1.1. Together for resilient, sustainable and integrated economies
Strengthening the economic links constitutes a vital part of the Eastern Partnership, contributing to more resilient regional economies. However, many differences remain in the speed, depth and instruments used for the economic integration within the EaP. Tentatively, we can define two domains: the spheres in which all or almost all EaP countries are heading in the same direction, and spheres, in which we see a clear differentiation between the so-called Association Trio (Georgia, Moldova and Ukraine) and other EaP countries.
The EU, the most significant economic bloc in the region, has broadly maintained or even increased its role as a trade partner for the studied EaP countries (Armenia, Azerbaijan, Georgia, Moldova and Ukraine). At the same time, the access to the EU market and regulatory approximation related to trade in goods differ substantially within the EaP.
The Association Trio has gradually progressed with the deeper integration into the EU market, although each country have different priorities and, thus, achievements. Georgia and the EU have mutually established duty-free access to their markets while reducing non-tariff barriers to trade has been slower. Recently Georgia got the authorization to export snails and fishery products intended for human consumption to the EU. The EU-Moldova trade flows have remained not thoroughly liberal due to the use of tariff rate quotas. However, Moldova’s exporters recently got the authorization to ship raw milk to the EU market, in addition to snails and fishery products. Tariff rate quotas are also present in Ukraine’s trade with the EU. In the non-tariff barrier domain, Ukraine already has access to the EU market for ten chapters of food animal products and welcomed the EU expert mission for accessing the country’s readiness to launch talks on the Agreement on conformity assessment and acceptance of industrial products (ACAA). In October 2022, Ukraine became part of the EU common transit system.
For Armenia, the market access to the EU deteriorated as the country graduated from the GSP+ system that provided duty-free access for industrial products and lower duties for agricultural products supplied to the EU. Now, Armenia trade with the EU is based on MFN tariff. However, Armenia and the EU have been developing cooperation within the CEPA, aiming to reduce non-tariff barriers to trade.
Azerbaijan does not face changes in market access to the EU market. However, the country benefited from business development promotion, mainly through the EU4Business initiative, which is also typical for the region. However, the initiative has not been coupled with substantial EU funding for the region’s business or attraction of FDIs. The EU is the primary source of investments for the Trio but not for other EaP countries.
The most resultative in terms of region’s integration is transport. Four EaP countries are now a part of the European Common Aviation Area agreement, with Georgia and Moldova featuring long-established participation and Armenia and Ukraine signing the deals only in late 2021. Azerbaijan is in the negotiation process. Moreover, all studied EaP countries have been participating in TEN-T projects to develop land infrastructure in the region.
Another shared integration domain is people-to-people connections, especially in education and research. The EaP countries participate in broader EU initiatives like Horizon Europe and ERASMUS+, covering both the EU member states and other third countries, and the initiatives targeting the EaP countries, like EU4Youth.
1.2. Together for accountable institutions, the rule of law and security
In matters of reliable institutions, the rule of law and the security of citizens, all the countries of the Eastern Partnership have had a different pace of reforms and achievements in recent years. At the same time, in none of the cases all the most important qualitative transformations have been implemented in each of the states – a lot still needs to be done to improve the situation in the sphere, to ensure the independence and effectiveness of the relevant institutions, as well as to increase the trust of citizens.
In addition, ensuring an adequate level of public administration, justice, fight against corruption and crime, as well as cyber protection are crucial tasks for each of the participants of the Eastern Partnership per se and for building relations with the EU. Russia’s aggression against Ukraine demonstrated to what extent the elimination of factors that erode the state’s functionality and citizens’ trust in institutions strengthens national resistance to external destructive influences. At the same time, transformations in relevant areas are always among the priorities of the EU in the list of reforms of its partners. In particular, in the case of Georgia, the Republic of Moldova and Ukraine, ensuring the independence of justice and strengthening the fight against corruption are on the list of tasks necessary to advance the countries on their path to United Europe.
In the justice domain, the most extensive reforms have been implemented in recent years in Georgia, the Republic of Moldova, and Ukraine. In particular, new institutions were created to select and evaluate the integrity of judges and prosecutors. These processes are largely related to the EU’s support for the respective changes within the framework of the Eastern Partnership. In the future, the states need to take steps to implement the adopted changes, in particular, to select specialists for the created bodies, renew the judicial corps, prevent the influence of political groups on the work of the justice system, and eliminate other technical obstacles. It is worth noting the development of the Strategy of Judicial and Legal Reforms in Armenia, the implementation of which involves significant changes in the sector and is supported by the EU. The country needs to solve many challenges in this context: fight systemic political influence on justice and corruption in the sphere and ensure the independence of pre-trial bodies. In 2019, the Presidential Decree Advancing Reforms in Judicial-Legal System was also adopted in Azerbaijan. The changes in the sector that have taken place since then were not large-scale transformations of the system but rather related to the adjustment of procedural issues of the courts.
Ukraine and, to a lesser extent, Georgia have made the most noticeable progress in the field of proper public administration in recent years. The new principles and division of competences were introduced in Ukrainian ministries, which allowed improving decision-making and strategic planning, administrative and territorial reform was completed in the country, a network of institutions providing administrative services and a system of relevant electronic services were created. Georgia is undergoing a reform to improve governance and involve citizens in decision-making, but there is still a lot of work to be done in the digitalization of services, the access to public information, and public participation in the adoption of laws. Creating an open and accountable government, along with improving administrative services for citizens, is one of the areas that the Armenian authorities have been paying the most attention to in domestic politics in recent years. However, many changes in this sense are rather seemingly successful (as in the case of the long-going administrative-territorial reform, where local self-government bodies remain severely bounded by the central government) or even regressive (as in the case of encrypting some part of public information). In recent years, significant changes have taken place in Azerbaijan in the improvement of the quality of public services to citizens and the digitization of certain state services. However, further developments are needed in fiscal management, delivery of public services and creating an environment for the private sector.
Cooperation with the EU has played a significant role in improving the system of preventing and fighting corruption in Georgia, the Republic of Moldova, Ukraine and, to a lesser extent, in Armenia. In the first three countries, in recent years, the necessary laws have been passed and relevant institutions have been established to check the assets of officials and their integrity in decision-making, monitor suspicious transactions with public funds and investigate economic crimes. Armenia has intensified such activities since 2020. However, in general, in all the considered countries, the process of implementing changes is comparatively slow: the work of institutions can be blocked by procedural inhibitions, and their activity is often dependant on the political situation. Accordingly, it cannot be said that anti-corruption bodies have gained full strength and independence in these states.
In the domain of security, the main challenge for all Eastern Partnership countries remains protection from external threats and the creation of conditions for sustainable peace. In this sense, Ukraine due to the need to resist Russian aggression is in a particularly critical situation. Georgia and the Republic of Moldova, some of which territories are controlled by Moscow, as well as Armenia and Azerbaijan, which are looking for a format to prevent hostilities between them, are also interested in creating a stable security environment. It is worth noting the efforts of the European institutions in helping all the countries of the region to overcome the relevant challenges. In the field of internal security and combating organized crime, each Eastern Partnership state has its own achievements in cooperation with the EU. The greatest progress in this matter has been achieved by Georgia and Ukraine, whose law enforcement agencies have been closely cooperating with the Europol in recent years. In the case of Azerbaijan, cooperation is primarily based on data exchange and state participation in joint mechanisms for preventing natural and man-made disasters. A significant achievement of the Eastern Partnership in Armenia can be considered the preparation of the state for the creation of the Ministry of Internal Affairs, which is supported by the EU; however, the institution is not yet operational.
In recent years, all of the Eastern Partnership countries have been active in implementing normative basis and practical mechanisms for ensuring cyber security, in particular with the assistance of the EU/Council of Europe CyberEast – Action on Cybercrime for Cyber Resilience in the Eastern Partnership region Programme and in the context of implementing the provisions of the Budapest Convention on Cybercrime. However, each country has its own priorities and challenges in this context. Today, Ukraine with the EU assistance is focusing on protecting its cyber infrastructure from Russian attacks. In Georgia, there is a certain regression of the achievements of previous years in the field due to non-systemic legal reforms and improper implementation of legislation. Azerbaijan has chosen the protection of energy infrastructure as a priority in cyber security. In the context of Russia’s aggressive behaviour towards the countries of the region, the signing of an agreement on cooperation in the field of information security between the Armenian and Russian governments in 2022 is alarming.
1.3. Together towards environmental and climate resilience
Building environmental and climate resilience remains a challenge for all countries in the EaP region. More efforts are needed to integrate the environmental and climate policies into national agendas and policy making.
Environmental pollution and climate change impacts continue to adversely affect people health and well-being. In particular, in Ukraine mortality rate caused by air pollution is extremely high, some regions start experiencing water scarcity. In Georgia air pollution is the biggest environmental concern of citizens, too.
Climate change policies in the region are driven by the Paris Agreement process. Some countries have already adopted their updated nationally determined contributions (NDCs) under the Paris Agreement. In addition, Armenia, Georgia, Ukraine developed the low-carbon development strategies. Adaptation to climate change seems to be at the early stage in most countries. There is no general decarbonization trend in the region: each country is on its own track.
The European Green Deal has impact on the region with some countries (Ukraine, Moldova, Georgia) clearly looking for a role in the implementation of this EU initiative. For Ukraine, the European Green Deal has become an important policy factor affecting its strategic planning. For example, the Ukraine’s new economy strategy includes a clear target of reaching the climate neutrality by 2060.
Biodiversity protection and waste management sectors demonstrate lack of progress in all countries. Pollution of rivers by waste is a serious challenge for Georgia and Ukraine. Protected areas share remains low in all countries with no ambition to achieve targets comparable to the EU.
Water management demonstrates significant progress in most countries. In Ukraine important changes were introduced to implement river basin management approach: river basin management plans are likely to be adopted in 2024. Moldova and Ukraine worked on a joint approach for future Dniester water management plans. Similarly, Armenia is developing its first river basin management plant for the lake Sevan.
Energy efficiency remains a key green priority of the energy policy throughout the EaP region. Covenant of Mayors is an important player encouraging cities to invest into energy efficiency and climate change mitigation. The housing sector will continue to require significant investments to show progress in reducing energy consumption.
Energy security policies in the region are not based on green elements yet. Renewable energy sources share in the final energy consumption remains low (as far as 2% in Azerbaijan) despite growth in some countries (for example, Ukraine).
1.4. Together for a resilient digital transformation
The situation in digital infrastructure sector of the Eastern Partnership region differs from country to country. Two associated countries (Georgia and Ukraine) made important steps in adopting necessary strategic/planning documents as well as legal acts for developing the sector (broadband strategy, liberalisation of the telecom market, citizens’ privacy regulations, developing telecommunications infrastructure). In this regard, Ukrainian aspirations led to developing specific actions plans providing alignment with relevant EU approaches. Meanwhile, other EaP countries didn’t demonstrate significant practical progress neither in adopting important program documents nor in the context of the cooperation with the EU, however there are cases of involving investments in developing digital infrastructure. One of the consequences of such diversity: Regional Roaming Agreement as well as Regional Spectrum Agreement among EaP countries are still not signed, despite the existing Memorandum of Understanding between European Mediterranean Regulators Group and EaPeReg.
The digital transformation efforts were enhanced by the continuous development of e-governance in almost all Eastern Partnership countries. Digitalization of public services became one of the key priorities for Armenia, Azerbaijan, Moldova, Georgia and Ukraine that resulted in establishing governmental interoperability platforms, enabling a simplified and standardised secure connectivity between public administration units, introducing solutions for border crossing, developing personal e-cabinets basing on e-governmental portals, etc. This increased the quantity of online public services and implementation of relevant mobile applications for citizens.
As improving the e-governance infrastructure requires the effective implementation of state bodies’ functions in the field of digital transformation – a number of EaP partner countries have created specialized units in their governing structure (digital ministries and departments) and developed necessary strategic plans (separate or inserted in general strategies/programs).
In parallel, the EaP countries bordering with the EU (Ukraine and Moldova) were quite successful in technical and legal aspects of trust services maturity, which allowed them to be selected for eSignature piloting projects and work on approximation to the EU legislation and standards.
At the same time the quantity of online-services still remains relatively low in total scope of public services in the most of the EaP countries. Moreover, digital divisions between the central and local authorities still exist in terms of using digital technologies and electronic management systems. These challenges and other tasks (incl. piloting Digital Transport Corridors) are expected to be resolved by using EU financial and technical assistance, such as in the form of EU4Digital project.
Digital economy and establishment of a modern innovation space are one of priority areas for all Eastern Partnership countries, which is confirmed by identification of relevant milestones in national strategic documents related to economic and informational society development. Most of the EaP countries implement a significant number of innovative acceleration programs in order to connect local start-uppers with potential investors. Banks also often play a role of technology companies that create the innovative products and services in the region.
Recent sanctions against Russian Federation, introduced because of war against Ukraine, created a mass migration of private Russian IT companies to the countries of Commonwealth of Independent States that can become a strong factor for the development of digital industries and innovation sectors in the respective EaP countries. This should be considered within the future EU-EaP cooperation in these spheres. In addition, earlier, the COVID pandemic has boosted the EaP countries’ e-commerce markets.
All mentioned issues require comprehensive development of regulatory mechanisms in the field of digital economy and ICT innovation across the EaP region because of existing parallel challenges and negative effects in different countries: the e-commerce penetration rate in most of partner countries is relatively low and far from the EU average indicator; relevant EU legislation has changed significantly during past several years that creates new time challenges in terms of alignment with EU regulatory frameworks and standards; the key constraints for developing digital economy and innovation clusters are related to the low use of e-services, especially in rural areas, due to lack of Internet access, digital education and training (broad range of e-tools are accessed only by a limited number of groups).
To resolve listed issues EU facilities should be used actively to fulfill all main obligations on harmonization with EU directives and stimulate digital innovations through developing start-up ecosystems.
Ensuring sustainability of government mechanisms through strengthening cyber resilience and cybersecurity is crucial for most of EaP partner countries. This process is challenged by correspondent cooperation of some Eastern Partners with Russian Federation, especially in the context of the Russian war against Ukraine. In terms of eliminating related emerging risks, acting projects “EU4Digital: Cybersecurity East” and “CyberEast – Action on Cybercrime for Cyber Resilience in the Eastern Partnership region” make an important effect in achieving primary goals for ensuring cyber and information security in EaP region.
During last three years, main efforts of all associated EaP countries were focused on approximation to the EU basic pillars on cybersecurity, considering the different level of advancement between the partner countries, and adopting legislative and policy frameworks compliant to the Budapest Convention on Cybercrime and related instruments. This resulted in adopting appropriate cybersecurity and informational security strategies, which is a good precondition for making important legislative steps in terms of introducing institutional, policy and legislative cybersecurity legal acts compatible with EU legislation and guidelines (EU Directive on security of network and information systems).
Rapid EU responses to cyber threats (such as investing into support of Ukraine in fighting against potential Russian cyber-attacks by EU’s Cyber Rapid Response Teams) in terms of new intense geopolitical conflicts (start of Ukrainian – Russian war in February 2022) are very important for the future security of the whole EaP region.
1.5. Together for resilient, fair and inclusive societies
During the last decade, the active position of civil society and the growth of international people-to-people contacts have been one of the key factors of quality reforms in all areas in the considered Eastern Partnership countries. However, each of the states is still far from sustainable consolidated democracy and comprehensive inclusiveness. Each of them faces challenges in this area, which in some places lead to a worsening of the situation or stagnation. In addition, over the past two years, the resilience of the societies of Armenia, Azerbaijan, Georgia, the Republic of Moldova, and Ukraine have been tested by the COVID-19 pandemic and increasing regional security turbulence.
In recent years, the situation with legal and practical conditions for the activities of civil society organizations has slowly improved in Ukraine, the Republic of Moldova and Armenia, and has also remained at a relatively high level in Georgia. In this sense, the Ukrainian third sector had the best conditions as of 2021, according to the monitoring of the European Center for Not-for-Profit Law. However, the country continued to have a problem with the authorities’ openness to cooperation with civil society at various levels. Also, an increase in cases of violence against public activists was registered for three years in a row. In the conditions of Russian aggression, CSOs, on the one hand, became an important element of the nation’s resistance, on the other hand, they lost some mechanisms for controlling the government’s actions due to martial law. The approval of the new Civil Society Roadmap was a positive signal for Armenia, but it needs effective implementation and improvement of the environment. Moldovan CSOs have strengthened their role in state processes with the change in the political environment in the country; now they are actively involved in monitoring the accession of the Republic of Moldova to the EU. However, lack of funding remains a key challenge for the country’s third sector. Having strong positions in social processes, Georgian civil society cannot fully use its potential due to the politicization of decisions in the country and the lack of a constructive position of the current government regarding cooperation. Current legislation in Azerbaijan creates difficult conditions for registering and receiving foreign support for CSOs, which weakens the capacity of the country’s third sector.
Independent media remain an influential player in the socio-political processes in Armenia, Georgia, the Republic of Moldova and Ukraine, ensuring control of the authorities and supporting reforms. However, each country has its own challenges in creating the right environment for journalists to work. According to the World Press Freedom Index, the best situation for media activities among all Eastern Partnership countries is in the Republic of Moldova. Today, the priority of the Moldovan authorities and civil society in this area is to ensure the stability of the national information space against Russian propaganda aimed at the state in the context of the Kremlin’s aggression against Ukraine. Among the considered states, Armenia has the second most free media environment. However, in order to improve the situation, the country needs to neutralize polarization (politicization) of actors, disinformation and hate speech (primarily regarding the conflict on Nagorno-Karabakh). In Georgia, despite the created legal conditions for the activity of independent outlets, the situation with media freedom has worsened over the past year. In this context, the problem for the country is the extremely polarized media environment, the authorities’ underestimation of challenges in the field, and cases of government pressure on journalists and managers. International organizations have recorded a decrease in media freedom in Ukraine in recent years. However, the main reason for this is the actions of the authorities to restrict outlets and persons who spread Russian propaganda and fakes, undermining Ukrainian statehood, especially in the context of the Russia’s invasion. At the same time, a reform has been launched in Ukraine, which should limit the influence of oligarchs on political processes in the country. In particular, it is stipulated that such actors should give up their media assets – and there are already examples of such actions. According to the World Press Freedom Index, Azerbaijan has the worst situation with freedom of media among all the listed countries (154 out of 180 countries). Joint Staff Working Document on Cooperation Implementation Report on Azerbaijan outlines that freedom of opinion and expression continues to be restricted there.
As for ensuring democracy, it is worth noting that in recent years in Armenia, Georgia, the Republic of Moldova and Ukraine, all national elections have been recognised by international observers as competitive and, in general, fair. At the same time, in the Georgian political field, the current government undermines the competitiveness, creating obstacles for some opposition assemblies, surveilling its critics and to some extent obstructing the work of the opposition media. In Azerbaijan, according to the conclusion of the Venice Commission, an unprecedented level of the President’s power has been reached. The Organization for Security and Co-operation in Europe criticized the country’s recent presidential and parliamentary elections for a lack of competitiveness and transparency, respectively. The establishment of gender quotas in the last parliamentary and local elections in Georgia and in the last parliamentary elections in Ukraine should be admitted as positive trends. Ukrainian voters also got the opportunity to elect candidates from open lists – but this option is still available in local council elections, the implementation of this rule for the parliamentary elections was postponed by legislators.
In the field of ensuring human rights, the countries of the Eastern Partnership have a legal framework that nominally guarantees compliance with international standards and norms. However, the practical implementation of these principles remains far from the optimal level on many issues, primarily in guaranteeing gender equality and combating discrimination. Thus, in each of the considered countries of the Eastern Partnership, discrimination and gender-biased practices against women remain in place to varying degrees in economic and everyday life, and there are also problems with an adequate level of their participation in political life and holding positions in government structures. Also, the protection of women from violence/domestic violence remains a problematic issue. In this context, the ratification of the Istanbul Convention by Georgia, the Republic of Moldova, and Ukraine has been a positive step in recent years. Authorities and society in Armenia have not yet reached a consensus on the ratification of the document, although the state has signed it. In addition, in the countries hate speech and even demonstrative discriminatory actions against representatives of the LGBTQ+ community and advocators of their rights are still widespread. As an example, the clashes on the streets of Tbilisi last year before the planned Pride could be mentioned.
In terms of mobility, it is worth noting that Georgia, the Republic of Moldova and Ukraine have fulfilled the key visa liberalization benchmarks, which allows countries to maintain a visa-free regime with the EU. At the same time, the European Commission in 2021 addressed tasks to each of these states to continue effective cooperation in this regard and maintain the current level of mobility. Thus, Georgia still needs to address the issue of the increased number of asylum seekers in the EU and continue information campaigns on the rights and obligations of the visa liberalization process. In case of the Republic of Moldova, the European Commission highlighted the necessity to adopt a strategy and action plans for justice reforms, including constitutional amendments in line with the Venice Commission’s recommendations, effective implementation of the asset declaration system by high-level actors and fight against irregular migration towards the Schengen zone. For Ukraine, the main tasks in this regard are fully aligning the visa policy of Ukraine with the list of third countries whose nationals were subject to a visa for short stays in the EU, improving the efficiency of anti-corruption institutions and carrying out a transparent, depoliticised and merit-based selection of the heads of the respectful services. The EU notes the overall good implementation of the Visa Facilitation and of the Readmission agreements with RA and willingness of Armenia to start a dialogue with the EU.