique model of the Catch Up Index.

The raw data used for the indicators (e.g. GDP per capita or other composite indicator scores or coefficients) are converted into a Catch-Up Index score on a scale of 0 to 100 (lowest to highest) to allow for a standardized score that can be compared across countries or categories and indicators. Each of the indicators has different weight assigned to it, according to its importance in the Catch Up Index model.

Economy Indicators Sub-indicators Weight

GDP per capita GDP per capita in PPS, EU28=100 25% (0,25)

Government debt General government debt (% of GDP) 13% (0,125)

Credit ratings Sovereign credit ratings 13% (0,125)

Employment Employment rate % 8% (0,083)

Energy Intensity Energy intensity of the economy 8% (0,083)

Information Society Information and Communication Technology 8% (0,083)

Patents granted by USPTO per capita 4% (0,042) Research and Development High-tech exports as % of manufactured exports 4% (0,042)

Doing Business rank 4% (0,042) Market development Economic Freedom score 4% (0,042)

Motorways per area 1000 km2 2% (0,021)

Motorways per 100,000 inhabitants 2% (0,021) Transport infrastructure Other roads per 1000 km2 2% (0,021)

Other roads per 100,000 inhabitants 2% (0,021)

GDP per Capita (PPS with EU28=100 basis, Eurostat) remains the most important indicator of economic activity and is assigned 25% weight in the total Economy category.

Government Debt, measured as a % of GDP, is second in importance with 12.5%. The global economic calamities of recent years, and especially the ongoing debt crisis in Europe, have clearly demonstrated the critical importance of government debt as a factor for the economic vitality of a country.

The Sovereign Credit Ratings – or creditworthiness and level of investment risk - of a country are also attributed high importance in the Index, with a 12.5% weight. The Index uses a composite, rescaled score of

34 www.TheCatchUpIndex.eu The Catch-Up Index 2017 the ratings of the three major agencies (Fitch, Moody’s and Standard & Poor’s).

Employment, with a weight of 8%, is a measure of an economy’s potential to generate jobs and integrate as much as possible of the labor force in the labor market; this is measured through the share of working-age people in employment.

Energy Intensity, also ascribed an 8% weighting, is a measure of an economy’s energy efficiency, calculating energy consumption divided by GDP as kilogram of oil equivalent per €1000. Energy intensity is also an important measure of an economy’s competitiveness, because high energy inefficiency incurs more costs in production and services.

Research and Development, again with a weight of 8%, is a measure of the level of development and the “quality” of contemporary economies, including their competiveness. The Index uses two sub-indicators. The first is the number of patents registered from a country with the United States Patent and Trademark Office (USPTO) annually on a per capita basis. The second indicator is the share of high-tech exports in a country’s manufactured exports.

The Market Development indicator (also 8%) is the composite score of two sub-indicators – the World Bank’s Ease of Doing Business ranking and the Heritage Foundation/Wall Street Journal Index of Economic Freedom. The latter defines the highest form of economic freedom as “an absolute right of property ownership, fully realized freedoms of movement for labor, capital, and goods, and an absolute absence of coercion or constraint of economic liberty beyond the extent necessary for citizens to protect and maintain liberty itself.”

The Transport Infrastructure Indicator (8%) is a measure of a country’s economic development and its potential for economic activity. The Index uses four sub-indicators, based on calculating coefficients of motorways and other roads on a per capita and country area basis.

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The ingredients of democracy: Methodology notes

Catching up in Democracy is essential for the post-communist member states of the EU, particularly given that the Copenhagen accession criteria for EU membership primarily focused on democracy. But although EU membership has often been perceived as a watershed in the political transition of the EU10 group, or even the end of that transition, it now appears that the newer members may not have achieved parity with more developed European nations in their progress in building democratic institutions and societies.

The Catch-Up Index was designed to analyse several aspects of democracy that are of particular significance for the newer member states, and those that are aspiring to be.

The Democracy category has equal weighting with the other three categories in the Catch-Up Index (Economy, Quality of Life and Governance). This category is measured through a set of seven indicators, which use nine sub-indicators. The raw data drawn from opinion polls and other composite indicator scores are converted into the Catch-Up Index score on a scale of 0 to 100 (lowest to highest) to give a standardized score that allows for comparison across countries, categories and indicators. Each of the indicators has a different weight assigned to it according to its importance in the Index model.

Democracy Indicators Sub-indicators Weight

Freedom House score Freedom in the World 20% (0,195) Democracy Indices Economist Intelligence Unit Democracy Index 20% (0,195)

Freedom House Freedom of the Press score 10% (0,98) Media Freedom Reporters without Borders Press Freedom Index 10% (0,98)

Satisfaction with democracy Satisfaction with democracy % 10% (0,98)

Trust in People Trust in people 10% (0,98)

Voice and Accountability Voice and Accountability - WGI 10% (0,98)

Human Rights Political terror indicator by Global Peace Index 10% (0,98)

E-participation E-participation index 2% (0,024)

36 www.TheCatchUpIndex.eu The Catch-Up Index 2017 without Borders. Each is assigned 10% weight, giving the Media Freedom indicator a 20% overall weight.

Satisfaction with Democracy measures the attitude of citizens towards the democratic systems of governance in their countries. This is one of the only two indicators (along with Trust in People) that relies on public opinion surveys (in this case the main source is Eurobarometer), and the scores are based on the proportion of citizens who approve their countries’ democratic systems.

Trust in People measures the level of people’s trust of those who are outside of their immediate family or close friends. Literature abounds on the importance of trust for democracy - above all Francis Fukuyama’s “Trust”, – or economy and the successful organization of society. In this case, the Catch-Up Index employs the measure of Trust in People as a proxy for civil society development, given the limitations of available data on similar indicators for all the countries in the Index.

Voice and Accountability, with a weight of 10%, is a composite indicator of the World Bank’s World Governance Indicators (WGI). This includes perceptions of the extent to which a country's citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and a free media. The WGI scores also use World Bank assessments and reports that are not publicly available.

Absence of Political terror is also deemed essential for a functioning democracy and carries a weight of 10%. The scores are based on Global Peace Index “Political terror” indicator, e.g. identifying state terror, or violations of physical and personal integrity rights carried out by the state.

E-participation (2%) measures the level of participation in decision-making, governance or similar activities that is enabled by Information and Communication Technologies. For example, the facilitation of citizens’ political participation through internet or cellular technologies within the broader “e-democracy” concept. Facebook advocacy or the “twitter revolutions” offer specific examples of similar phenomena.

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Quality of Life: Methodology notes

Quality of Life is the category most influenced by the “bottom-up” approach in constructing the index. The metrics of the category have been designed to establish how wealthy people are and to what degree social issues affect them, such as income inequality, risk of poverty and long-term unemployment. The indicators also aim to assess levels of access to higher education and the quality of education available, as well as whether people are living longer, healthier lives with access to good quality healthcare services.

These criteria are prerequisites for individuals to have good quality of life and for the “health” and successful development of society at large. It does not come as a surprise that the majority of the citizens of the newer member states (and the candidates) associate EU membership above all with improved quality of life, at least closer to that of their more established EU counterparts.

The raw data used for the indicators (e.g. life expectancy in years, and other composite indicator scores or coefficients) are converted into the standardized Catch-Up Index score, on a scale from 0 to 100 (lowest to highest), to allow for comparison across countries, categories and indicators. As was the case in the other categories, each of the indicators has a different weight assigned to it, reflecting its importance in the Catch-Up Index model.

Quality of Life Indicators Sub-indicators Weight

Welfare of consumers Actual individual consumption with EU28=100 20% (0,2)

Inequality - Gini coefficient 7% (0,067)

Social issues Relative median at-risk-of-poverty gap (%) 7% (0,067)

Long-term unemployment rate (%) 7% (0,067)

Share (%) of early school leavers 5% (0,05)

Share of population (%) with university degree 5%(0,05)

Education PISA* score in reading literacy 3% (0,033)

PISA score mathematical literacy 3% (0,033)

PISA score in scientific literacy 3% (0,033)

Healthy life expectancy at birth in years 5% (0,05)

Life expectancy in years 5% (0,05) Health Infant mortality by age of 5 5% (0,05)

EuroHealth Consumer Index 5% (0,05)

Human Development Human Development Index (UN) 20% (0,2)

* Programme for International Student Assessment (OECD).

Welfare of Consumers is attributed 20% weight in the category. It is based on data from Eurostat’s Actual Individual Consumption dataset, which is calculated on EU28=100 basis (rescaling each country’s data as a

38 www.TheCatchUpIndex.eu The Catch-Up Index 2017 fraction of the EU mean).

The Social Issues indicator, with a total weight of 21%, comprises three sub-indicators that measure different aspects of social problems in a society. The first assesses social inequality using the Gini coefficient – the greater the inequality, the lower a country’s score in the Index. The second sub-indicator is based on Eurostat’s relative median at-risk-of-poverty gap indicator. The third sub-indicator measures long-term unemployment in society, which signals the existence of more deep-seated social problems that the basic unemployment rate.

The Education indicator has been designed to reflect primarily the quality of education, rather than the quantity, given that the GDP share of education or the number of teachers or students do not always correspond to good outcomes. This is especially valid with regard to the new member states, where often inefficient and unreformed systems produce poor results, notwithstanding the funds or manpower channeled into them.

As is the case with many of the index indicators, their data can also be useful in assessing other aspects of the same category or, in this case, other categories. For example, as well as being a key indicator for Quality of life, education is relevant in assessing economic potential, democracy and good governance. The sub- indicator on early school-leavers assesses the share of young people giving up education and training prematurely; this may also help to gauge broader social problems. The second sub-indicator is the share of the population that hold university degrees. The next three education-related sub-indicators are based on the results of the Organisation for Economic Co-operation and Development’s Programme for International Student Assessment (PISA). The PISA scores go beyond the performance of high-school students and survey the broader state of a country’s education sector, for example qualification levels of teachers and the quality of universities. The Health indicator is likewise designed to focus more on the outcomes than on less indicative criteria such as share of GDP or the number of medical workers. One sub-indicator is life expectancy, measuring how many years a person is expected to live, while another is healthy life expectancy, specifically taking into account life without major illness. The indicator for infant mortality is also indicative of the broader state of health services or social services in a country (or even the state of society more broadly) because it assesses the likelihood of children surviving to the age to 5. The fourth sub-indicator is a composite of the EuroHealth Consumer Index by the Health Consumer Powerhouse, which measures the quality of healthcare systems in a country (including by outcome).

The United Nations’ Human Development Index is a composite index measuring life expectancy, literacy, education and standards of living for countries worldwide. It has similar dimensions to the Catch-Up Index, but includes additional data and methodology, which complements the other indicators but does not overlap with them.

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Governance category explained: methodology notes

The newer and aspiring members typically perceive established EU member states to be well- governed, politically stable, have low levels of corruption, effective governance, a successful rule of law, and an absence of substantial tensions, conflicts and crime. Indeed, from a wider perspective this impression is accurate. The EU is truly an oasis of stable and well-governed states by comparison with some of the more unstable or failing states in other parts of the world. The EU is very much geared toward instilling “good governance” through its common institutions and the acquis communautaire.

But comparisons between EU members and aspiring candidates reveal differences even among relatively homogenous groups. Some of these differences are made strongly apparent, as in the case of the EU’s monitoring of the progress of members Bulgaria and Romania in fighting corruption, organized crime and judicial reform, and the conditionality imposed on candidates.

The Catch-Up Index measures the quality of governance in a country through seven indicators based on ten sub-indicators.

Governance Indicators Sub-indicators Weight

Corruption Perceptions Index - Transparency International 8% (0,08) Corruption Control of Corruption - World Governance Indicators 8% (0,08)

Political instability by Economist Intelligence Unit 8% (0,08) Political stability Political Stability and Absence of Violence - World Governance Indicators 8%(0,08)

Governement effectiveness Governement eEffectiveness - World Governance Indicators 16% (0,16)

Regulatory quality Regulatory quality - World Governance Indicators 16% (0,16)

Rule of law Rule of Law – World Governance Indicators 16% (0,16)

Conflicts and tensions in the country - selected Global Peace Index indicators 8% (0,08) Conflict, tensions and crime Homicide rates per 100,000 population 8% (0,08)

E-government E-government development index 4% (0,04)

The second indicator measures a country’s level of Political stability, as in the threat of government destabilization through social unrest or unconstitutional or violent means through two sub-indicators.

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These are the Economist Intelligence Unit’s Political Instability Index and the Political Stability and Absence of Violence dimension of the World Bank’s World Governance Indicators. The EIU scores “show the level of threat posed to governments by social protest.” The World Bank indicator measures “the perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including domestic violence and terrorism.” The level of political stability indicates any flaws in governance. Although this indicator also relates to democracy – in terms of the channeling of discontent through the process of representation and problem solving – political stability is more of a measure of governance. The indicator‘s weight is 16% divided between the two sub-indicators.

Government effectiveness is an indicator of whether governance is being conducted well; the World Bank states that it “captures perceptions of the quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government's commitment to such policies.” Government effectiveness also has a weighting of 16% in the Governance category.

Regulatory quality is another World Governance Indicators that “captures perceptions of the ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development.” This indicator too has a 16% weighting.

Rule of law is essential for good governance, as the newest EU members and candidates have found out the hard way. The indicator is again based on the World Governance Indicators, which state that it “ captures perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence.”

Conflict, tensions and crime is a composite indicator, based on two sub-indicators relating to a country’s crime levels and conflicts and tensions. The conflicts and tensions sub-indicator is based on selected data from the Global Peace Index (Institute for Economics and Peace/Economist Intelligence Unit). The homicide rate on a per capita basis serves as a proxy for measuring the crime levels in a country, because data pertaining to other reported crimes is less easily comparable (different definitions or practices for registering crimes) or country data is unavailable. The indicator’s weight of 16% is divided between the two sub-indicators.

The E-government indicator is based on the UN’s E-government surveys and scores. It is included in the Index because it is a measure of government efficiency and delivery of services to citizens, and because it facilitates transparency and accountability as the world grows more connected. Moreover, e-government indicates the level of development of contemporary societies. As the UN survey has identified, the scores comprise two basic aspects of e-government, ‘government to citizen’ (G to C) and ‘government to government’ (G to G), with a smaller element of ‘government to business’ interactions. Given that e-government is indicative of many aspects of good governance, but not indispensable, it is ascribed a weight of 4%.

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The catching-up of the EU10+1 countries

EU10+1 catching-up by Overall score

The EU10+2 countries success in catching-up can be assessed by comparing their scores against the background of three benchmarks. These are respectively the maximum score of the EU15+2 group, which corresponds to the best performing country in the group, and often in the index; then the minimum of the EU15+2 group, corresponding to the worst performing country in the group; and finally the “desired European average”, which is the average score of the EU15+2 , the EU older member states.

The Catch-Up Index 2017 results show that no new member state of the EU10+1 group has reached the desired benchmark, which is the average score of the old member-states (EU15+2) and are far from the best performing countries. However, three countries come close to the benchmark as they are catching- up faster than the others. Estonia is 13th in the overall ranking with 56 points followed immediately by the Czech Republic and Slovenia, which are 14th and 15th in the ranking with identical scores of 55 points.

Hungary and Croatia with similar scores of 42 and 41 respectively, and Romania and Bulgaria with 37 and 35 points are at the end of the catching-up process. The rest of the countries occupy the middle ranking positions among the 35 countries included the Index.

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EU10+1 Catching-Up by Overall Score: Change of Scores and Ranks Overall Score Score Score Score Score Score Rank Rank Rank Overall Rank change Rank change Group Country Score change vs change vs change vs change vs change vs change vs change vs change vs change vs Rank 2017 vs 2016 vs 2014 2017 2016 2015 2014 2013 2012 2011 2013 2012 2011

EU15+2 Maximum 71 1 EU15+2 Average 60 EU10+1 Estonia 56 13 0 1 2 3 4 4 0 1 3 5 5 EU10+1 Czech Republic 55 14 0 1 1 0 0 2 1 1 -1 1 3 EU10+1 Slovenia 55 15 1 2 2 0 -1 -1 1 1 -1 -2 -2 EU10+1 Lithuania 50 19 0 1 2 3 6 5 1 3 3 5 5 EU10+1 Poland 48 21 -2 -3 -2 -1 -1 1 -2 -3 -1 -1 1 EU10+1 Slovakia 48 22 -1 0 -1 -1 -1 1 0 -1 -3 -1 -1 EU10+1 Latvia 48 23 1 1 4 5 8 7 1 1 2 4 4 EU10+1 Hungary 42 25 0 0 -1 -2 -3 -4 0 0 -1 -2 -2 EU10+1 Croatia 41 26 0 0 1 0 0 0 0 0 0 0 0 EU10+1 Romania 37 27 1 1 3 3 2 5 1 3 2 1 2 EU15+2 Minimum 37 28 EU10+1 Bulgaria 35 29 1 1 0 0 0 0 0 0 -1 0 -1

When the latest 2017 results are compared to the results of the first edition of the Index in 2011, there are several visible trends. The champions’ trio of best performers Estonia, the Czech Republic and Slovenia has remained in the same formation over the years, but they swapped places. Estonia has earned it first position in the catching-up by being the most dynamic one. It managed to advance 5 positions compared to 2011. The Czech Republic also managed to advance by 3 positions compared to 2011.

Lithuania and Latvia are also among the countries that have been making considerable gains in both the ranking and the scores for several years in a row, i.e. by 5 and 4 positions up from 2011 to 2017. Croatia has been at a standstill since 2011 with Bulgaria in a similar position with small fluctuations in the performance.

Slovenia lost some places in the ranking and points, but managed to stay firmly in the top trio. In contrast, Hungary, Poland and Slovakia have been slipping down the ranking and losing points. In the case of Hungary, it lost 2 positions compared to 2011 and 2012, 1 down compared to 2013, with the respective loss in the scoring – down by 4 points compared to 2011.

Romania is an interesting case of a modest, yet still improvement in the catching-up process. Second to last in the Index, in previous years it has been just swapping places with Bulgaria. In the current Index, it has pulled ahead, advancing by 2 positions and 5 points compared to 2011 and further advancement compared to all next years. It should be seen whether it can continue its winning streak.

There are certain geographic trends to the catching-up process. The Balkan countries are lagging behind and are slow to catch-up, although Romania is trying to break the mold. The Baltics are the most dynamic with Estonia leading in the ranking, but Lithuania and especially Latvia should keep up the speed to converge more successfully. The rest in Central Europe, which includes basically the Visegrad 4 is somewhat of a letdown. Slovakia, Poland and especially Hungary have been backsliding and losing their initially good showing and tempo in the catching-up process.

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There is also another peculiar pattern the timing as most of the changes occur largely until 2014 when the results from 2017 are compared to those in the period 2011-2016. After 2014, there is a slowdown in both progress and regress, with just few exceptions.

Who is who in the catching-up: comparing across the four categories

When the performance of the different EU10+1 countries is compared across the different categories – Economy, Quality of Life, Democracy and Governance – there are several distinct patterns. For example, Estonia, the Czech Republic and Slovenia are the top overall performers among the EU10+1 countries but they don’t perform equally strongly in every category and it is worth delving into the details and compare the countries’ ranking and scores across the board.

Estonia is the top performer in CEE in three out of the four categories – Economy, Democracy and Governance and is first in the overall catching-up ranking. It has a very good showing when compared to all 35 countries in the Index – it is 13th by overall score, 11th in the economy category, 13th in democracy and 14th in governance. However, Estonia backslides to the 3rd spot in Quality of Life among the new member states and is 18th among all 35 countries.

The Czech Republic is second among the EU10+1 countries in the overall ranking as well as in the Economy, Quality of life, Democracy and third in Governance. Slovenia is third by overall score in the catching-up process and it excels in Quality of Life, being first among CEE countries. It is 5th in the EU10+1 Economy ranking (18th among all 35 states in the Index), 3rd in democracy and 2nd in governance.

Bulgaria, Romania and Croatia are mostly at the bottom of the rankings with few exceptions. Latvia joins the laggards’ trio in the Quality of Life and Hungary is second to last in democracy, respectively allowing Croatia to reach higher positions. But Romania shows an upward trend and if it manages to keep up the pace, it might outgrow its surroundings.

Hungary registered the most substantial decline, losing positions compared to 2011, 2012 and 2013 in the overall ranking. It has also regressed in Quality of Life by 3 and 4 positions compared to 2011 and 2012, and in Governance by 2 positions compared to the period 2011-2014. The biggest decline of the country is in Democracy, where it slipped by 6 positions compared to 2011, by 4 places compared to 2012 and 2013, by 3 places compared to 2014, and by 1 spot compared to 2015 and 2016. But it managed to keep up comparatively better economic performance – 8th among the CEE countries (22st among all 35 in the Index 2017) – and advancing by 4 spots compared to 2011 and 2012.

Central European and fellow Visegrad 4 members Poland and Slovakia have a similar trajectory of development to Hungary. Both started in the middle of the rankings in 2011, began to gain speed and improve but then lost momentum and started to regress after 2013-2014. They are currently 5th and 6th respectively in the overall catching-up ranking of the EU10+1 countries, 6th and 7th in economy, 6th and

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7th in Quality of Life, 6th and 7th in Democracy and 5th and 6th in Governance. In the Economy category, Poland managed to improve over its 2011, 2012 and 2013 scores, but then stopped, while Slovakia’s has more gradual, but modest gains. In Quality of Life, both Slovakia and Poland improve over their 2011- 2012 performance, but then lose their advantage.

Lithuania and Latvia has proved to be among the most dynamic in the catching-up, improving their overall scores and rankings, advancing by 5 and 4 positions respectively from 2011 to 2017. They have improved their performance in the Economy, Democracy and Governance categories in varying degrees. But they have been less successful in catching up in Quality of Life with only Lithuania improves moderately – by 2 spots up in the ranking when 2017 and 2011 are considered.

EU10+1 catching-up in the Economy category

The Economy is the Index category where the EU10+1 countries are catching up relatively most successfully. Estonia, the Czech Republic and Lithuania are the best performers. Estonia stands out as it is positioned 11th out of 35 countries and has identical score of 57 points as the desired average benchmark of the EU15+2 group. The majority of countries have made significant gains compared to previous years, jumping by 4, 5 or even 6 notches in the ranking. The exceptions are Slovenia and Croatia, which have went down the ranking by respectively 4 and 3 positions compared to 2011. Slovakia and Bulgaria have modest performance, but there are still catching-up too.

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EU10+1 Catching-Up in Economy: Change of Scores and Ranks Economy Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Rank Group Country Score change vs change vs change vs change vs change vs change vs Change vs Change vs Change vs change vs change vs change vs 2017 2017 2016 2015 2014 2013 2012 2011 2016 2015 2014 2013 2012 2011 EU15+2 Maximum 74 1 EU15+2 Average 57 EU10+1 Estonia 57 11 0 0 1 3 5 5 1 2 2 2 5 5 EU10+1 Czech Republic 54 14 1 2 3 4 4 6 1 3 0 2 4 4 EU10+1 Lithuania 52 16 0 0 2 2 5 6 0 -2 0 -1 3 5 EU10+1 Latvia 51 17 -1 -2 2 4 6 7 0 -1 0 2 5 6 EU10+1 Slovenia 49 18 0 -1 0 -3 -5 -7 1 0 -1 -4 -5 -4 EU10+1 Slovakia 48 19 0 0 1 1 1 2 -1 1 1 1 1 1 EU10+1 Poland 46 21 -1 0 0 1 2 4 0 0 0 1 3 3 EU10+1 Hungary 44 22 0 1 1 1 1 3 0 1 0 2 4 4 EU10+1 Romania 42 25 0 1 3 3 3 5 0 1 2 2 2 4 EU10+1 Bulgaria 40 27 0 1 1 1 1 2 0 1 2 1 1 1 EU10+1 Croatia 39 28 0 -1 0 -4 -4 -3 0 -1 0 -3 -3 -3 EU15+2 Minimum 31 32

But there is a slowdown in the catching-up process, beginning around 2014. Nearly all countries are affected by it, save for some progress by Estonia and the Czech Republic and regress of Lithuania.

The Economy category: catching-up by indicators

The following tables present the ranking and scores of the EU10+1 countries by the basic indicators, which are used to measure the Economy category.

The Czech Republic and Slovenia have the highest GDP per GDP capita among the new member states, but even their scores – Country Score 2017 Rank 2017 Maximum EU15+2 100 1 49 and 47 points respectively – are far from the average score Average EU15+2 61 of 61 points and are nearly half of the best performer among Czech Republic 49 16 the old member states (Luxemburg). Slovenia 47 17 Slovakia 44 20 On the upside, 6 out of 11 new member states have higher GDP Lithuania 43 21 per capita than the minimum of the old members group. Estonia 43 22 Poland 41 23 Minimum EU15+2 40 24 Hungary 40 25 Latvia 39 26 Romania 36 28 Croatia 36 29 Bulgaria 32 30

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Employment Four new member states – Estonia, the Czech Republic, Country Score 2017 Rank 2017 Lithuania and Latvia - have better employment performance Maximum EU15+2 75 2 Estonia 67 7 than the desired average benchmark. Czech Republic 66 8 Lithuania 61 10 Latvia 59 12 Average EU15+2 55 Hungary 55 13 Slovenia 53 15 Slovakia 51 18 Poland 51 21 Bulgaria 48 23 Romania 45 25 Croatia 35 28 Minimum EU15+2 24 31

The research and development indicator uses data of two Research and Development sub-indicators - patents granted by United States Patent and Country Score 2017 Rank 2017 Trademark Office (USPTO) per capita and high-tech exports as Maximum EU15+2 78 1 a percentage of manufactured exports. The Czech Republic, Average EU15+2 60 Czech Republic 48 14 Latvia and Hungary are leading in the group, but still below Latvia 47 15 the desired benchmark. Hungary 47 16 Estonia 45 17 Lithuania 43 18 Slovakia 41 21 Croatia 39 22 Poland 39 23 Slovenia 38 25 Bulgaria 38 26 Romania 38 27 Minimum EU15+2 35 29

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Energy Efficiency Energy efficiency reflects the energy intensity of the Country Score 2017 Rank 2017 economy. This is the worst indicator for the new member Maximum EU15+2 73 1 states as they are below the average and the minimum Average EU15+2 65 score of the old member states. Slovenia and Croatia fare Minimum EU15+2 54 18 relatively better at 18th and 19th positions. Estonia and Slovenia 54 19 st nd Croatia 52 20 Bulgaria are trailing behind with 31 and 32 position out Lithuania 50 21 of 35. Latvia 49 22 Slovakia 48 23 Romania 46 25 Poland 46 26 Hungary 45 27 Czech Republic 43 28 Estonia 25 31 Bulgaria 10 32

The transport infrastructure indicator uses data from four sub- Transport Infrastructure indicators – length of roads and highways both per population Country Score 2017 Rank 2017 and per the country size. Slovenia, Hungary and Estonia fare Maximum EU15+2 72 1 Slovenia 71 2 very well, occupying 2nd, 6th and 7th position out of 35 and are Hungary 59 6 above the average score. Croatia and Lithuania are close to the Estonia 57 7 goal too. Poland, and especially Bulgaria and Romania Average EU15+2 55 underperform. Croatia 54 14 Lithuania 52 15 Czech Republic 45 21 Latvia 45 22 Slovakia 41 26 Minimum EU15+2 41 27 Poland 41 29 Bulgaria 35 32 Romania 34 34

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Most of the new member states excel in their performance as Government Debt st Country Score 2017 Rank 2017 they have very low government debts. Estonia is 1 among 35 th Estonia 83 1 countries, followed by Bulgaria, which is 4 among all Maximum EU15+2 76 2 countries in the Index. All EU10+1 countries are above the Bulgaria 72 4 average benchmark. Czech Republic 67 5 Romania 67 6 Lithuania 66 9 Latvia 65 10 Slovakia 59 13 Poland 58 15 Hungary 46 23 Slovenia 44 25 Croatia 41 26 Average EU15+2 41 Minimum EU15+2 0 35

This indicator consists of two sub-indicators – of Doing Market Development Business and Index of Economic Freedom. Estonia excels in Country Score 2017 Rank 2017 Estonia 78 1 this indicator as it is first among all 35 countries. Latvia and Maximum EU15+2 76 3 th th Lithuania are not that far behind being 6 and 8 . The Czech Lithuania 71 6 Republic and Poland are also above average performers. Latvia 68 8 Hungary, Slovenia and Croatia are last in the group. Czech Republic 60 14 Poland 54 15 Average EU15+2 53 Romania 48 17 Bulgaria 46 19 Slovakia 44 20 Hungary 40 25 Slovenia 35 28 Croatia 29 32 Minimum EU15+2 14 34

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Information&Communication Technology The Information and Communication Technology index of Country Score 2017 Rank 2017 the United Nations measures the level of development of Maximum EU15+2 80 2 the information society in a country. Estonia is first among Estonia 67 10 its peers of the EU10+1 group and 10th in the overall Average EU15+2 62 Czech Republic 50 16 ranking and scores above the average benchmark. In the Slovenia 50 17 Index 2017, Iceland ranks first and Denmark is second (first Lithuania 47 20 in the EU) with 80 points. Latvia 47 21 Croatia 46 22 Slovakia 44 23 Hungary 39 25 Bulgaria 39 26 Poland 38 27 Minimum EU15+2 35 29 Romania 30 30

The Credit Indices is the average score of the sovereign Credit Rating rating risks of the three big credit agencies - Moody’s, S&P Country Score 2017 Rank 2017 and Fitch. The Czech Republic and Estonia both perform Maximum EU15+2 79 2 just above average with identical score of 60 points, but Czech Republic 60 11 bellow the best performing country with score of 79 points. Estonia 60 12 Average EU15+2 60 Slovakia 57 13 Slovenia 52 17 Latvia 51 18 Lithuania 51 19 Poland 51 20 Bulgaria 42 23 Hungary 39 24 Romania 39 25 Croatia 31 29 Minimum EU15+2 10 35

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The EU10+1 catching-up in the Quality of Life category

Slovenia is the closet EU10+1 country to the desired quality of life benchmark with 60 points and 13th position in the ranking of 35 countries. The Czech Republic and Estonia are second and third among the CEE countries. However, Estonia is a distant 18th among all countries in the Index. Latvia, Romania and Bulgaria are the last in quality of life catching-up of CEE countries.

EU10+1 Catching-Up in Quality of Life: Change of Scores and Ranks Score Score Score Score Score Score Rank Rank Rank Rank Change Rank Change Rank Change Group Country Score 2017 Rank 2017 change vs change vs change vs change vs change vs change vs change vs change vs change vs vs 2016 vs 2015 vs 2014 2016 2015 2014 2013 2012 2011 2013 2012 2011 EU15+2 Maximum 70 1 EU15+2 Average 62 EU10+1 Slovenia 60 13 0 4 1 3 2 2 0 1 0 1 1 2 EU10+1 Czech Republic 55 14 -1 -1 -1 -3 0 2 0 -1 0 -1 2 4 EU10+1 Estonia 53 18 -1 1 2 5 4 4 -1 0 1 3 2 2 EU10+1 Poland 50 21 0 1 0 2 2 4 0 -1 -1 1 3 2 EU15+2 Minimum 46 22 EU10+1 Slovakia 46 23 0 2 0 -3 -1 1 0 1 0 -4 -1 1 EU10+1 Lithuania 46 24 0 0 0 1 7 5 0 -1 0 0 2 2 EU10+1 Hungary 44 25 0 0 0 0 -4 -4 0 0 0 0 -4 -3 EU10+1 Croatia 44 26 1 0 1 2 3 0 0 0 0 0 -1 -1 EU10+1 Latvia 42 27 1 0 3 5 7 6 0 0 0 0 0 0 EU10+1 Romania 29 29 1 -1 0 1 -3 2 1 0 0 2 1 2 EU10+1 Bulgaria 28 30 -1 -1 -1 0 -2 -2 -1 0 0 0 1 0

The catching-up in the quality of life is the slowest compared to the other categories. With the exception of Slovenia and the Czech Republic, the rest of the countries do not have particularly good performance, starting from 18th position (Estonia) to 30th (Bulgaria) on a scale from 1 to 35. The old EU member states maintain higher quality of life with even the lowest ranking EU15+2 country is not lagging so far behind, as for example in economy ranking.

Hungary is the country, which suffered the biggest regress, dropping by 3 and 4 positions compared to 2011 and 2012 respectively.

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In terms of longer-term trends, most of the countries have improved their performance in comparison to 2011. The Czech Republic advanced significantly by 4 positions compared to 2011, but then began to slowdown in 2013. Estonia and Romania have sustained progress over three years, e.g. when the 2017 results are compared to those in 2011, 2012 and 2013.

The data shows also there are not many changes after 2013, e.g. the catching-up have stalled and the countries rather retain their results.

The Quality of Life category: catching-up by indicators

The consumption indicator is used for comparing the relative Consumption per capita welfare of consumers between countries. The Index 2017 Country Score 2017 Rank 2017 results show that the new EU member states are still far from Maximum EU15+2 86 1 Average EU15+2 65 reaching the older member states in this indicator – with Lithuania 52 16 nearly 34 points below the best performer and below the Czech Republic 46 19 average benchmark. Only Lithuania, the Czech Republic and Minimum EU15+2 45 20 several other countries have relatively better results. Unlike Slovakia 45 21 many other indicators, the worst performing old member Poland 43 22 Slovenia 43 23 state is still better off than the majority of new member Estonia 40 24 states. Latvia 37 25 Hungary 34 26 Romania 34 27 Croatia 31 29 Bulgaria 27 31

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Social Issues is a composite indicator that includes three sub- Social Issues indicators on inequality, risk of poverty and long-term Country Score 2017 Rank 2017 unemployment. Slovenia, the Czech Republic and Hungary Maximum EU15+2 72 2 perform above the desired average benchmark – i.e. the Slovenia 66 4 average score of the old member states. Slovakia and Poland Hungary 64 8 also come very close to the goal. Czech Republic 63 11 Average EU15+2 57 Slovakia 56 17 Poland 55 18 Croatia 50 20 Estonia 50 21 Latvia 46 22 Lithuania 42 25 Romania 33 29 Bulgaria 29 31 Minimum EU15+2 28 32

Education The Education indicator is a composite of several sub- indicators – share of people with university education, share Country Score 2017 Rank 2017 Maximum EU15+2 72 1 of early school leavers and the PISA results. Estonia is just 1 Estonia 71 2 point short of being first in the overall ranking and along with Slovenia 65 4 Slovenia and Poland it performs above the average. Lithuania Poland 62 10 and Latvia also perform strongly and are close to the average Average EU15+2 59 score. Lithuania 58 15 Latvia 57 16

Czech Republic 55 18 Croatia 52 21 Hungary 47 24 Slovakia 45 26 Minimum EU15+2 39 27 Bulgaria 37 28 Romania 29 31

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The Health indicator uses several sub-indicators: life Health expectancy, healthy life expectancy, quality of the healthcare Country Score 2017 Rank system and the infant mortality. Only Slovenia is close to the Maximum EU15+2 71 2 average benchmark. And unlike the majority of cases, the old Average EU15+2 64 Slovenia 62 13 member states worst performer with the minimum score is Czech Republic 54 19 still in much better shape than the others in the group. Minimum EU15+2 54 20 Estonia 50 21 Croatia 46 22 Poland 39 23 Slovakia 39 24 Hungary 32 28 Latvia 32 29 Lithuania 29 30 Bulgaria 22 33 Romania 20 34

The Human Development Index of the United Nations is a Human Development Index summary measure of average achievement in key dimensions of human development: a long and healthy life, being Country Score 2017 Rank Maximum EU15+2 76 1 knowledgeable and have a decent standard of living. Slovenia Average EU15+2 64 is closest to the average score of the old member states, Slovenia 62 13 followed by the Czech Republic. Bulgaria and Romania Czech Republic 58 16 underperform. Estonia 53 18 Poland 49 21 Lithuania 47 22 Slovakia 46 23 Minimum EU15+2 45 24 Hungary 42 25 Latvia 40 26 Croatia 39 27 Romania 29 29 Bulgaria 27 30

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EU10+1 catching-up in the Democracy category

Estonia, the Czech Republic and Slovenia are the countries closest to the desired goal of catching-up in the democracy category. Moreover, Estonia occupies 13th position out of 35, surpassing many other member states and is just one point below the old-member average score.

Bulgaria (29th) and Hungary (29th) are at the bottom of the ranking with negligible difference in the scores.

In terms of longer term development, Hungary has regressed significantly by losing 6 positions in the ranking in comparison to 2011 and has minus 15 points in the score, respectively. Similarly, Poland and Slovakia have been backsliding too, going down the ranking and losing score points, especially in comparison to 2012. Poland has slipped 5 positions down the ranking.

Latvia and Romania have climbed up in the ranking, making considerable gains with respectively 5 and 3 positions up compared to 2011. In general, the Baltic countries have stayed on course to democracy gains, all Central European countries of the V4 have regressed compared to their initial strong showing, the Balkan countries have stagnated with Romania as the exception from these geographic patterns.

EU10+1 Catching-Up in Democracy: Change of Scores and Ranks Score Score Score Score Score Score Rank Rank Rank Democracy Rank Change Rank Change Rank Change Group Country Rank 2017 change vs change vs change vs change vs change vs change vs change vs change vs change vs Score 2017 vs 2016 vs 2015 vs 2014 2016 2015 2014 2013 2012 2011 2013 2012 2011 EU15+2 Maximum 75 1 EU15+2 Average 61 EU10+1 Estonia 60 13 1 1 0 1 1 2 0 0 -1 -1 -2 -1 EU10+1 Czech Republic 56 16 -1 0 0 -1 -1 -1 -2 -1 -1 -2 -3 -2 EU10+1 Slovenia 54 17 1 3 1 0 0 0 2 3 -1 0 -1 0 EU10+1 Lithuania 52 18 0 0 1 3 2 1 3 0 3 3 3 2 EU10+1 Latvia 51 20 2 4 8 11 10 7 3 3 4 6 6 5 EU10+1 Poland 48 23 -6 -7 -4 -4 -5 -3 -8 -7 -5 -5 -5 -2 EU10+1 Slovakia 48 24 -6 -4 -4 -3 -4 -1 -6 -5 -5 -4 -5 -1 EU10+1 Croatia 41 25 -1 -1 0 -1 -2 0 0 0 1 0 0 2 EU10+1 Romania 40 26 2 4 6 7 5 9 0 2 3 3 2 3 EU15+2 Minimum 37 27 EU10+1 Hungary 36 28 -2 -1 -5 -6 -9 -15 -1 -1 -3 -4 -4 -6 EU10+1 Bulgaria 35 29 3 1 -1 1 -1 1 1 0 -1 -1 0 -1

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The Democracy category: catching-up by indicators

Satisfaction with Democracy The Satisfaction with Democracy indicator is based on results Country Score 2017 Rank 2017 of public opinion surveys (Eurobarometer). In general, the Maximum EU15+2 89 1 new member states are far from the best performing old Average EU15+2 60 member state with over 30 points difference, but the Czech Czech Republic 58 12 Republic, Poland and Estonia are closest to the average Poland 56 13 benchmark. Romania, Lithuania and Croatia are most Estonia 52 16 Latvia 47 19 dissatisfied with the way democracy works in their country. Hungary 45 20 Slovakia 36 24 Slovenia 35 25 Bulgaria 33 28 Romania 27 31 Lithuania 26 32 Croatia 20 34 Minimum EU15+2 16 35

Trust in People is a proxy indicator for civil society Trust in People development. It measures to what extent people trust Country Score 2017 Rank 2017 others that are not their immediate friends and relatives. This is a fundamental measure for a democratic society. In Maximum EU15+2 100 1 general, the new member states have lower trust in others Latvia 66 6 Slovenia 66 7 compared to the best performers in the Index. Latvia, Romania 64 9 Slovenia, Romania and Lithuania are above the average Lithuania 59 13 and Poland is close to it. Bulgaria is the worst performer in Average EU15+2 58 the group. Poland 57 14 Estonia 53 16 Slovakia 53 17 Czech Republic 43 24 Hungary 43 25 Croatia 40 26 Minimum EU15+2 28 28 Bulgaria 23 30

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The Democracy Indices is a composite score of Freedom Democracy Indices House and Economist Intelligence Unit reports. According to Country Score 2017 Rank 2017 these results, all new member states are below the average Maximum EU15+2 74 1 benchmark and far from the best performer among the old Average EU15+2 63 member states. Still, Estonia is 15th among 35 countries and Estonia 57 15 first among its peers, followed by the Czech Republic and Czech Republic 55 18 th Slovenia 54 20 Slovenia. Hungary is the worst performing country – 29 out Lithuania 52 21 of 35 - with Bulgaria and Romania close by. Slovakia 49 22 Latvia 48 23 Minimum EU15+2 47 24 Croatia 43 25 Poland 42 26 Bulgaria 42 27 Romania 40 28 Hungary 33 29

Media Freedom Media freedom is measured through the Freedom House Freedom of the Press score and the Reporters without Country Score 2017 Rank 2017 Borders Press Freedom Index. Estonia has the highest level of Maximum EU15+2 76 1 media freedom among new EU member states. It has a very Estonia 67 8 high score of 67 points, close to the best performer with 76 Average EU15+2 61 th Czech Republic 60 13 points and it is 8 among all 35 countries. The Czech Republic Slovakia 59 14 and Slovakia are just slightly below the average benchmark Lithuania 56 16 (Slovakia’s data precede the tragic death of journalist Jan Latvia 56 17 Kuciak). Bulgaria is the worst performing country on 28th Slovenia 54 19 Poland 42 24 position among 35 countries and is close to the bottom of the th th Romania 42 25 ranking, preceded by Hungary (27 ) and Croatia (28 ). Croatia 35 26 Hungary 33 27 Minimum EU15+2 31 28 Bulgaria 28 32

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Civil and Political Rights This indicator is based on two sub-indicators - Voice and Accountability of the World Bank and the Political Terror Country Score 2017 Rank 2017 indicator of the Global Peace Index. Estonia and the Czech Maximum EU15+2 70 1 Republic are slightly above the average benchmark with Estonia 64 9 Czech Republic 60 11 several other countries close by it. Average EU15+2 60 Slovenia 59 14 Lithuania 58 15 Poland 56 17 Croatia 52 22 Latvia 49 23 Slovakia 42 25 Hungary 40 26 Romania 36 28 Bulgaria 34 29 Minimum EU15+2 31 31

The E-participation indicator measures the "ICT-supported E-participation participation in processes involved in government and Country Score 2017 Rank 2017 governance”, referring to citizen participation in the process. Maximum EU15+2 88 1 According to the UN E-Participation Index used, Poland, Lithuania Poland 71 8 and Estonia perform above the average benchmark. Lithuania 64 9 Estonia 61 13 Average EU15+2 58 Croatia 57 15 Slovenia 49 18 Bulgaria 45 21 Romania 35 26 Czech Republic 26 30 Slovakia 23 31 Latvia 21 32 Minimum EU15+2 21 33 Hungary 16 35

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EU10+1 catching-up in the Governance category

Estonia, Slovenia and the Czech Republic are the best performing countries with identical scores 56, 56 and 55 respectively on a scale from 0 to 100. They are close, but still below the average benchmark with 61 score. The three top performers are 14th, 15th and 16th in the ranking out of 35 countries.

The countries that lag behind the most are Bulgaria (28th) and Romania (27th) with identical scores of 35 and 36 points. The rest of the countries have average performance in the middle of the ranking.

EU10+1 Catching-Up in Governance: Change of Scores and Ranks Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Governance Group Country Rank 2017 change vs change vs change vs change vs change vs change vs Change vs Change vs Change vs change vs change vs change vs Score 2017 2016 2015 2014 2013 2012 2011 2016 2015 2014 2013 2012 2011 EU15+2 Maximum 73 1 EU15+2 Average 61 EU10+1 Estonia 56 14 1 1 3 4 6 6 1 0 1 5 5 5 EU10+1 Slovenia 56 15 2 2 3 1 0 -2 2 3 2 1 1 -1 EU10+1 Czech Republic 55 16 1 1 2 0 -1 0 0 0 0 -2 -1 1 EU10+1 Lithuania 49 20 0 0 4 7 8 8 0 2 3 4 4 4 EU10+1 Slovakia 48 21 2 2 0 -2 1 1 1 0 0 0 0 0 EU10+1 Poland 47 22 -2 -2 -4 -4 -2 -1 -1 -2 -2 -2 -2 -2 EU10+1 Latvia 47 23 2 2 3 3 7 7 0 0 1 0 2 2 EU10+1 Hungary 44 24 1 1 -2 -4 -2 -2 0 0 -2 -2 -2 -2 EU10+1 Croatia 41 26 1 1 2 3 3 3 0 0 0 0 0 1 EU10+1 Romania 36 27 1 1 3 2 2 3 0 0 1 2 2 2 EU10+1 Bulgaria 35 28 2 2 2 1 0 1 1 1 1 0 0 0 EU15+2 Minimum 33 29

In regard to longer-term trends, only Estonia and Lithuania have made the most considerable gains, advancing in comparison to several consecutive years from 2011 to 2017. Their neighbor Latvia has less impressive gains in the ranking, but has comparable gains in scores. Romania, though lower down the ranking, have made gains in both the ranking and the scores.

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Hungary and Poland have regressed the most and for several years in a row, when their 2017 results are compared to those of 2011 and later, right up to 2016 for Poland.

The governance table shows that there are not many changes and, similarly to other categories, there is generally a slowdown of the catching-process after 2014-2015.

The Governance category: catching-up by indicators

The corruption indicator uses the Transparency International Corruption and World Bank indices. It seems that Romania’s anti- Country Score 2017 Rank 2017 corruption policies are yielding results as it occupies 27th Maximum EU15+2 81 1 place (1-35) with a score of 34 (100-0). Estonia is the least Average EU15+2 63 corrupt countries in CEE with a score just below the average Estonia 61 13 benchmark and 13th place out of 35 countries. The rest of the Poland 52 15 Slovenia 52 16 countries have good to decent performance. Bulgaria is by Lithuania 49 18 far the worst performing country among the new EU th Latvia 44 21 member states with 26 points and 30 position out of 35. Czech Republic 43 22

Slovakia 39 23 Croatia 37 24 Hungary 36 25 Romania 34 27 Minimum EU15+2 31 28

Bulgaria 26 30

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The political stability indicator uses two sub-indicators - Political Stability Political instability of the Economist Intelligence Unit and Country Score 2017 Rank 2017 Political Stability and Absence of Violence of the World Maximum EU15+2 77 1 Governance Indicators. Slovenia, the Czech Republic are Slovenia 70 4 more politically stable than the rest of the CEE countries Czech Republic 62 12 and there score is above the average benchmark. Poland is Average EU15+2 58 the least politically stable country in its group. Hungary 58 14 Slovakia 54 17 Lithuania 52 19 Romania 51 20 Estonia 50 21 Croatia 49 22 Latvia 49 23

Bulgaria 39 27 Minimum EU15+2 38 28 Poland 36 30

Slovenia, Estonia and Lithuania have the most effective Government Effectiveness governments in CEE. They are close, yet below to the Country Score 2017 Rank 2017 th average benchmark. Bulgaria – 27 place and Romania – Maximum EU15+2 78 1 34th - have the least effective governments in the group. Average EU15+2 63 Slovenia 58 14 Estonia 57 16 Lithuania 56 17 Czech Republic 53 18 Latvia 52 19 Slovakia 49 22 Poland 46 23 Croatia 41 25

Hungary 40 26 Bulgaria 35 27 Minimum EU15+2 32 28 Romania 14 34

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Estonia has better scores in Regulatory Quality than the Regulatory Quality average of the old member and is on 8th position out of 35. Country Score 2017 Rank 2017 Croatia, the newest new member state has the lowest score Maximum EU15+2 78 1 Estonia 70 8 and position within its group in this indicator. Average EU15+2 62 Lithuania 57 14 Latvia 56 15 Czech Republic 52 19 Poland 50 20 Slovakia 49 21

Bulgaria 41 24 Slovenia 40 25 Hungary 38 26 Romania 37 27 Croatia 30 29

Minimum EU15+2 20 33

In the Rule of Law indicator, the CEE countries perform Rule of Law under the desired average benchmark, but Estonia is Country Score 2017 Rank 2017 closest to the goal with 13th position among 35 countries. Maximum EU15+2 76 1 Croatia, Romania and Bulgaria – 25th, 26th and 29nd in the Average EU15+2 62 ranking – have the lowest scores in the group. Estonia 62 13 Czech Republic 59 15 Slovenia 57 16 Lithuania 56 18

Latvia 55 20 Slovakia 49 22 Poland 48 23 Hungary 44 24 Croatia 39 25

Romania 34 26 Minimum EU15+2 31 28 Bulgaria 26 29

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Internal Conflict and Crime This indicator is composed of two sub-indicators - Conflicts and Country Score 2017 Rank 2017 tensions in the country – by selected Global Peace Index Maximum EU15+2 72 1 indicators and the Homicide rates per 100,000 people. The Czech Republic 67 6 Czech Republic is the only one performing above the average th Average EU15+2 59 benchmark and it has very high 6 position among 35 Slovenia 57 12 countries. Three countries – Estonia, Latvia and Lithuania – Slovakia 56 14 underperform and are under the minimum score of the old Hungary 52 19 member states. Croatia 52 20

Poland 52 21 Romania 51 22 Bulgaria 46 25 Minimum EU15+2 45 27 Estonia 34 30 Latvia 27 33 Lithuania 23 34

The E-government indicator is based on the UN’s E- E-government government surveys and scores. It is included in the Index Country Score 2017 Rank 2017 because it is a measure of government efficiency and delivery Maximum EU15+2 85 1 of services to citizens. Estonia is leader in the CEE group of Estonia 69 7 countries with 69 points and 7th place in the ranking, but it is Average EU15+2 63 far from the best performer among the old member states Slovenia 59 12 with 85 points. Lithuania 58 14 Poland 48 19 Croatia 48 20 Latvia 41 24

Hungary 40 25 Czech Republic 34 27 Bulgaria 33 28 Minimum EU15+2 26 29 Slovakia 24 30 Romania 19 33

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EU10+1 performance by country in the Catch-Up Index 2017

The spider graphs below show how the EU10+1 individual country scores compared to the desired “European average” in the four categories – Economy, Quality of Life, Democracy and Governance. The EU15+2 average is calculated as the average of the scores of the 15 older EU member states and Cyprus and Malta.

In addition to the distance to the desired average goal, the graphs shows to what extent the catching-up is an even process, in what areas the convergence is more successful and in what it is lagging behind. In the majority of cases, the scores in the Economy category are closer, meaning the catching-up is more successful. Reversely, the catching-up in the Quality of Life might not be that successful for most of these countries.

The graphs show also that the countries that are in forward ranking positions, i.e. more successful in catching-up in general have similarly equal performance across all four categories. There is probably a simple conclusion that they are no shortcuts and countries cannot skip one area of development – e.g. good governance – at the expense of another.

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We need to talk about the Balkans: how the candidate countries are catching-up

There are often marked differences in the catching-up process between the countries in Europe in the Catch-Up Index, but the Balkans deserves a special mention. Whereas some countries showed stagnation or even regress in one or two of the Index four categories, the Balkans countries show overlap of poor performance and longer-term trends in all four – Economy, Quality of Life, Democracy and Governance.

A closer look shows the state of catching-up of the Balkans – these are the candidate countries of Albania, Macedonia, Montenegro, Serbia and Turkey as well as Bosnia and Herzegovina (BiH) as a potential candidate country. It should be noted again that the Index uses per capita metrics, so the size of a country does not matter and internal regional differences within a country are not accounted for.

The scores of the countries for 2017 are compared and ranked to the average scores of two groups – the older (EU15+2) and the newer (EU10+1) EU member states. The tables also show each country changes over the years – from the first Index edition in 2011 to 2017 (released in 2018) in terms of both scores and ranking positions.

The ranking by Overall Score shows that all these Balkan countries are below the worst performing old and new member states and far from the desired average benchmarks. Montenegro – 30th out of 35 positions with 30 points and Serbia – 31st position with 29 points are the best performers in the group.

The Balkans Catching-Up: Trends by Overall Scores 2011 - 2017 Overall Score Score Score Score Score Score Rank Rank Rank Rank change Rank change Rank change Country Score Overall change vs change vs change vs change vs change vs change vs change vs change vs change vs vs 2016 vs 2015 vs 2014 2017 Rank 2017 2016 2015 2014 2013 2012 2011 2013 2012 2011 EU15+2 Maximum 71 1 EU15+2 Average 60 EU10+1 Maximum 56 13 EU10+1 Average 47 EU15+2 Minimum 37 28 EU10+1 Minimum 35 29 Montenegro 30 30 0 -2 -5 -4 -1 0 0 0 -2 0 0 0 Serbia 29 31 0 2 2 1 1 2 0 0 0 0 0 0 Albania 25 32 2 4 4 2 5 5 1 2 3 2 3 3 Macedonia 24 33 -1 -3 -1 -2 -3 -3 -1 -1 0 -1 -1 -1 Turkey 22 34 -1 -3 -4 -3 -3 -2 0 -1 -2 -1 -1 -1 BiH 19 35 1 -1 -4 -3 -4 -3 0 0 -1 0 -1 -1

In terms of trends, only Albania demonstrates progress, advancing by 3 positions when 2017 and 2011- 2012 are compared, by 2, 3 and 1 position up respectively for each year from 2013 to 2016. Albania makes gains also in terms of scores addition from 5 to 2 points between 2011 and 2016. Serbia and

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Montenegro show mostly stagnation in the ranking, though Serbia has some increase in scores, while Montenegro loses points. Macedonia, Turkey and Albania slowly lose positions in the rankings between 2011 and 2016 – generally 1 position down compared to previous year and they lose points at a faster pace with 3-4 points lost each year.

The Balkans Catching-Up: Trends by Economy Scores 2011 - 2017 Economy Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Rank Country Score change vs change vs change vs change vs change vs change vs Change vs Change vs Change vs change vs change vs change vs 2017 2017 2016 2015 2014 2013 2012 2011 2016 2015 2014 2013 2012 2011 EU15+2 Maximum 74 1 EU15+2 Average 57 EU10+1 Maximum 57 11 EU10+1 Average 48 EU10+1 Minimum 39 28 Turkey 39 29 2 0 1 2 1 3 0 0 1 1 0 1 Macedonia 36 30 0 0 1 1 1 3 0 0 1 1 0 3 Montenegro 32 31 -1 0 -10 -7 -3 -2 0 0 -6 -2 1 1 EU15+2 Minimum 31 32 Serbia 30 33 1 3 -1 -2 -3 -3 1 1 1 -1 0 -2 Albania 29 34 0 0 -2 -3 -1 2 -1 -1 -1 -1 0 1 BiH 24 35 0 -2 -5 -7 -2 -4 0 0 0 0 0 -1

In the Economy category, three countries outperform the lowest scoring old member state, but this bar is set too low. All candidate countries are far from the desired average benchmarks. The best performers in the group are Turkey – 29th position out of 35 with 39 points, Macedonia – 30th place with 36 points and Montenegro – 31st place with 32 points.

In terms of longer term trends, the countries mostly stagnate or have fluctuating development. BiH position has stagnated while losing points, especially compared to 2013-2014. Similarly, Montenegro makes a drop compared to 2013-2014. Macedonia registers increase by 3 positions compared to 2011, by 1 position compared to 2013-2014 with respective gains in scores. Turkey makes modest gains compared to 2011, 2013 and 2014 in positions and a little better in terms of scores.

The Balkans Catching-Up: Trends by Democracy Scores 2011 - 2017 Score Score Score Score Score Score Rank Rank Rank Democracy Rank Change Rank Change Rank Change Country Rank 2017 change vs change vs change vs change vs change vs change vs change vs change vs change vs Score 2017 vs 2016 vs 2015 vs 2014 2016 2015 2014 2013 2012 2011 2013 2012 2011 EU15+2 Maximum 75 1 EU15+2 Average 61 EU10+1 Maximum 60 13 EU10+1 Average 47 EU15+2 Minimum 37 27 EU10+1 Minimum 35 29 Serbia 32 30 -1 -2 3 4 2 6 -1 0 1 1 1 1 Montenegro 27 31 1 -3 -3 -6 -5 -2 0 0 -1 -1 -1 -1 Albania 26 32 4 7 4 7 6 11 0 1 0 2 2 2 BiH 20 33 5 3 0 -1 -2 0 1 1 0 0 0 0 Macedonia 19 34 -1 -1 0 -4 -8 -7 -1 -2 0 -2 -2 -2 Turkey 9 35 -1 -2 -4 -5 -10 -5 0 0 0 0 0 0

In the Democracy category, the best performers in the group are Serbia – 30th place out of 35 with 32 points, Montenegro – 31st place with 27 points and Albania – 32nd place with 26 points. But none of these countries is above the minimum or close to the average Democracy benchmarks of either the

68 www.TheCatchUpIndex.eu The Catch-Up Index 2017 older or newer member states. In terms of trends, only Albania and to lesser extent Serbia make progress - Albania by 2 positions up compared to its 2011-2013 results with significant gains in points – 11 points more compared to 2011 and then by 4 to 7 points in the rest of the period. Serbia progresses by 1 position each year from 2011 to 2014 with 6 points more compared to 2011. Macedonia registers drops from 2011 onwards in both positions and points, but it should be noted that the Index score do not register the latest events in full there. Turkey has basically retained its last position in the Index from 2011 to 2017, but has registered significant decreases in the Democracy scores compared especially to 2012 with 10 points less.

The Balkans Catching-Up: Trends by Quality of Life Scores 2011 - 2017 Score Score Score Score Score Score Rank Rank Rank Rank Change Rank Change Rank Change Country Score 2017 Rank 2017 change vs change vs change vs change vs change vs change vs change vs change vs change vs vs 2016 vs 2015 vs 2014 2016 2015 2014 2013 2012 2011 2013 2012 2011 EU15+2 Maximum 70 1 EU15+2 Average 62 EU10+1 Maximum 60 13 EU15+2 Minimum 46 22 EU10+1 Average 45 Montenegro 33 28 0 -4 -4 0 0 2 0 0 0 0 1 1 EU10+1 Minimum 28 30 Serbia 26 31 -1 3 1 -4 -7 -6 0 1 1 -2 -3 -3 Turkey 25 32 0 -2 -3 1 3 3 0 -1 -1 0 1 2 Albania 22 33 1 4 5 2 1 0 1 2 2 2 1 0 Macedonia 19 34 -3 -4 -4 -4 -5 -6 -1 -1 -1 -1 -2 -2 BiH 18 35 1 -4 -4 -3 -1 0 0 -1 -1 -1 0 0

In Quality of Life, Montenegro manages to outperform in 2017 the worst performing new member states on 28th place and 33 points, but it is not very close to the average benchmarks. Serbia – 31st out of 35 countries and 26 points and Turkey – 32 place with 25 points follow in the ranking. Apart from Montenegro, which registers modest progress compared to 2011 and 2012, Turkey and Albania gain some points and positions, while Serbia’s performance is inconclusive with modest gains compared to 2014 and 2015, but bigger losses compared to the period 2011-2013. Macedonia registers decrease in both positions and especially scores and BiH follows a similar trend.

The Balkans Catching-Up: Trends by Governance Scores 2011 - 2017 Score Score Score Score Score Score Rank Rank Rank Rank Rank Rank Governance Country Rank 2017 change vs change vs change vs change vs change vs change vs Change vs Change vs Change vs change vs change vs change vs Score 2017 2016 2015 2014 2013 2012 2011 2016 2015 2014 2013 2012 2011 EU15+2 Maximum 73 1 EU15+2 Average 61 EU10+1 Maximum 56 14 EU10+1 Average 47 EU10+1 Minimum 35 28 EU15+2 Minimum 33 29 Serbia 28 30 -1 -1 6 6 10 10 0 2 3 3 4 4 Montenegro 27 31 -2 -2 -2 -2 3 2 0 -1 -1 -1 1 -1 Macedonia 24 32 -1 -1 -2 0 -2 -2 0 -1 0 0 -2 0 Albania 23 33 3 3 10 7 3 3 0 1 2 2 0 0 Turkey 16 34 -4 -4 -11 -10 -10 -10 0 -1 -3 -3 -3 -3 BiH 13 35 -1 -1 -6 -6 -4 -4 0 0 -1 -1 0 0

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In regard to the Governance category, Serbia is the best performer in the group – 30th place out of 35 and 28 points, followed by Montenegro – 31st with 27 point and then Macedonia – 32nd place with 24 points. In term of longer term trends, Serbia makes substantial progress by 4 positions up compared to 2011 and 2012 and 10 points in each of these years, then 3 positions up compared to each 2013 and 2014 with 6 points each and then 2 places up compared to 2015. Turkey registers substantial decrease in good governance positions and scores – 3 positions down compared to the period 2011-2014, 1 position down compared to 2015 with respectively loss in points – 10 points compared to each year from 2011 to 2013, 11 points down compared to 2014, and by 4 points compared to 2015 and 2016. Albania has some improvement mainly for the period 2013-2014 with more substantial gains in points – 7 and 10 additional points respectively.

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The Balkans: the catching-up by country in the Index 2017

The spider graphs show how the different countries are catching-up in Index 2017 compared to the average score of the two control groups – the older (EU15+2) and newer (EU10+1) EU member states – in regard to Economy, Quality of Life, Democracy and Governance. The graphs show also in what categories the countries fare better or worse compared to the other areas.

The result show that the candidate countries, which are all Balkan countries, are still very far from the desired levels defined by the old member states EU15+2. In the majority of cases, they are also far from the newer member states average score (EU10+1).

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Supplement I: Country Scores by Indicators and Categories

Catch-Up Index 2017: Economy Scores (in z-scores on a scale 100-0)* GDP per Government Credit Energy Information Research and Employment Market development Transport infrastructure Economy Scores capita debt ratings Intensity Society Development High-tech GDP per Employment as Energy Information Patents Economy General Sovereigns exports as % Doing Economic Motorways Motorways Other roads Other roads capita in PPS percentage of intensity of and granted by government credit of Business Freedom per area per 100000 per 1000 per 100000 Score with population, age the Communicatio USPTO per debt (% of GDP) ratings manifacture rank score 1000 km2 inhabitants km2 inhabitants EU27=100 group 15-64 economy n Technology capita d exports Country 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 Austria 66 41 73 65 66 59 69 54 64 61 53 61 51 53 61 Belgium 62 28 65 46 60 62 60 54 36 47 92 53 93 52 55 Cyprus 46 28 31 49 62 35 38 36 35 48 80 85 59 54 43 Denmark 65 67 79 72 72 80 84 60 81 70 59 61 53 50 70 Finland 58 53 73 60 54 67 98 43 72 67 34 54 37 62 61 France 57 34 67 51 63 67 61 89 55 33 53 56 57 57 56 Germany 64 50 79 72 65 71 86 63 66 66 69 53 55 41 66 Greece 40 0 10 24 62 48 37 50 22 7 40 44 40 39 31 Ireland 88 47 56 51 73 64 61 96 68 75 45 60 50 65 68 Italy 53 14 42 35 67 47 47 39 41 31 55 44 43 34 43 Luxembourg 100 76 79 53 68 72 61 38 25 73 97 77 47 35 74 Malta 52 56 54 53 68 59 39 100 6 47 31 22 100 38 54 Netherlands 67 53 79 72 64 74 73 71 54 72 100 54 75 40 68 Portugal 44 15 34 52 61 44 36 34 57 31 66 80 35 28 41 Spain 51 32 45 40 65 57 39 39 58 34 63 87 37 32 48 Sweden 65 64 79 75 65 74 100 57 75 70 36 64 39 67 69 UK 58 38 67 69 68 77 61 76 78 74 47 34 54 38 61 Bulgaria 32 72 42 48 10 39 36 40 37 54 37 39 36 31 40 Czech Republic 49 67 60 66 43 50 39 56 56 65 41 37 53 49 54 Estonia 43 83 60 67 25 67 43 47 73 83 34 44 49 100 57 Hungary 40 46 39 55 45 39 39 55 39 41 52 60 60 65 44 Latvia 39 65 51 59 49 47 36 59 66 69 31 22 44 82 51 Lithuania 43 66 51 61 50 47 36 50 69 72 36 43 49 82 52 Poland 41 58 51 51 46 38 36 42 59 49 36 30 49 47 46 Romania 36 67 39 45 46 30 36 39 42 53 34 30 38 34 42 Slovakia 44 59 57 51 48 44 36 47 48 41 41 39 44 41 48 Slovenia 47 44 52 53 54 50 40 37 50 20 71 95 56 61 49 Croatia 36 41 31 35 52 46 36 43 37 21 55 83 39 37 39 Macedonia 27 66 29 18 28 24 35 25 74 56 42 47 40 39 36 Turkey 38 72 33 22 57 18 35 26 28 39 34 28 37 31 39 Montenegro 29 49 22 23 34 26 35 26 45 29 31 22 41 52 32 Iceland 67 58 53 97 1 82 77 80 63 68 31 29 35 100 62 Albania 24 47 22 34 47 3 35 24 23 37 41 41 35 28 29 BIH 24 63 15 0 6 9 35 27 4 24 34 29 38 35 24 Serbia 26 46 27 31 4 36 35 30 44 20 42 44 40 38 30 The table shows the standartized z-scores on a scale from 100 to 0, highest to lowest, for the 35 countries in the Index in the basic indicators in the respective category. Missing data was imputed following the methodology described in this report.

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Catch-Up Index 2017: Quality of Life Scores (in z-scores on a scale 100-0)* Human Welfare of Social issues Education Health Developm consumers ent Quality Actual Relative Share of of Life Healthy life individual Inequality - median at- Long term Share (%) of population PISA score in PISA score PISA score in Infant Life EuroHealth Human expectancy Score consumptio Gini risk-of- unemploym early school (%) with reading mathematic scientific mortality by expectancy Consumer Developme at birth in Quality of Life Scores n with coefficient poverty gap ent rate (%) leavers university literacy al literacy literacy age of 5 in years Index nt Index years EU27=100 (%) degree Country 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 Austria 76 66 62 63 62 57 56 63 61 69 60 64 71 63 66 Belgium 72 71 67 56 57 67 63 68 65 61 57 63 77 65 66 Cyprus 55 35 70 50 60 78 34 29 27 62 66 68 38 50 53 Denmark 73 66 60 65 61 63 64 71 65 61 54 61 71 75 68 Finland 73 75 79 62 59 74 78 71 81 60 69 66 74 64 70 France 70 58 71 54 57 62 63 60 61 74 57 72 69 65 65 Germany 79 52 71 64 54 46 69 68 69 62 58 60 75 76 68 Greece 45 38 35 12 63 51 47 38 39 68 58 63 33 53 46 Ireland 60 52 70 55 63 78 75 67 65 64 59 66 49 75 65 Italy 60 45 33 47 45 25 56 59 53 76 62 74 48 61 55 Luxembourg 86 60 74 62 65 75 54 56 54 67 68 72 75 65 70 Malta 48 63 67 63 31 33 36 53 44 66 37 68 45 50 51 Netherlands 70 70 70 61 59 62 66 71 69 71 58 66 88 75 70 Portugal 49 38 44 48 45 39 63 60 64 63 60 64 61 45 50 Spain 54 36 25 37 32 66 62 56 60 73 62 76 52 60 53 Sweden 70 75 48 65 61 73 64 61 60 69 64 71 65 71 67 UK 73 45 65 65 51 80 63 60 69 63 55 62 61 70 65 Bulgaria 27 26 6 54 45 46 28 31 34 17 32 18 22 27 28 Czech Republic 46 75 50 64 62 37 57 60 60 45 62 46 64 58 55 Estonia 40 35 53 62 52 70 74 76 83 41 64 41 55 53 53 Hungary 34 62 68 61 48 37 48 51 51 26 48 25 30 42 44 Latvia 37 33 50 56 54 59 58 54 58 24 53 19 32 40 42 Lithuania 52 22 43 59 67 70 49 52 50 14 48 17 37 47 46 Poland 43 52 51 62 66 48 67 67 64 38 52 37 28 49 50 Romania 34 24 15 59 34 24 29 33 28 21 22 20 17 29 29 Slovakia 45 81 36 50 61 35 39 50 42 33 43 32 47 46 46 Slovenia 43 78 66 55 67 53 67 70 71 61 69 61 57 62 60 Croatia 31 54 50 47 72 36 57 44 50 45 52 37 51 39 44 Macedonia 18 33 28 0 54 31 0 0 0 27 0 23 50 9 19 Turkey 33 5 42 62 0 26 26 19 22 15 0 42 20 16 25 Montenegro 27 47 39 24 65 28 26 18 14 31 58 30 21 31 33 Iceland 73 81 71 68 31 68 55 58 49 75 70 73 76 74 69 Albania 16 55 39 31 2 14 14 15 23 39 0 40 26 15 22 BIH 18 22 26 0 0 13 26 18 14 37 43 30 20 10 18 Serbia 21 21 4 28 60 27 28 31 34 29 44 22 46 20 26 The table shows the standartized z-scores on a scale from 100 to 0, highest to lowest, for the 35 countries in the Index in the basic indicators in the respective category. Missing data was imputed following the methodology described in this report.

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Catch-Up Index 2017: Democracy Scores (in z-scores on a scale 100-0)* Satisfaction Trust in Voice and Human E- with Democracy Indices Media Freedom People Accountability Rights participation democracy Press Economist Freedom of Democracy Freedom Freedom Political Satisfaction Intelligence the Press Voice and Score Trust in House score Index by Terror by E-participation with Unit score by Accountability - Democracy Scores people Freedom in Reporters Global index democracy % Democracy Freedom WGI the World without Peace Index Index House Borders Country 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 Austria 71 55 61 64 59 68 67 51 71 62 Belgium 67 51 62 54 72 69 70 66 38 62 Cyprus 38 28 61 51 58 54 57 36 21 49 Denmark 89 100 65 77 72 74 72 66 61 75 Finland 78 83 69 74 72 77 73 66 76 74 France 51 38 55 54 54 49 56 51 73 52 Germany 68 47 61 67 62 64 69 66 54 63 Greece 16 43 49 46 32 31 42 20 33 37 Ireland 71 64 63 76 64 66 68 51 47 66 Italy 30 51 54 57 48 41 53 51 76 50 Luxembourg 79 47 66 71 69 65 71 66 45 67 Malta 53 60 58 60 58 44 62 51 57 56 Netherlands 74 74 67 72 73 72 73 66 80 71 Portugal 68 43 65 55 66 63 60 66 40 60 Spain 37 62 61 59 52 57 55 51 78 56 Sweden 82 74 69 80 73 79 74 66 54 74 UK 54 59 61 66 56 49 65 66 88 61 Bulgaria 33 23 42 42 34 22 32 36 45 35 Czech Republic 58 43 59 51 61 60 54 66 26 56 Estonia 52 53 61 54 67 67 63 66 61 60 Hungary 45 43 31 36 32 35 30 51 16 36 Latvia 47 66 51 45 54 57 48 51 21 51 Lithuania 26 59 57 48 61 51 50 66 64 52 Poland 56 57 49 36 44 40 46 66 71 48 Romania 27 64 47 32 39 44 37 36 35 40 Slovakia 36 53 54 44 54 63 49 36 23 48 Slovenia 35 66 59 49 58 50 51 66 49 54 Croatia 20 40 50 35 36 34 38 66 57 41 Macedonia 50 13 12 18 7 21 10 20 33 19 Turkey 44 28 0 7 0 0 1 0 35 9 Montenegro 35 23 24 20 32 25 22 36 64 27 Iceland 74 76 62 83 68 69 69 36 40 67 Albania 35 23 26 25 23 33 24 20 38 26 BIH 28 17 8 7 23 37 13 51 18 20 Serbia 23 23 33 32 26 37 26 51 64 32 The table shows the standartized z-scores on a scale from 100 to 0, highest to lowest, for the 35 countries in the Index in the basic indicators in the respective category. Missing data was imputed following the methodology described in this report.

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Catch-Up Index 2017: Governance Scores (in z-scores on a scale 100-0)* Rule of E- Corruption Political Stability Government Regulations Conflict and tensions Law government

Political Governance Stability E- Corruption Control of Political and Governement Global Score Regulatory Rule of Homicide government Perception Corruption instability Absence Effectiveness Peace Quality (WGI) Law (WGI) rates (UN) Developmen Governance Scores Index (TI) (WGI) EIU of (WGI) Index t Index Violence (WGI) Country 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 100-0 Austria 67 69 69 59 69 67 72 77 67 67 62 Belgium 70 70 61 47 62 63 64 58 43 61 62 Cyprus 43 54 55 51 52 55 49 40 54 26 49 Denmark 85 77 66 60 78 69 74 70 59 73 75 Finland 84 77 61 67 75 75 75 64 49 78 74 France 60 68 47 29 66 55 65 58 49 72 52 Germany 74 71 69 57 72 75 67 64 61 67 63 Greece 30 32 52 26 32 20 31 28 61 43 37 Ireland 65 70 69 62 64 72 66 52 65 57 66 Italy 33 35 41 43 43 43 33 46 62 59 50 Luxembourg 74 75 69 84 70 71 69 75 59 58 67 Malta 43 52 41 76 50 58 57 46 59 52 56 Netherlands 77 72 69 63 74 78 73 64 65 75 71 Portugal 51 57 69 74 61 45 60 77 59 47 60 Spain 47 45 47 47 58 53 55 70 64 66 56 Sweden 83 76 69 68 72 76 76 70 56 76 74 UK 74 72 66 44 70 73 67 52 59 85 61 Bulgaria 26 27 47 32 35 41 26 46 45 33 35 Czech Republic 43 44 55 69 53 52 59 70 63 34 56 Estonia 61 62 47 54 57 70 62 46 22 69 60 Hungary 34 37 61 55 40 38 44 46 59 40 36 Latvia 45 43 52 45 52 56 55 46 7 41 51 Lithuania 48 49 47 57 56 57 56 46 0 58 52 Poland 51 53 24 49 46 50 48 40 63 48 48 Romania 34 34 61 41 14 37 34 52 51 19 40 Slovakia 38 39 55 52 49 49 49 52 61 24 48 Slovenia 50 54 69 70 58 40 57 58 55 59 54 Croatia 36 38 44 54 41 30 39 43 61 48 41 Macedonia 21 22 13 17 24 33 12 16 59 24 19 Turkey 26 26 2 0 22 22 20 0 4 24 9 Montenegro 31 30 13 36 26 25 25 28 30 40 27 Iceland 71 73 69 83 67 60 65 77 60 57 67 Albania 23 16 27 40 19 22 10 34 37 13 26 BIH 23 11 0 17 1 4 14 16 50 9 20 Serbia 27 21 41 33 23 13 21 34 57 47 32 The table shows the standartized z-scores on a scale from 100 to 0, highest to lowest, for the 35 countries in the Index in the basic indicators in the respective category. Missing data was imputed following the methodology described in this report.

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Supplement II: Country Abbreviations

EU28 - European Union with the 28 member states EU15+2 – the 15 member states before the 2004 enlargement plus Cyprus and Malta EU10+1 – the countries of the fifth enlargement in 2004, 2007 as well as Croatia in 2013 CC – Candidate countries PCC – Potential candidate countries

BE Belgium CZ Czech Republic BG Bulgaria DK Denmark D-E East Germany DE Germany D-W West Germany EE Estonia EL Greece ES Spain FR France IE Ireland IT Italy CY Republic of Cyprus * CY (tcc) Zone not controlled by the government of the Republic of Cyprus LT Lithuania LV Latvia LU Luxembourg HU Hungary MT Malta NL Netherlands AT Austria PL Poland PT Portugal RO Romania SI Slovenia SK Slovakia FI Finland SE Sweden UK United Kingdom HR Croatia TR Turkey MK Republic of Macedonia

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Supplement III: About the Catch Up Index. How is the “Catching-Up” Measured?

The Catch-Up Index is a composite index, using a specifically designed model developed by EuPI of OSI- Sofia. The Catch-Up Index includes 35 countries selected on a political criteria as it covers the 28 EU member states, the candidate and potential candidate countries. The only exception is Kosovo, as there is not enough comparable statistical data available about it and despite the efforts, the lack of data left Kosovo outside of the Index. The metric is based on rescaling the raw data on a scale from 0 to 100 (lowest to highest) to establish each country’s score, and ranking each country from 1 to 35 (highest to lowest). The standardized scores make possible different rankings, comparisons, benchmarking, monitoring of performance for countries and groups of countries across categories and indicators and contribute to policy analysis and recommendations. The Catch-Up Index contains four categories - Economy, Quality of Life, Democracy and Governance for the 35 countries included in the Index. There are scores for each category: Economy Score, Quality of Life Score, Democracy Score and Governance Score and each category has an equal weight with the other categories. There is an Overall Score, composed of the scores for the four categories. Each category is measured through selected indicators and sub-indicators. The various data for the indicators is converted into scores, weighted on the basis of the Index methodology. The indicator scores make up the scores for the four different categories. The weights have been attributed to the indicators or sub-indicators by the expert team, based on the importance assigned to them. The Catch-Up Index was initially designed to capture the progress of the EU10 countries in matching the rest of the EU in the categories of Economy, Quality of Life, Democracy and Governance. But the Index allows for much broader observations and findings to be made by examining the performance of the 35 countries, comparing them across the four categories and 47 indicators and sub- indicators, and eliciting conclusions from the interdependence between the factors that define the performance. The Index allows for what is essentially multi-dimensional mapping of present-day Europe by superimposing the four fundamental categories. The index data do not only indicate a country’s progress or degree of similarity relative to its peers, but also how far it is from the desired goals.

Benchmarking the EU10 In addition to the ranking of countries according to their score, there are also several benchmarks to help measure the catch up index - the average, maximum and minimum scores by groups. There are four main and one additional such benchmarks. First, there is the EU15+2 Average Score, calculated as the compare means scores of the 15 "old" EU member states plus Cyprus and Malta, which are considered as part of this group too ("Western" countries vs post-communist countries). Second, there is the EU15+2 Max (maximum) score of the highest ranking country in this group. Third, there is the

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EU15+2 Min (minimum) score of the lowest ranking country in this group. Fourth, there is the EU10 Average Score, calculated as the compare means scores of the 10 "new" EU member states scores. Fifth, there is the EU28 Average Score, calculated as the compare means of the scores of all 28 EU member states. Being aware of the limitations of Catch Up Index model and in order to provide readers with the opportunity to take advantage of the Catch-Up Index data, a special online platform has been created at www.TheCatchUpIndex.eu , where users can both view and work interactively with the data. The users of the platform can create their own “catching up” models and comparisons across countries and indicators, and visualize the outcomes in different ways.

The Economy category explained: Methodology notes The Economy category measures the economic performance and potential of the countries in the index. Each of the four categories in the Catch Up Index are ascribed equal importance in terms of calculating a country’s overall score. The Economy category is measured through a set of nine indicators, each of which captures a different aspect of economic performance. Some indicators gauge more than one aspect of economic performance. The metrics of the indicators are based on 14 sub-indicators, of varying weightings. The specific indicators and the weightings assigned to the sub-indicators reflect the unique model of the Catch Up Index. The raw data used for the indicators (e.g. GDP per capita or other composite indicator scores or coefficients) are converted into a Catch-Up Index score on a scale of 0 to 100 (lowest to highest) to allow for a standardized score that can be compared across countries or categories and indicators. Each of the indicators has different weight assigned to it, according to its importance in the Catch Up Index model.

Economy Indicators Sub-indicators Weight*

GDP per capita GDP per capita in PPS, EU28=100 25% (0,25)

Government debt General government debt (% of GDP) 13% (0,125)

Credit ratings Sovereign credit ratings 13% (0,125)

Employment Employment rate % 8% (0,083)

Energy Intensity Energy intensity of the economy 8% (0,083)

Information Society Information and Communication Technology 8% (0,083)

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Patents granted by USPTO per capita 4% (0,042) Research and Development High-tech exports as % of manufactured exports 4% (0,042)

Doing Business rank 4% (0,042) Market development Economic Freedom score 4% (0,042)

Motorways per area 1000 km2 2% (0,021)

Motorways per 100,000 inhabitants 2% (0,021) Transport infrastructure Other roads per 1000 km2 2% (0,021)

Other roads per 100,000 inhabitants 2% (0,021)

***The weight in percentages is an approximation, and the weight is also provided in fractions (the total sum is 100% or 1).

GDP per Capita (PPS with EU28=100 basis, Eurostat) remains the most important indicator of economic activity and is assigned 25% (0.25) weight in the total Economy category.

The Sovereign Credit Ratings – or creditworthiness and level of investment risk - of a country are also attributed high importance in the index, with a 12.5% (0,125) weight. The index uses a composite, rescaled score of the ratings of the three major agencies (Fitch, Moody’s and Standard & Poors).

Employment, with a weight of 8% (0,083) is a measure of an economy’s potential to generate jobs and integrate as much as possible of the labor force in the labor market; this is measured through the share of working-age people in employment.

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Research and Development, again with a weight of 8% (0,083) is a measure of the level of development and the “quality” of contemporary economies, including their competiveness. The index uses two sub- indicators. The first is the number of patents registered from a country with the United States Patent and Trademark Office (USPTO) annually on a per capita basis. The second indicator is the share of high- tech exports in a country’s manufactured exports.

The Market Development indicator (also 8% (0,083)) is the composite score of two sub-indicators – the World Bank’s Ease of Doing Business ranking and the Heritage Foundation/Wall Street Journal Index of Economic Freedom. The latter defines the highest form of economic freedom as “an absolute right of property ownership, fully realized freedoms of movement for labor, capital, and goods, and an absolute absence of coercion or constraint of economic liberty beyond the extent necessary for citizens to protect and maintain liberty itself.”

The Transport Infrastructure Indicator (8% (0,083)) is a measure of a country’s economic development and its potential for economic activity. The index uses four sub-indicators, based on calculating coefficients of motorways and other roads on a per capita and country area basis.

The ingredients of democracy: Methodology notes Catching up in Democracy is essential for the post-communist member states of the EU, particularly given that the Copenhagen accession criteria for EU membership primarily focused on democracy. But although EU membership has often been perceived as a watershed in the political transition of the EU10 group, or even the end of that transition, it now appears that the newer members may not have achieved parity with more developed European nations in their progress in building democratic institutions and societies. The Catch-Up Index was designed to analyse several aspects of democracy that are of particular significance for the newer member states, and those that are aspiring to be. The Democracy category has equal weighting with the other three categories in the Catch-Up Index (Economy, Quality of Life and Governance). This category is measured through a set of seven indicators, which use nine sub-indicators. The raw data drawn from opinion polls and other composite indicator scores are converted into the Catch-Up Index score on a scale of 0 to 100 (lowest to highest) to give a standardized score that allows for comparison across countries, categories and indicators. Each of the indicators has a different weight assigned to it according to its importance in the index model.

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Democracy Indicators Sub-indicators Weight

Freedom House score Freedom in the World 20% (0,195) Democracy Indices Economist Intelligence Unit Democracy Index 20% (0,195)

Freedom House Freedom of the Press score 10% (0,98) Media Freedom Reporters without Borders Press Freedom Index 10% (0,98)

Satisfaction with democracy Satisfaction with democracy % 10% (0,98)

Trust in People Trust in people 10% (0,98)

Voice and Accountability Voice and Accountability - WGI 10% (0,98)

Human Rights Political terror by Global Peace Index 10% (0,98)

E-participation E-participation index 2% (0,024)

***The weight in percentages is an approximation, and the weight is also provided in fractions (the total sum is 100% or 1).

The first indicator used to measure democracy is composed of two established composite democracy indexes – those of Freedom House and the Economist Intelligence Unit (EIU). Each was attributed very high importance in the Democracy category with 20% (0,195) weight (or 40% for both) because they assess the overall democracy in a country. The Freedom of the World index was used from Freedom House, rather than the specialized post-communist states’ Nations in Transit index, because it does not encompass the Western European states. The EIU Democracy Index was used because its scores are more nuanced than the Freedom of the World scores, which allows for better distinction between the quality of democracies in the European states. Media Freedom was attributed special attention in the Catch-Up Index because the media is essential to the democratic process – especially in the post-communist states. The Catch-Up Index relies again on two established media freedom indexes – of Freedom House and of Reporters without Borders. Each is assigned 10% (0,98) weight, giving the Media Freedom indicator a 20% overall weight. Satisfaction with Democracy measures the attitude of citizens towards the democratic systems of governance in their countries. This is one of the only two indicators (along with Trust in People) that relies on public opinion surveys (in this case the main source is Eurobarometer), and the scores are based on the proportion of citizens who approve their countries’ democratic systems. Trust in People measures the level of people’s trust of those who are outside of their immediate family or close friends. Literature abounds on the importance of trust for democracy - above all Francis Fukuyama’s “Trust”,– or economy and the successful organization of society. In this case, the Catch-Up Index employs the measure of Trust in People as a proxy for civil society development, given the limitations of available data on similar indicators for all the countries in the index.

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Voice and Accountability, with a weight of 10% (0,98) , is a composite indicator of the World Bank’s World Governance Indicators (WGI). This includes perceptions of the extent to which a country's citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and a free media. The WGI scores also use World Bank assessments and reports that are not publicly available. Absence of Political terror is also deemed essential for a functioning democracy and carries a weight of 10%. The scores are based on Global Peace Index “Political terror” indicator, e.g. identifying state terror, or violations of physical and personal integrity rights carried out by the state. E-participation (2% (0,024)) measures the level of participation in decision-making, governance or similar activities that is enabled by Information and Communication Technologies. For example, the facilitation of citizens’ political participation through internet or cellular technologies within the broader “e-democracy” concept. Facebook advocacy or the “twitter revolutions” offer specific examples of similar phenomena.

Quality of Life: Methodology notes Quality of Life is the category most influenced by the “bottom-up” approach in constructing the index. The metrics of the category have been designed to establish how wealthy people are and to what degree social issues affect them, such as income inequality, risk of poverty and long-term unemployment. The indicators also aim to assess levels of access to higher education and the quality of education available, as well as whether people are living longer, healthier lives with access to good quality healthcare services. These criteria are prerequisites for individuals to have good quality of life and for the “health” and successful development of society at large. It does not come as a surprise that the majority of the citizens of the newer member states (and the candidates) associate EU membership above all with improved quality of life, at least closer to that of their more established EU counterparts. The raw data used for the indicators (e.g. life expectancy in years, and other composite indicator scores or coefficients) are converted into the standardized Catch-Up Index score, on a scale from 0 to 100 (lowest to highest), to allow for comparison across countries’ categories and indicators. As was the case in the other categories, each of the indicators has a different weight assigned to it, reflecting its importance in the Catch-Up Index model.

Quality of Life Indicators Sub-indicators Weight

Welfare of consumers Actual individual consumption with EU28=100 20% (0,2)

Social issues Inequality - Gini coefficient 7% (0,067)

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Relative median at-risk-of-poverty gap (%) 7% (0,067)

Long-term unemployment rate (%) 7% (0,067)

Share (%) of early school leavers 5% (0,05)

Share of population (%) with university degree 5%(0,05)

Education PISA* score in reading literacy 3% (0,033)

PISA score mathematical literacy 3% (0,033)

PISA score in scientific literacy 3% (0,033)

Healthy life expectancy at birth in years 5% (0,05)

Life expectancy in years 5% (0,05) Health Infant mortality by age of 5 5% (0,05)

EuroHealth Consumer Index 5% (0,05)

Human Development Human Development Index (UN) 20% (0,2)

* Programme for International Student Assessment (OECD).

**The weight in percentages is an approximation, and the weight is also provided in fractions (the total sum is 100% or 1).

Welfare of Consumers is attributed 20% (0,2) weight in the category. It is based on data from Eurostat’s Actual Individual Consumption dataset, which is calculated on EU28=100 basis (rescaling each country’s data as a fraction of the EU mean). The Social Issues indicator, with a total weight of 21%, comprises three sub-indicators that measure different aspects of social problems in a society. The first assesses social inequality using the Gini coefficient – the greater the inequality, the lower a country’s score in the index. The second sub- indicator is based on Eurostat’s relative median at-risk-of-poverty gap indicator. The third sub-indicator measures long-term unemployment in society, which signals the existence of more deep-seated social problems that the basic unemployment rate. The Education indicator has been designed to reflect primarily the quality of education, rather than the quantity, given that the GDP share of education or the number of teachers or students do not always correspond to good outcomes. This is especially valid with regard to the new member states, where often inefficient and unreformed systems produce poor results, notwithstanding the funds or manpower channelled into them. As is the case with many of the index indicators, their data can also be useful in assessing other aspects of the same category or, in this case, other categories. For example, as well as being a key indicator for

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Quality of life, education is relevant in assessing economic potential, democracy and good governance. The sub-indicator on early school-leavers assesses the share of young people giving up education and training prematurely; this may also help to gauge broader social problems. The second sub-indicator is the share of the population that hold university degrees. The next three education-related sub- indicators are based on the results of the Organisation for Economic Co-operation and Development’s Programme for International Student Assessment (PISA). The PISA scores go beyond the performance of high-school students and survey the broader state of a country’s education sector, for example qualification levels of teachers and the quality of universities. The Health indicator is likewise designed to focus more on the outcomes than on less indicative criteria such as share of GDP or the number of medical workers. One sub-indicator is life expectancy, measuring how many years a person is expected to live, while another is healthy life expectancy, specifically taking into account life without major illness. The indicator for infant mortality is also indicative of the broader state of health services or social services in a country (or even the state of society more broadly) because it assesses the likelihood of children surviving to the age to 5. The fourth sub-indicator is a composite of the EuroHealth Consumer Index by the Health Consumer Powerhouse, which measures the quality of healthcare systems in a country (including by outcome).

Governance category explained: Methodology notes The newer and aspiring members typically perceive established EU member states to be well-governed, politically stable, have low levels of corruption, effective governance, a successful rule of law, and an absence of substantial tensions, conflicts and crime. Indeed, from a wider perspective this impression is accurate. The EU is truly an oasis of stable and well-governed states by comparison with some of the more unstable or failing states in other parts of the world. The EU is very much geared toward instilling “good governance” through its common institutions and the acquis communautaire. But comparisons between EU members and aspiring candidates reveal differences even among relatively homogenous groups. Some of these differences are made strongly apparent, as in the case of the EU’s monitoring of the progress of members Bulgaria and Romania in fighting corruption, organized crime and judicial reform, and the conditionality imposed on candidates. The Catch-Up Index measures the quality of governance in a country through seven indicators based on ten sub-indicators.

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Governance Indicators Sub-indicators Weight

Corruption Perceptions Index - Transparency International 8% (0,08) Corruption Control of Corruption - World Governance Indicators 8% (0,08)

Political instability by Economist Intelligence Unit 8% (0,08)

Political stability Political Stability and Absence of Violence - World Governance 8%(0,08) Indicators

Government Government effectiveness - World Governance Indicators 16% (0,16) effectiveness

Regulatory quality Regulatory quality - World Governance Indicators 16% (0,16)

Rule of law Rule of Law – World Governance Indicators 16% (0,16)

Conflicts and tensions in the country - selected Global Peace 8% (0,08) Conflict, tensions and Index indicators crime Homicide rates per 100,000 population 8% (0,08)

E-government E-government development index 4% (0,04)

*The weight in percentages is an approximation, and the weight is also provided in fractions (the total sum is 100% or 1)

The Corruption indicator is essential for gauging the quality of governance because corruption affects all aspects of the decision-making and implementation process. The Corruption indicator has a weighting of 16% in the Governance category, divided between two sub-indicators – Transparency International’s Corruption Perceptions Index and the Control of Corruption dimension of the World Bank’s World Governance Indicators. The first indicator measures public perceptions of the level of corruption in a country. The second indicator as defined by its authors “captures perceptions of the extent to which public power is exercised for private gain, including both petty and grand forms of corruption, as well as "capture" of the state by elites and private interests.” The second indicator measures a country’s level of Political stability, as in the threat of government destabilization through social unrest or unconstitutional or violent means through two sub-indicators. These are the Economist Intelligence Unit’s Political Instability Index and the Political Stability and Absence of Violence dimension of the World Bank’s World Governance Indicators. The EIU scores “show the level of threat posed to governments by social protest.” The World Bank indicator measures “the perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including domestic violence and terrorism.” The level of political stability indicates any flaws in governance. Although this indicator also relates to democracy – in terms of the channelling of discontent through the process of representation and problem solving – political

86 www.TheCatchUpIndex.eu The Catch-Up Index 2017 stability is more of a measure of governance. The indicator‘s weight is 16% divided between the two sub-indicators. Government effectiveness is an indicator of whether governance is being conducted well; the World Bank states that it “captures perceptions of the quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government's commitment to such policies.” Government effectiveness also has a weighting of 16% in the Governance category. Regulatory quality is another World Governance Indicators that “captures perceptions of the ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development.” This indicator too has a 16% weighting. Rule of law is essential for good governance, as the newest EU members and candidates have found out the hard way. The indicator is again based on the World Governance Indicators, which state that it “captures perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence.” Conflict, tensions and crime is a composite indicator, based on two sub-indicators relating to a country’s crime levels and conflicts and tensions. The conflicts and tensions sub-indicator is based on selected data from the Global Peace Index (Institute for Economics and Peace/Economist Intelligence Unit). The homicide rate on a per capita basis serves as a proxy for measuring the crime levels in a country, because data pertaining to other reported crimes is less easily comparable (different definitions or practices for registering crimes) or country data is unavailable. The indicator’s weight of 16% is divided between the two sub-indicators. The E-government indicator is based on the UN’s E-government surveys and scores. It is included in the index because it is a measure of government efficiency and delivery of services to citizens, and because it facilitates transparency and accountability as the world grows more connected. Moreover, e- government indicates the level of development of contemporary societies. As the UN survey has identified, the scores comprise two basic aspects of e-government, ‘government to citizen’ (G to C) and ‘government to government’ (G to G), with a smaller element of ‘government to business’ interactions. Given that e-government is indicative of many aspects of good governance, but not indispensable, it is ascribed a weight of 4%.

Note on data sources, timeframe and replacing missing data The Catch-Up Index data collection relied on single sources for each of the indicators, but in case such data was missing, compatible data from other sources based on the same methodology was included. If country data for a specific year was missing, data from the closest period was included in the Index. In case there was no compatible data, the data imputation method was used as explained in the methodological notes. The missing data was replaced using either the statistical procedure, described in the annex or in a limited number of cases - expert-based imputations. In the case with the Index when

87 www.TheCatchUpIndex.eu The Catch-Up Index 2017 the data set is about multiple countries, missing data for a given country was replaced with data for a country with very similar characteristics. Where a single sub-indicator included several sources or the data was not numerical (e.g. Credit Agencies Index; Doing Business ranking), the data was rescaled in advance by the project team before being recalculated into z-scores. The data used was mainly released in 2017 and it is the most recently available, but not later than 31 January 2018 so there is necessarily a time lag in the index.

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Economy Sub-indicators Weight Sources Indicators

GDP per capita in PPS with 0,250 Eurostat, European Central Bank, GDP per capita EU28100 national statistics

Government General government debt 0,125 Eurostat, national statistics debt (% of GDP)

Fitch, Moody’s, Standard and Poor's Credit ratings Sovereigns credit ratings 0,125 (own calculations of rescaled credit ratings)

Employment as percentage Employment of population, age group 15- 0,083 Eurostat, national statistics 64 Energy intensity of the Energy Intensity 0,083 Eurostat, national statistics economy

Information Information and ICT Development Index, International 0,083 Society Communication Technology Telecommunication Union

Patents granted by USPTO United States Patent and Trademark 0,042 Research and per capita Office Development High-tech exports as % of 0,042 World Bank manifactured exports

Ease of Doing Business, World Bank Doing Business rank 0,042 Market (Rescaled ranking) development Index Economic Freedom, Heritage Economic Freedom score 0,042 Foundation and Wall Street Journal

Motorways per area 1000 0,021 Eurostat, national statistics km2

Motorways per 100000 0,021 Eurostat, national statistics Transport inhabitants infrastructure Other roads per 1000 km2 0,021 Eurostat, national statistics

Other roads per 100000 0,021 Eurostat, national statistics inhabitants

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Democracy Sub-indicators Weight Source Indicators Freedom House score Freedom in the World, Freedom House Democracy Freedom in the World 0,195 Indices Economist Intelligence Unit Democracy Index, Economist 0,195 Democracy Index Intelligence Unit Freedom of the Press score 0,098 Freedom of the Press, Freedom House by Freedom House Media Freedom Press Freedom Index by Press Freedom Index by Reporters 0,098 Reporters without Borders without Borders Satisfaction Satisfaction with democracy Eurobarometer, European Values 0,098 with democracy % Study, World Values Survey European Quality of Life Survey by Trust in People Trust in people 0,098 Eurofound, European Values Study, World Values Survey Voice and Voice and Accountability - Voice and Accountability of the World 0,098 Accountability WGI Governance Indicators, World Bank Political terror indicator, Global Peace Political terror by Global Human Rights 0,098 Index by the Institute for Economics Peace Index and Peace E-government survey, United Nations E-participation E-participation index 0,024 Department of Economic and Social Affairs

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Quality of Life Sub-indicators Weight Sources Indicators

Welfare of Actual individual 0,200 Eurostat, national statistics consumers consumption with EU28=100

Inequality - Gini coefficient 0,067 Eurostat, national statistics

Relative median at-risk-of- 0,067 Eurostat, national statistics Social issues poverty gap (%)

Long term unemployment 0,067 Eurostat, national statistics, UNDP rate (%)

Share (%) of early school 0,050 Eurostat, national statistics, UNDP leavers

Share of population (%) with 0,050 Eurostat, national statistics, UNDP university degree

OECD Programme for International Student Education PISA score in reading literacy 0,033 Assessment (PISA)

PISA score mathematical OECD Programme for International Student 0,033 literacy Assessment (PISA)

PISA score in scientific OECD Programme for International Student 0,033 literacy Assessment (PISA)

Healthy life expectancy at World Health Statistics, World Health 0,050 birth in years Organization

World Health Statistics, World Health Life expectancy in years 0,050 Organization Health World Health Statistics , World Health Infant mortality by age of 5 0,050 Organization

EuroHealth Consumer Index, Health EuroHealth Consumer Index 0,050 Consumer Powerhouse

Human Human Development Index 0,200 Human Development Index, United Nations Development

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Governance Sub-indicators Weight Sources Indicators

Corruption Perception Index, Corruption Perception Index 0,080 Transparency International Corruption Control of Corruption - World Control of Corruption - World 0,080 Governance Indicators Governance Indicators, World Bank

Political instability by The Political Instability Index, 0,080 Economist Intelligence Unit Economist Intelligence Unit Political Stability Political Stability and Absence Political Stability and Absence of of Violence - World 0,080 Violence - World Governance Governance Indicators Indicator, World Bank

Government Government Effectiveness - Government Effectiveness - World 0,160 Effectiveness World Governance Indicators Governance Indicators, World Bank

Regulatory Regulatory Quality - World Regulatory Quality - World 0,160 Quality Governance Indicators Governance Indicators, World Bank

Rule of Law - World Rule of Law - World Governance Rule of Law 0,160 Governance Indicators Indicators, World Bank

Conflicts and tensions in the country, Conflicts and tensions in the based on selected Global Peace Conflict, country - selected Global 0,080 Index (GPI) indicators, GPI is created tensions and Peace Index indicators by the Institute for Economics and crime Peace Homicide rates per 100,000 United Nations Office on Drugs and 0,080 population Crime

E-government development E-government Development Surveys, E-government 0,040 index United Nations

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Supplement IV: Methodology of the Statistical Analysis for the Catch-Up Index

1. Basic Indicators. Sources of information

The Catch-Up Index uses 47 basic indicators for 35 European countries. The data is gathered from different sources. Supplement III: “About the Catch-Up Index. How is the “Catching-Up” Measured?” contains descriptions for each of the basic indicators as well as the time period of the data and their respective sources. The indicators are divided thematically into four categories:

. Economy – 14 indicators; . Democracy – 9 indicators; . Quality of Life – 14 indicators; . Governance – 10 indicators.

2. Procedure for replacing missing data (Data Imputation)

The basic information represents a table (a matrix), size 35 x 47, i.e. 47 indicators for 35 countries, which contain 1,645 absolute values. About 0.5% of them are missing values either because there is no such information gathered or there is no up-to-date data. In these cases, the procedure for data imputation to replace missing data – values – was applied. The procedure was done separately for each of the four basic categories.

Algorithm for data imputation

a. Any of the four categories that contain a basic indicator with a missing value is fixed. It represents a matrix with a size of 35 multiplied by the number of basic indicators, where the countries are in the rows and the indicators are in the columns. b. All indicators (rows) that contain at least one missing value are deleted, thus creating a new matrix with the same number of rows and a smaller number of columns (k). c. Each of the 35 countries included in the index is a point in the k-dimensional space. The Euclidian distances between the side with a missing value and all the other sides are then calculated. d. After the minimal Euclidian distance is calculated, the result is checked against the existing data for the remaining 34 countries and this value is taken to replace the missing value. e. The steps are then repeated until all missing values of the basic indicators in a given category are replaced.

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3. Calculation of standardized value (z-scores)

The Catch Up Index uses basic indicators with different raw data (percentages, diverse index scores, years, etc.). This necessitates the standardization of the values according to a statistical procedure, which recalculates them in one and the same scale and at the same time preserves the order and proportions between them. The standardizing is done following the normalization method of z-scores, which uses mean weighed score and standard deviation.

Algorithm for calculating the standardized values of the basic indicators (z-scores)

4. The mean arithmetic values mean_j for the countries x_ij are calculated for each of the basic indicators, according to the formula:

mean_j = Σ (x_ij)/ 35

where j varies from 1 to 47 (the total number of basic indicators), and i changes from 1 to 35 (the total number of countries).

5. The dispersions for the values on sides x_i is calculated for each of the indicators:

sigma_j = Σ [(x_ij−mean_j)^2] / (N−1),

where j varies from 1 to 47, and i varies from 1 to 35.

This quantity shows how diverse are, on average, the different cases from their mean value.

6. The standardized values – so-called z-scores – are calculated:

z_ij = (x_ij−mean_j) / √sigma_j.

Through this procedure the distribution of the values for the countries for each of the indicators is translated and the mean 0 and dispersion 1 are calculated, while the order and proportions between the values for the different countries are preserved.

In order to transform the standardized values into scores on a scale from 0 to 100, one more transformation is necessary:

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z_ij = z_ij * 20 + 50.

The values smaller than 0 and bigger than 100 (“extreme values”), i.e. those different from the mean value of more than 2.5 standard deviation receive scores 0 and 100, respectively.

The standardized values, achieved as a result of the calculations above, are suitable for further procedures. There is a simple correspondence between these scores and the absolute values (the raw data) of the basic indicators and the only exceptions are the “extreme values” or so- called outliers.

7. Weighting the standardized values. Formation of the four categories Each of the four categories – Economy, Quality of Life, Democracy and Governance contain different numbers of basic indicators with different levels of importance. The level of importance is defined by the authors of the index. That is why the online platform of the Index (www.TheCatchUpIndex.eu) offers two options for its users.

a. The standard index is calculated on the basis of the already defined weights of the basic indicators; b. The creation of custom index – My Index in the online platform – for which each individual user can define the weights for the indicators.

The weights for each indicator, ascribed by the research team, can be found in this section. For each of the four categories, the weights represent a column vector consisting of the respective number of basic indicators. When calculating the weighted standardized values, the formula for matrix multiplication is used. The matrix contains the non-weighted standardized values with rows representing the countries, the columns the basic indicators and the vector the weights. For each separate country, the procedure is to calculate the weighted sum.

8. Formation of the composite Catch Up Index and its Overall Score

The composite Catch Up Index is calculated as an un-weighted mean of the values of each of the four basic categories for each of the 35 European countries included in the index. In other words, each of the four basic categories is equal in importance in respect to the composite Catch Up Index.

Overall_score_i = (Economy_score_i + Quality_of_life_score_i + Democracy_score_i + Governance_score_i) / 4,

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where i varies from 1 to 35 (the total number of countries in the model).

The resulting index is at the basis of the overall ranking of the countries and is subjected to further statistical processing (cluster analysis, correlation analysis, tests for statistical significance, trend analysis).

9. Cluster analysis The research included hierarchical agglomerative cluster analysis of the Complete Linkage (Furthest Neighbor) with the help of the SPSS statistical package for analysis and processing of data. The metric system used is the standard Euclidian distance.

Algorithm of the cluster analysis

a. First, each country is the defined as the only one in a single group – i.e. cluster. b. Second, the standard Euclidian distances (2-norm distance) are calculated between the values (the scores) of each pair of countries with the aim to group the countries with the most similarities in one group in relation to their values – the overall score of the Catch Up Index or the scores in any of the four categories. c. The agglomeration of the clusters continues with each other step until all the countries are included in one common group. This process is defined by the distance between two clusters. In the case of the Complete Linkage (Furthest Neighbor) clustering the distance is defined through the maximum standard Euclidian distance between elements from the two clusters. a. D(r,s) = Max {d(i,j) : where element i belongs to cluster r, and j to cluster s}

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d. The decision for the number of clusters is taken by the researcher, in accordance with the desired maximum distance between the elements in each cluster. The bigger the distance, the smaller the number of clusters. e. The cluster analysis is best represented in a dendrogram, which shows the distances between the different clusters as well the elements they are composed of.

10. Tests for statistical significance of differences. The five point rule.

The data on the basis of which the Catch Up Index is calculated are bound to have certain errors. The reason is that some of the basic indicators are based on sociological surveys, others though objective (e.g. GDP per capita) also contain certain errors as a result of the method of their calculation. The procedure for missing data replacement also contributes to the size of the overall error. This necessitates the implementation of tests for statistical significance of differences (compare means) between the different standardized values (z-scores) of the Overall Score and the scores of countries in different categories. The results of these tests show that a difference of five or less standardized scores is not statistically significant with a significance level of α = 0.05. This means that with a confidence level γ = 1−α = 0.95 = 95% it can be claimed that the standardized values of the countries in the Catch Up Index and the four categories vary within ±5 z-points. This conclusion should be taken into account when analyzing the results of the cluster analysis.

11. Correlation analysis

The Pearson correlation coefficients are calculated for each of the pairs in the vectors: Overall Score, Economy Score, Quality of Life Score, Democracy Score and Governance Score. They demonstrate that at a significant level α = 0.01, each of the two pair vectors have strong linear correlation, with each correlation coefficients are bigger than 0.9.

12. Graphs, linear trends and their confidence intervals

The direct consequence of the correlation analysis is that between two of the five indices – i.e. Overall Score, Economy Score, Quality of Life Score, Democracy Score and Governance Score – there is a strong direct correlation, which is represented by a corresponding linear trend (straight line with a positive slope).The coefficients in the equations of these straight lines are calculated using the method of linear regression. Each of the straight lines should be observed and analyzed in the corresponding confidence interval, which is determined by the value of their determination coefficient (R-square), which in this case is equal to the square of the respective Pearson correlation.

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The European Catch-Up Index Project

Catch-Up Index methodology

Georgi Stoytchev, Assya Kavrakova, Georgi Angelov, Marin Lessenski

Consultants in methodology development

Alexey Pamporov, Boyan Zahariev, Svetla Avramova, Georgi Ganev, Ognyan Minchev, Petko Georgiev, Georgi Prohasky, Daniel Smilov, Duhomir Minev, Dessislava Nikolova, Liliana Dudeva, Kaloyan Staykov

Statistical processing

Petya Brainova, Dragomira Belcheva

Catch-Up Index online platform at www.TheCatchUpIndex.eu

Sirma Group Corp.

Project manager

Marin Lessenski

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About the author

Marin Lessenski is Program Director of the European Policies Program of the Open Society Institute – Sofia. He holds an MA in Southeast European Studies from the Central European University - Budapest and an MA in History from the University of Sofia. He has been a Freedom House Visiting Fellow with the Hudson Institute's Center for European and Eurasian Studies and the Center of National Security Studies. He has also been a participant in the Transatlantic Young Leaders Program of the Aspen Institute - Berlin.

At OSI-Sofia he is responsible for the Catch-Up Index, which measures the convergence or divergence of European countries along key economy, democracy, governance and quality of life indicators, with a focus on CEE. His areas of interest also include EU's foreign, security, neighbourhood and enlargement policy, Southeastern Europe and the Black Sea region. He has been working with ECFR since 2007.

Contact: [email protected]

Web: www.osis.bg www.eupi.eu www.TheCatchUpIndex.eu

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About EuPI

The European Policy Initiative (EuPI) of OSI-Sofia aims to stimulate and assist new European Union Member States from Central and Eastern Europe to develop capacity for constructive co-authorship of common European policies at both government and civil society level. As a priority area of the European Policies Program of the Open Society Institute – Sofia, EuPI will contribute to improving the ability of new member states to effectively impact common European policies through good quality research, policy recommendations, networking and advocacy. The initiative operates in the ten new member states from CEE through a network of experts and policy institutes.

Web-site http://www.eupi.eu

Web-site: http://www.TheCatchUpIndex.eu

E-mail: [email protected]

Main research reports:

“Common Sense Wanted: Resilience To ‘Post-Truth’ And Its Predictors In The New Media Literacy Index 2018”

“Can this be true? Predictors of media literacy and resilience to the post-truth phenomenon in Europe”

“Don’t Stop Now Findings of the European Catch-Up Index 2016” contains the findings of the Catch-Up Index 2016 edition.

“Don't Panic: Findings of the European Catch-Up Index 2015” contains the findings of the Catch-Up Index 2015 edition.

“The Gravity Effect: Findings of the European Catch-Up Index 2014”, contains the findings of the Catch- Up Index 2014 edition.

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“It’s a Process: Findings of the European Catch-Up Index 2013” contains the findings of the Catch-Up Index 2013 edition.

“Aftershocks: What Did the Crisis Do to Europe?” contains the findings of the Catch-Up Index 2012 edition.

“State of the Union: A Big Bang Theory of Europe” contains the findings of the first edition of the Catch- Up Index 2011.

“The Unfinished Business of the Fifth Enlargement Countries” analyzes the problems faced by the ten new member states after their accession to the EU in eleven policy areas including political development, the economy, the healthcare system and education.

A series of reports "The EU New Member States as Agenda Setters in the Enlarged European Union" look at the positions of the new Central and Eastern European EU Member States on a selected number of issues on the EU agenda in seven policy areas: economic issues, minority integration, energy and climate, common agriculture policy, foreign and security policy, justice and home affairs and institutional issues.

The publication "Economic and Political Challenges of Acceding to the Euro area in the post-Lehman Brothers’ World" (Summary report and nine Country Reports) is developed within the project “Economic and Political Challenges of Acceding to the Euro area in the post-Lehman Brothers’ World”.

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www.TheCatchUpIndex.eu A special online platform was created at www.TheCatchUpIndex.eu, where users can view and work interactively with the data of the index, make comparisons across countries and indicators and visualize the outcomes in different ways.

There are basically three modes of usage. There is the Catch-Up Index standard format, which is generated on the basis of EuPI'sown model. Alternatively, users can produce their own custom catch-up index by selecting categories and indicators and changing their weights. The third usage mode allows for country by country comparison across selected indicators or benchmarks.

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