Differences in the institutional framework that govern the relationship between the EaP coun­tries and the EU continue to influence the depth and intensity of political dialogue. In this regard, Ukraine has many advantages over the other EaP partners as it is the only country that holds an annual summit and has seven cooperation sub-committees. Although the annual EU-Ukraine summit did not take place in 2012 due to a number of political factors, being postponed to February 2013, Ukraine keeps its leading position concerning activities of bilateral institutions. In contrast, Belarus is the only EaP country that has no contractual framework with the EU, i.e. no Partnership and Cooperation Agreement (PCA) and, although it is a part of the Eastern Partner­ship Initiative, its bilateral relationship with the EU is frozen.
 
In 2012, Georgia, Ukraine and Moldova main­tained their leading positions relating to the density of high-level bilateral visits, while Azer­baijan and Belarus lag behind. For the first time, Armenia joined the frontrunners, thus suggesting an increasing interest of the EU in strengthening relations with Armenia and encouraging further domestic reforms.
 
Interestingly, Ukraine, Georgia and Belarus were the subject of the most statements released by the European External Action Service (EEAS), apparently due to the fact that all three countries had parliamentary elections in autumn 2012.
 
At the same time, political parties from all EaP countries have established cooperation with European political party families. It is notewor­thy that both ruling and opposition parties have established links with European party families. Three of the six heads of state and govern­ment — in Armenia, Georgia and Moldova — are affiliated with the European People’s Party. Remarkably, all three parties in the Moldovan governing coalition are associated with the three main European party families: People’s Party, the Socialists and the Liberals. The number of parties that are members of or observers in parties at the European level varies from five in Moldova to two in Azerbaijan.
 
As far as multilateral cooperation is concerned, all countries constantly participate in the work of the Eastern Partnership institutions. In contrast to the bilateral track, Belarus is fully involved in the multilateral dialogue within the EaP institu­tions, except for Euronest. The participation of Belarus in Euronest was indefinitely postponed for political reasons.
 
EU cooperation on human rights has various formats and is of varying intensity with indi­vidual EaP countries. Moldova, Georgia, Armenia and Belarus established dedicated human rights dialogues with the EU. However, the EU-Belarus dialogue took place only once, in 2009, and since then has been suspended. Moldova has two dedi­cated meetings with EU officials a year, whereas Georgia and Armenia one meeting a year. Ukraine and Azerbaijan refused to launch dedicated human rights dialogues. The EU is able to raise human rights concerns with these two countries only within the Justice, Freedom and Security (JFS) sub-committee.
 
Ukraine has preserved its leading position in cooperation in the Common Foreign and Security Policy (CFSP) and Common Security and Defence Policy (CSDP). Ukraine is the only EaP country that cooperates with both the EU Military Com­mittee and the EU Political and Security Commit­tee. At the same time, Moldova demonstrated a closer alignment with the EU foreign policy by subscribing to most of the EU CFSP statements and by signing the Framework Agreement on par­ticipation in EU crisis management operations. Ukraine is still the only EaP country that partici­pates in EU military missions. In 2012 Moldova and Georgia received a positive reaction from the EU regarding their potential participation in the EU EUCAP Nestor mission. At the same time, all EaP countries, except for Belarus, show an interest in strengthening security cooperation with the EU, by participating in different CSDP consultations and trainings.

Economic Cooperation: Trade in Goods, Services and FDI

As the largest regional market, the EU has been an important trading partner for all EaP coun­tries. In 2012 the EU-27 remained the leading trading partner in both the export and import of goods for four EaP countries: Armenia, Azer­baijan, Georgia and Moldova. For Belarus and Ukraine, the EU remained the second largest trading partner after the Russian Federation.

On average, goods turnover with the EU con­stitutes around one third of total EaP turnover. Countries’ figures vary between 27% and 45%, with the highest EU goods trade observed in Mol­dova and Azerbaijan—the latter due to energy exports— and the lowest in Belarus and Georgia.

Three EaP countries, namely Armenia, Moldova and Belarus, increased their exports to the EU in nominal terms, while exports of three other EaP countries dropped. All EaP countries increased the import of goods from the EU.

The importance of the EU in services trade is less homogeneous across EaP countries. Services trade turnover with the EU is estimated between 13% and 22% of total service trade of each coun­try for the four smaller EaP countries (Armenia, Azerbaijan, Georgia and Moldova). The respective shares for the two larger countries — Belarus and Ukraine — constitute 51% and 36%.

While the EU occupies a leading position in exports and imports in the EaP countries, these countries represent only a small percent in the EU overall trade. Altogether, the six countries of the region account for around only 2% of EU goods trade and a marginal 0.4% of EU services trade. As a comparison, the Southern neighbours represent 5% of the EU’s trade and Russia 10 %. Ukraine has been the EU’s largest trading partner among the EaP countries. It accounts for 52% of overall trade between the EaP region and the The actual level of tariff protection faced by the EaP countries in the EU is determined by the Import Tariff Schedule of the EU, eligibility to existing preferential schemes (GSP^[1] , GSP+^[2] , ATPs) and bilateral agreements, as well as the commod­ity structure of each country.

Among the EaP countries Belarus exporters face the highest level of tariff protection in the EU, followed by Ukraine and Moldova’s exporters face the lowest level of tariff protection. EU exporters have to deal with the highest tariffs in Belarus (reciprocity principle) and in Azerbaijan. The lowest import tariffs on EU products are applied in Georgia. Both the EU and EaP countries tend to have higher average tariffs on agricultural products than on industrial goods.

Three EaP countries, Azerbaijan, Belarus and Ukraine, apply export tariffs that also affect exports to the EU. The list of products subject to export tariffs includes metals and scrap metal from Azerbaijan and Ukraine, mineral products from Belarus and Ukraine, and selected other sensitive raw products like oil seeds and skins from Ukraine and wood from Belarus. The EU does not apply export tariffs. The establishment of the DFCTA between Ukraine and the EU will result in the eventual elimination of Ukraine’s export tariffs in trade with the EU, although the agreement envisages long transition periods and temporary trade remedy measures allowing for the existing level of protection to be kept during the transition period.

Trade defence measures have been rarely used in trade between the EU and the EaP countries. In 2012, the EU did not launch any new anti-dumping or safeguard investigations that concern products from the EaP countries. Among the EaP countries in 2012 only Belarus launched new investigations that concern EU products.

Ukraine accounts for the majority of currently registered cases. In the EU, measures applied towards Ukraine’s products were adopted more than five years ago, that is, before Ukraine be­came a member of the WTO, and the number of applied measures gradually reduced in 2011-2012.

Measures applied in Ukraine towards goods produced in the EU are quite recent. Two anti-dumping measures were enacted in 2009 and 2012 and two safeguard measures in 2011 and 2013. In particular, in April 2013 Ukraine introduced safeguard measures on the import of motor cars. The decision has caused serious concerns among WTO members, in particular the EU, regarding its compatibility with the provi­sions of the WTO Safeguards Agreement. The list of raised issues includes whether there was adequate consultation opportunities before the adoption of the decision, causality issues and is­sues relating to the maintenance of substantially equivalent levels of concession. The Government of Ukraine has expressed its readiness to con­tinue consultations with the WTO.

^[1] The GSP is an autonomous trade arrangement through which the EU provides non-reciprocal preferential access to the EU market. The system allows exporters from developing countries to pay lower duties on some or all of what they sell to the EU. It envisages duty-free access for non-sensitive products and a reduction in import duties for sensitive products. www.ec.europa.eu

Freedom, Security and Justice
 

Freedom, Security and Justice (FSJ) remains a key area of cooperation between the EU and EaP countries. The EU pursues the creation of an area of security and prosperity at its Eastern border, while the EaP governments declare their commit­ment to fighting against corruption, organised crime, illegal migration, human trafficking and promoting efficient law-enforcement and human rights.

The catalyst for efficient cooperation in FSJ matters is the EU’s promise to all EaP countries of at some point visa-free travel to the EU under certain conditions. This visa policy became one of the most effective foreign policy tools used by the EU to encourage reforms in the EaP countries. The prospect of visa-free travel is appealing to both the political elite and ordinary citizens. For most EaP countries’ governing elites this pros­pect became a more powerful incentive than that of full EU membership, as politicians are willing to deliver results while still in office in order to in­crease their chances to hold on to power. Whilst the prospect of membership remains a long way off and impacts minimally on ordinary people in the short term, visa-free travel would benefit all citizens, thus increasing support for the incum­bent government.

The EaP Index measures the level of cooperation of each EaP country with the EU on FSJ mat­ters and implementation of domestic reforms required by the EU, mostly included in the Action Plans on Visa Liberalisation (APVL).

The 2013 Index confirms Moldova’s leading posi­tion in implementing required reforms. Ukraine is lagging behind Moldova and the gap between Chisinau and Kyiv is increasing both institution­ally and technically. Moldova moved to the sec­ond phase of APVL in 2012, which is largely well implemented, while Ukraine is still in the first phase. Kyiv still needs to adopt and implement a comprehensive anti-discrimination law in line with European standards and establish an inde­pendent anti-corruption agency. Georgia is slowly catching up with Moldova and technically has almost reached Ukraine’s level. The country was handed an APVL in February 2013 and started implementing many of the prescribed reforms even prior to this event, especially on combating corruption.

Armenia has not yet received an APVL. Despite this fact, Armenia started a series of reforms aimed at aligning its legislation with EU stan­ dards and showed progress in 2012. Belarus and Azerbaijan are far from receiving an APVL, since, unlike the other four EaP countries, they have not even concluded visa facilitation agreements with the EU. The latter facilitates the process of issuing Schengen visas to certain categories of EaP citizens by EU member states’ consulates. One particular impediment to greater progress in Azerbaijan and Belarus is the worsening human rights situation and limited cooperation with the EU in some of the FSJ areas. Belarus continues to register the lowest results among the EaP countries. One has to note, though, that Belarus receives the highest number of both EU and Schengen visas per capita among the EaP coun­tries. This probably has to do with the informal policy pursued by EU member states’ consulates of facilitating greater mobility for Belarus citizens as a counterbalance against the authoritarian regime.

Four countries – Ukraine, Moldova, Georgia and Armenia – have visa facilitation and readmission agreements with the EU, while Azerbaijan is ex­pected to sign them in November 2013. Moldova and Ukraine signed the second generation of visa facilitation agreements, which further eases visa requirements and broadens the list of categories of citizens eligible for visa facilitation.

All countries of the region are relatively advanced in ensuring document security, except for the fact that not all states issue biometric passports. Ukraine has a legal framework for biometric passports, but lacks the necessary secondary legislation, which prevents issuance of the new documents. Belarus started to issue biometric passports as a pilot project. However, it is not clear to what extent these are in accordance with the International Civil Aviation Organization standards. While the remaining countries issue biometric passports, not all of them have plans in place to phase-out the old travel documents.

Most EaP countries have good standards in the area of irregular migration. Some shortcomings are observed in Georgia, where there is no compe­tent civilian authority dealing with migration and Azerbaijan which does not have a framework document on migration. Compared to previous years, the EaP countries progressed in most areas related to migration, integrated border manage­ment and asylum. Belarus and Armenia still score low on border management both in Linkage and Approximation.

Public security and order represents one of the most difficult areas to reform. Countries show good progress in terms of adoption of legisla­tion, which is a part of Approximation, while the Linkage dimension scores remain low for most countries. The implementation of recently adopted laws remains a challenge. Only Georgia shows a high level of controlling corruption in our Index, based on indicators from Transparency International and the World Bank, leaving other countries behind with Ukraine and Azerbaijan showing the worst results.

The reforms in the area of external relations and human rights are difficult to implement for most of the countries. Moldova was the only country to adopt an anti-discrimination law in line with basic standards of the EU in 2012. The rest of the countries have no specific or general legislation in place and as such no effective mechanism for protection against discrimination, in particular for sexual minorities.

The Linkage and Approximation dimensions of FSJ show no major discrepancies. In most cases developed links with the EU in this area trans­late into a better domestic reform process. Yet, one could highlight that Georgia, Armenia and Azerbaijan seem to exert more efforts where domestic reforms are concerned than Ukraine. For instance, Georgia shows almost the same level of approximation as Ukraine, although its links with the EU are far less developed. Armenia and Azerbaijan, although disadvantaged in terms of links with the EU, are also catching up with domestic reforms. Thus, although most countries adopted impor­tant new legislation in 2012, the hard work remains to be done in 2013 and 2014 when most of the legislation will have to be implemented in a comprehensive and sustainable manner. To make this happen the authorities and societies of the EaP countries will have to put in signifi­cant efforts and resources. This will pave the way for visa-free travel to the EU, but first of all to a modern justice and security system based on European standards that could offer more rights and opportunities to citizens.

Energy
 

Trade-related and other economic factors matter more for EaP countries’ Linkage with the EU in the field of energy than participation in multilat­eral dialogue mechanisms initiated or supported by the EU. In this regard Armenia is a very minor player with little trade between the EU and Arme­nia. Azerbaijan, Georgia and Belarus are mainly exporting fuels and minerals to the EU. Ukraine and Moldova are increasingly importing energy from the EU. The engagement with Azerbaijan is set to grow as it will become the main supplier in the future Southern Gas Corridor, while Georgia and Ukraine will remain key transit countries.

The EaP countries are slowly yet confidently transforming their energy sectors in accordance with EU regulations. The success of such change largely depends on the systematic nature of approach of the country. For instance, Belarus distances itself from any cooperation on energy and demonstrates a poor performance in energy reforms. Both Azerbaijan and Armenia made significant steps in gas and electricity market restructuring. Azerbaijan signed a Memorandum of Understanding on energy sector cooperation with the EU and Armenia gained observer status in the Energy Community. Armenia and partly Moldova implemented ownership unbundling rules. Armenia also established an independent regulator, similar to Georgia and Moldova. Georgia, who applied for membership to the Energy Community, is still way behind Ukraine and Moldova who are already full members. Yet, Georgia offers free access to infrastructure and has better energy efficiency indicators than any EaP country. At the same time Kyiv and Chisinau have the highest level of formal commitments but show moderate progress in implementation of the acquis communautaire. The Ukrainian energy market is being liberalised in both gas and electricity sectors, while the Moldovan market is more open and non-discriminatory. Both coun­tries developed renewable energy national targets and greenhouse emissions reduction mechanisms. However, none of the EaP countries started to implement the far-reaching reforms within the Third Energy Package.

In comparison to the period assessed in the previ­ous Index energy consumption of EaP countries changed slightly. Belarus, Moldova and Georgia were most successful in reducing energy inten­sity and greenhous gas (GHG) emissions, while Ukraine and Armenia showed almost no progress.

In order to produce sustainable results in reform­ing the energy sector the EU should increase its technical and expert support. Regulatory approxi­mation should be followed by effective enforce­ment of the new rules. Approximation should also address the structure of the energy markets by optimising the energy mix and developing infra­structure, including cross-border connections. Only such a holistic approach can provide better energy security for both the EU and partner countries.

Transport

Transport plays an important role in the facilita­tion of economic cooperation, trade and people-to-people contacts. However, the development of transport infrastructure lacked appropriate attention from the EU in recent years most prob­ably due to the financial troubles of the euro zone.

Some improvement in transport policies and infrastructure in the EaP countries was registered mainly due to initiatives launched in the late 2000s or to substantial domestic support.

The Linkage dimension reflects the lack of rela­tively recent integration initiatives in the field of transport. For instance, in the aviation sector one of the EU’s priorities is the enlargement of the Common Aviation Area (CAA). Georgia and Mol­dova already signed agreements on CAA, but their ratification on the side of the EU is pending. The progress of Azerbaijan and particularly Ukraine, who started talks in 2007, is considerably slower. Belarus and Armenia have not started negotia­tions on joining the CAA, although Armenia started approximation with the EU aviation safety legislation. Some progress was achieved in strengthening administrative capacities of transport bodies mainly due to joint projects with the EU launched some years ago. In particular, independent or quasi-independent transport incident investigating bodies were finally created to correspond to the EU’s safety requirements.

The Approximation dimension illustrates a somewhat different trend. Mostly driven by the scarcity of financial means to invest in transport infrastructure, EaP countries initiated reforms in the transport sector. These have been aimed at reducing the state’s power in transportation and at attracting private investments. Following this model, Ukraine adopted relatively liberal legisla­tion regulating ports and railway freight. Moldo­va also started reforming its railways and allowed concessions of airports. Armenia and Georgia have liberalised almost all transport markets.

The EU’s relatively decelerating involvement in the field of transport has resulted in lack of progress in safety aspects and in ongoing EaP countries’ reluctance to establish independent transport regulatory bodies. In particular, the number of road accidents remains substantial and their rate did not change across the countries compared to the Index 2012. Also, the Index 2013 shows no considerable improvements in transport regulation.

In previous years Ukraine was the leader in the field of transport, but recently Moldova and the Caucasus countries, in particular Georgia, caught up. Armenia, Azerbaijan and Georgia have increased the quality of transport services and ensured greater participation of private compa­nies in their provision. Meanwhile, Ukraine and Belarus having a closer geographical position to the EU lag far behind in transport development. Namely, Belarus has not adjusted to the EU’s standards and policies despite having the largest share of land connections to the EU among the EaP countries.

This part of the Index looks at the mobility of citi­zens, including students, at educational policies, focusing on the Bologna process, and at policies on education, culture, youth and information society.
 
Moldova is the best at using the opportunities for mobility to the EU and ranks highest in people-to-people contacts. Ukraine follows second, while Georgia and Armenia stay closely behind in third and fourth position.
 
In 2012 the EU countries issued the highest number of Schengen visas, about 1.3 million, to Ukraine. The number of Ukrainians travelling to the EU has increased in the last year, as a result of the facilitated visa regime. Although the EU does not have a visa facilitation agreement with Belarus, Belarusians are the most frequent travel­lers to the EU. Every 13th Belarusian received a Schengen visa last year and travelled at least once to the EU. At the opposite end of the scale, Ar­menia has the lowest number of Schengen visas issued and only 1 for every 715 Armenians had a visa to travel to the EU last year.
 
According to the migrant stock data for 2012 almost 8% of Moldovan citizens are residing legally in EU countries. Belarus is next with 3% of its population having moved to the EU. Ukraine has the biggest diaspora in the EU with more than 1 million of its citizens, or 2.35% of the entire population, living in the EU. Azeris are the least attracted to move to the EU, with less than 35,000 choosing this path.
 
Participation in EU programmes and agencies is open to all EaP countries that have Partnership and Cooperation Agreements (PCA) with the EU. However, despite Belarus not having a PCA, the EU opened several programmes for Belarus’ participation as well. Eligibility for participation in selected programmes and agencies is defined by the European Commission according to the needs of each country and is provided for in bi­lateral protocols. PCA Protocols were signed with Ukraine, Moldova and Armenia. Azerbaijan and Georgia are still negotiating their protocols. All six EaP countries participate in the 7th Frame­work Programme for Research and Technological Development (FP7).
 
Georgia is the most active participant in EU pro­grammes and agencies among the EaP countries. Armenia, Ukraine and Moldova follow next more or less at the same level. Azerbaijan and Belarus are the most reluctant participants.
 
Georgia hosted the highest number of youth proj­ects, 36, in 2012, compared to only one project each in Belarus and Azerbaijan. Armenia has the highest number of participants in youth exchang­es per capita, while Ukraine the lowest. Georgia also hosted the most EU volunteers per capita, while Armenia sent the most volunteers to the EU. Armenian students are the best at taking ad­vantage of the EU funded scholarship programme Erasmus Mundus, while Azeri students are the least keen.
 
Although Ukraine has the highest number of uni­versities involved in EU funded Tempus projects, compared to the total number of universities, the country ranks the lowest in this category. Armenian, Georgian and Moldovan universities participate more often in Tempus projects. All six countries had a similar level of involvement, 10-11 projects per country, in bilateral and multilateral projects of the European Training Foundation.
 
When it comes to the Bologna process and general education reforms, Georgia is the best performer. The country managed to undertake se­rious reforms back in the early 2000s and the cur­rent situation in many ways reflects that change. Belarus is lagging behind on the majority of education indicators. This is due to the fact that education in Belarus is totally subordinated to the government, while reforms are mostly formal. Other countries, notably Ukraine, Moldova, Ar­menia and Azerbaijan, have so far preserved the soviet legacy of the government trying to control universities and at the same time are implement­ing Bologna principles. Moldova still debates the new Code on Education, which, once adopted, will bring together all the legal provisions on educa­ tion and replace the outdated law on education from 1995. In Ukraine the three-cycle system is rather a formality, since it coexists with the old two-cycle system and limits the potential for the mobility of students. The situation is similar in Armenia where MA programmes exist rather as a variation of the old specialist programme.
 
The situation regarding the autonomy of uni­versities with respect to academic, institutional, personnel and financial components shows that the government controls universities in many respects, denies them the right to issue diplomas and grant qualifications and allows only limited institutional and academic freedoms. Ukraine is the only EaP country that lacks modern legisla­tion on education. A new bill on Higher Educa­tion is currently being debated. At the same time, Ukraine is doing better in terms of the National Qualifications Framework. In April 2012 the Ministry of Education and Sciences of Ukraine approved the implementation plan for the Na­tional Qualification Framework for 2012-2015. In November 2012 a similar Regulation on Educa­tional Qualification was adopted in Armenia.
 
No EaP partner has made progress in providing better opportunities for foreign, including EU, students to study in the EaP countries. The ma­jority of foreign students still come from neigh­bouring post-soviet countries and Central Asia.
 
All EaP countries have similar scores assessing policies in culture, youth, information society, media and audio-visual use. More specifically, Ukraine, Moldova and Armenia are the most progressive in cultural policy, although Ukraine initiated reforms and monitoring through the Cultural Policy Review later than other EaP countries.
 
The youth policy scores take into account the existence of legislation, national youth reports and legal provisions for volunteering and youth work. All EaP countries are making progress in developing new strategies and laws, e.g. on volunteering. There are strong debates on the provision of youth work and informal education in Armenia. Until 2009, there were only frag­mentary provisions for youth policy in Georgia when the development of a National Youth Policy started. The new law was adopted and came into force in 2012.
 
Georgia adopted its legislation on cultural policy relatively recently and opened the debate on improving the youth policy. Moldova still has no comprehensive youth report — only numerous fragmented studies on youth. There has been progress though in preparing a new law on youth. Moldova and Ukraine adopted laws on volun­teering. Civil society in Belarus has advocated a number of amendments to the law on volunteer­ing, yet the authorities have so far been reluctant to improve the legislation. 

Among the EaP countries, Moldova and Georgia are the main beneficiaries of and the most reliant on EU assistance. According to the latest available data funding from the EU and its member states to Moldova and Georgia accounts for about 3.8% and 2.5% of their GDP. Armenia took over the third position from Ukraine in the overall ranking of EU assistance. Belarus and Azerbaijan benefit very little from EU assistance. While the relatively low result of Ukraine is mainly determined by its large population size and high GDP, in the case of Azerbaijan and Belarus the low scores are a reflection of the EU’s ‘less for less’ approach according to which the EU offers little assistance to countries with little democracy.

The European Neighbourhood and Partnership Instrument (ENPI) is the EU’s main assistance instrument in relation to the EaP countries. In 2007-2010 the EU committed around EUR 1 billion to the EaP countries; this amount increased to over EUR 1.2 billion in 2011-2013. Ukraine is the largest beneficiary of the ENPI among the EaP countries receiving around EUR 470 million in 2011-2013. Yet, when ENPI assistance is calculated per capita, Ukraine is on the same level as Azerbaijan and Belarus, with only EUR 3.3 per capita allocated from the EU in 2012. In contrast, the EU allocation per capita to smaller countries is much higher: EUR 35 in Moldova, EUR 24 in Armenia and EUR 19 in Georgia per year.

In 2012, for the first time, the EU distributed funding from the Eastern Partnership Integration and Cooperation (EaPIC) programme. The new instrument worth EUR 130 million for 2012-2013 provides additional funding to EaP countries according to the principle of ‘more for more’ – the more a country progresses in its internal reforms for democracy, respect of human rights and the rule of law, the more support it can expect from the programme. According to EU assessment and supported by the findings of last year’s Index, three countries made good progress on deep and sustainable democracy last year and received additional financial support: Moldova (EUR 28 million), Georgia (EUR 22 million) and Armenia (EUR 15 million). Unfortunately the EU has done very little to publicise and to explain to the people in Ukraine, Azerbaijan and Belarus why their governments were not entitled to increased funding.

Moldova and Armenia were the only countries to continue benefitting from macro-economic assistance from the EU in 2012. While Moldova received a grant of EUR 30 million, Armenia received EUR 39 million as a loan from the EU. In February 2013 the EU committed EUR 610 million in macro-economic financial assistance to Ukraine. However, so far no funds have been disbursed as Ukraine did not meet the IMF requirements.

As a measure of linkage between the EU and EaP countries in terms of transfer of experiences, know-how and contacts between civil servants, the Index looks at the number of TAIEX and Twinning projects. TAIEX provides targeted policy and legal advice, usually by sending EU experts to help a ministry or local government in a partner country with a specific reform task or to provide short term training. The countries most eager to receive EU advice are Moldova (113 requests), Ukraine (100 requests) and Belarus (58 requests). Moldova and Ukraine hosted the largest number of TAIEX events in 2012, 39 and 37 accordingly. Surprisingly, Azerbaijan and Belarus hosted more TAIEX events than Georgia and Armenia. Ukraine and Belarus lead on the number of officials participating in TAIEX trainings.
Twinning projects are longer term peer-to-peer projects between public administrations of EU member states and EaP countries. Ukraine and Azerbaijan initiated three new twinning projects each in 2012. Georgia added two new projects and Moldova one. Additionally Armenia and Moldova host high-level EU advisors who help individual ministers and high ranking officials with sectoral reforms. In 2012 the EU delegated 15 high-level advisors to Moldova and 13 to Armenia.

All six EAP countries are entitled to funding within the Comprehensive Institution Building (CIB) initiative designed to strengthen the capacities of key institutions involved in preparing, negotiating and implementing the new Association Agreements with the EU. The EU support for CIB in 2012 varied from EUR 17 million for Moldova to EUR 7 million for Azerbaijan. Belarus is the only EaP country that did not receive CIB funds. Three countries — Ukraine, Moldova and Azerbaijan — received EU funds for regional and rural development in 2012.

All EaP countries, except Azerbaijan, are involved in ENPI East regional and interregional projects. Ukraine, Moldova and Belarus are the most active participants in cross-border projects taking advantage of their geographical proximity and shared land borders with EU member states.

In 2012 the Neighbourhood Investment Facility (NIF) contributed EUR 69.2 million to three regional and seven national projects in Eastern Europe. Armenia received the greatest funding from NIF, EUR 17 million, for two new infrastructure projects. Georgia is the second biggest beneficiary with EUR 12 million for two new projects. Belarus and Ukraine did not receive any new grants from NIF in 2012.
EU support to civil society in Eastern Europe increased considerably in 2012. EU funds to civil society organisations (CSOs) flow through the European Instrument for Democracy and Human Rights (EIDHR), the thematic programme Non-State Actors and Local Authorities (NSA&LA) and the Eastern Partnership Civil Society Facility (CSF). The CSF is the newest of the instruments and has a budget of EUR 23.3 million for 2012-2013. The CSF aims at strengthening civil society to become an agent of change and democratisation in the EaP countries. In 2012 the CSF focused on strengthening civil society’s networking capacity and improving their abilities to promote national reform and increase public accountability. Overall, the EU distributed more funding to CSOs in countries that are lagging behind in adopting EU standards or are notorious for restricting CSOs activities. Thus, in 2012 the EU provided EUR 5.5 million to Belarusian CSOs, EUR 5.2 million to Azeri CSOs, EUR 4 million to Ukrainian CSOs and only EUR 1.5 million to Moldovan CSOs. Moldova is the only country that did not receive any country allocation from the CSF, while Azerbaijan received the highest amount of EUR 3.6 million.
The Index also looks at cooperation between the EaP countries and European financial institutions — the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD). While all EaP countries have recently benefitted from loans offered by the EBRD, the EIB funded projects only in Ukraine, Moldova, Georgia and Armenia. Ukraine is the biggest beneficiary of loans from these institutions with accumulative figure of around EUR 1.6 billion for 39 projects. However, comparatively in terms of level of loans to GDP and population, smaller countries – Georgia, Moldova and Armenia – are leading in terms of benefits from the European financial institutions.

The Index devotes special attention to Deep and Sustainable Democracy – a concept which helps the EU to apply the ‘more for more’ approach. It looks at elections, media freedom, association and assembly rights, human rights, independent judiciary, quality of public administration, fighting corruption, accountability and democratic control over security and law enforcement institutions. The Index shows which of the countries improved in these areas and thus deserve additional rewards from the EU and which of the countries regressed and might require a special warning.

In the 2013 Index Moldova is again the best performer in Deep and Sustainable Democracy. The difference between Moldova and Georgia, who comes second, is relatively large. Ukraine and Armenia share similar scores in third and fourth position. Azerbaijan and Belarus are closing the gap between their positions, but both lag significantly behind the four frontrunners.

Most importantly, Moldova, Georgia and Armenia have improved their democracy performance in the current Index, which implies that these countries should be offered additional funding from the Eastern Partnership Integration and Cooperation (EaPIC) instrument, as happened last year. Ukraine stays on the same level as in the 2012 Index. Belarus has slightly improved its scores, while the situation in Azerbaijan slightly deteriorated.
More specifically, Moldova shows deterioration in Elections after the uncompetitive election of the President by the parliament. At the same time the country improved its performance in all other aspects of democracy and human rights. Moldova was the first country in the region to adopt a comprehensive anti-discrimination law in 2012.

Georgia took over second place from Ukraine. Georgia improved its score after the elections in autumn 2012 and shows significant progress in Independence of Judiciary and Fighting Corruption.
Ukraine slipped down the rankings from second place and moved very close to Armenia in third and fourth place respectively. Ukraine’s score in Elections deteriorated, following the negative assessment of its parliamentary elections by international and domestic observers. Instead the country improved the situation of human rights by adopting free legal aid and setting up a national torture preventive mechanism. Ukraine also adopted a non-discrimination framework law, which, however, failed to comply with EU standards.

Armenia shows improvement in Elections; Media Freedom, Association and Assembly Rights; and Independent Judiciary, with little changes in other aspects of democracy.

No positive changes were registered in Azerbaijan over the last year. As Belarus improved its score in fighting corruption, the ranking gap between the two countries is closing in relation to the quality of democracy and human rights.

Elections

The 2012 parliamentary elections held in Armenia, Georgia, Belarus and Ukraine did slightly affect the scores on the quality of elections. While the situation in Belarus did not change, the situation in Georgia and Armenia improved and that in Ukraine deteriorated. Notwithstanding, an increasing number of shortcomings in the electoral process was still registered in all four countries.

Overall, none of the EaP countries meet the standards of democratic elections set by the Index. Moldova remains far ahead of the other EaP countries in organizing and conducting free, fair and competitive elections, followed by Georgia, Ukraine and Armenia. The biggest problems in ensuring a fair electoral competition and the transparency of the electoral process were again registered in Azerbaijan and Belarus.

The 2013 Index recorded progress in Georgia and Armenia and decline in Ukraine and Moldova in Elections. Armenia’s progress is explained by better and more equal access to media for all candidates, mainly during the parliamentary elections in May 2012 compared to earlier elections, better implementation of the legal framework and increased electoral competitiveness. Both international and local observers and the national regulatory body registered progress in balanced and equal media coverage. The positive change was due not only to adequate mechanisms to ensure balanced and equal media coverage, but also due to the political will to provide such guarantees.

In Georgia the implementation of electoral legislation slightly improved, as well as the overall legitimacy of elections. Independent candidates had better opportunities to register as a result of amendments introduced to the Electoral Code in 2011. Moreover, electoral competitiveness increased significantly, as the difference between the share of the votes in the parliament held by the strongest party (The Georgian Dream of Ivanishvili) and the main oppositional party (United National Movement of Saakashvili) diminished.

Ukraine, on the contrary, experienced considerable decline compared to the last year’s Index, mainly because of the unlevel playing field and deficient implementation of new electoral legislation. Moreover, many problems with vote counting were registered. Overall both domestic and international observers reported a number of serious problems with legal provisions and how the elections were conducted.
The Moldovan parliament elected a new President in March 2012 after a more than two year stalemate. To avoid further obstruction by the opposition the law was changed to allow the election of a president even if only one candidate is registered. The opposition still boycotted the election, but the ruling coalition managed to garner enough votes for their candidate. This situation undermines competitiveness in electing the President, which resulted in a lower score for Moldova in the 2013 Index compared to the previous year.

The negative assessment of elections in Belarus in 2013 did not change its already low position compared to the previous Index, while in Azerbaijan the elections are not until October 2013.
Apart from the dynamics highlighted above, most countries in the region still have serious problems with elections. The quality of the election process in Georgia, Armenia and Ukraine is comparable and the pattern of deficiencies also does not differ much. The key problems that undermine the fairness of elections in these countries are unclear criteria for the delineation of electoral districts, use of administrative resources by the ruling parties, selective implementation of the election legislation and an inefficient system for complaints and appeals. Lack of adequate mechanisms to ensure a balanced and equal media coverage is another problem. Although, it should be noted that the situation considerably improved in Armenia, where 2012 saw unprecedented plurality in media coverage of the elections. The National Committee for TV and Radio monitored extensively what was broadcasted to ensure a balanced and equal media coverage.

None of the EaP countries has an effective system preventing vote-buying, although all of them have legislation prohibiting this action. Georgia is the only state that provides both direct and indirect public funding for political parties. Ukraine, Moldova, Belarus and Armenia provide only indirect public funding and its extent varies depending on the country.

As far as electoral competitiveness is concerned, Ukraine and Moldova maintained their leading positions, although the difference between the share of the vote held by the strongest party and the strongest oppositional party increased in the case of Ukraine. In Georgia and Armenia competitiveness between parties also increased, as the difference between the number of seats held by the leading party and the main opposition party decreased in the 2012 elections. Nevertheless, one should note that the ruling party in Armenia in 2012 received more seats than in the previous election in 2008, while the second biggest party in terms of number of seats cannot be considered truly oppositional.

 

Media freedom, association and assembly rights

The countries’ scores in this part of the Index mostly rely on the assessments of independent international institutions such as Freedom House, Bertelsmann Transformation Index and Reporters without Borders.
The situation of media freedom is uneven. Moldova remains the best performer, although according to Reporters without Borders the media situation in the country deteriorated. Georgia comes second. Both Freedom House and Reporters without Borders highlight improvements in Georgia. Armenia comes third. While Freedom House praises Armenia’s progress, Reporters without Borders point to certain deterioration. Local experts in Armenia state that the situation rather improved, mostly due to unprecedented plurality in the media coverage of elections and essential improvements in court practice on defamation. Ukraine follows Armenia. Here while Freedom House shows deterioration, Reporters without Borders point to certain improvements. Azerbaijan and Belarus continue to pay the least respect to this aspect of democracy, although Reporters without Borders highlight certain improvements in both countries.

Where association and assembly rights are concerned, we see a somewhat different pattern. Moldova still is in the lead, but it is followed closely by Ukraine and Georgia and further away by Armenia. Azerbaijan and Belarus are again far behind. Ukraine, Azerbaijan and Belarus show decline compared to last year’s Index, while Armenia shows improvement. No changes are recorded in the case of Moldova and Georgia.

 

Human Rights including Equal Opportunities and Non-Discrimination

This category of the Index looks at civil liberties and adoption of international standards in the field of human rights. It also includes the very detailed and elaborate subcategory Equal Opportunities and Non-Discrimination.
Civil liberties are most severely violated in Belarus and most protected in Moldova and Ukraine. Belarus is notorious for being the only country in Europe that retains the death penalty and for its lack of international cooperation on the prevention of torture. While Azerbaijan adhered to many international instruments on human rights, its practice of protecting civil liberties is the second worst among the EaP countries.

Ukraine’s record on human rights improved compared to the Index 2012 due to the fact that a free legal aid system was introduced in January 2013, although it is still limited to criminal cases and receives only limited funding from the state. Additionally, Ukraine established a National Preventive Mechanism according to the criteria of the Optional Protocol to the UN Convention against Torture (OPCAT). It is the Ombudsman who performs this function. We also noted certain improvement in the area of non-discrimination, since Ukraine adopted a relevant framework law. However, the law fails to comply with EU requirements for such laws and a new amended version is required. Nevertheless, the adoption of this law should be acknowledged as a step in the right direction.

Moldova also saw improvement in human rights during 2012 and early 2013. Although freedom of expression slightly deteriorated according to Freedom House, Moldova adopted a framework anti-discrimination law in May 2012, the first EaP country to do so despite domestic tensions. The new law was generally praised by the EU.

The human rights situation in the other four EaP countries has not undergone any significant changes.

Observance of the principle of non-discrimination and adoption of measures to guarantee equality through new legislation remained high on the bilateral agenda of the EU and EaP countries. Adoption of comprehensive and effective legislation is one of the requirements for future visa-free travel. Three major groups of indicators were used to assess the state of play and progress of EaP countries in this area: ratification of international non-discrimination legal instruments; domestic anti-discrimination legislation; and policy, the latter including the degree of empowerment of disadvantaged social groups.

In the area of ratification of international legal instruments Ukraine remains a leader among EaP states. Moldova and Armenia follow closely, both countries progressing at the same pace. Interestingly, Azerbaijan signed up to more international legal instruments than Georgia. Belarus is the most reluctant EaP country in signing up to international human rights instruments. It is also the only European country not yet a member of the Council of Europe.

When it comes to anti-discrimination legislation, two EaP countries showed progress in this area by adopting national framework anti-discrimination legislation in 2012 — Moldova and Ukraine. Moldova’s pioneering law on ensuring equality was adopted in May 2012. Ukraine followed in October 2012. However, according to EU assessment Ukraine’s law on anti-discrimination does not meet basic European standards, as it does not provide sufficient protection to certain categories. Until Ukraine revises its current legislation its progress cannot be considered sufficient.

All EaP countries have provisions prohibiting discrimination in their Constitutions. However, a clear distinction should be made between Georgia and Moldova, where the Constitutions contain solely an overarching requirement of equal treatment and do not prohibit discrimination per se, and other EaP countries where the Constitutions more explicitly prohibit discrimination and thus afford a higher level of protection.
All EaP countries guarantee certain protection from discrimination within their penal laws, labour laws and education laws. Moldova introduced changes into its criminal and contraventional codes. It also explicitly prohibited discrimination on the grounds of sexual orientation in employment. The EU asked the Ukrainian authorities to prohibit discrimination on the grounds of sexual orientation in its Labour Code. This request was met by a huge wave of criticism from Ukrainian religious groups, who considered it a threat to so-called traditional values. As a result MPs from different political parties, including the opposition, are now reluctant to vote for the relevant changes despite pressure from the EU and domestic civil society.

The situation as regards protection from discrimination on a broader range of grounds remains almost without change across the EaP countries. The EaP states are uniform in the number of ‘factual’ grounds on which protection against discrimination is guaranteed. The leaders in this aspect are Moldova, Ukraine and Georgia, as they guarantee protection on the largest number of specific grounds, including sexual orientation in Moldova and Georgia. Ukraine and Moldova should be praised for keeping the list of protected grounds open in its legislation, since as courts tend to interpret the law broadly this might mean de-facto that the law covers discrimination on unlimited kinds of grounds. Other EaP countries have not provided the same scope of protection.

Ukraine and Moldova introduced clear definitions of direct and indirect discrimination and harassment. The latter is also defined and prohibited in the Armenian legislation. Failure to provide reasonable accommodation is defined only in the Moldovan anti-discrimination law, while all other countries fail to regulate this guarantee. The Moldovan anti-discrimination law is the most comprehensive and covers all major spheres to guaranty better protection. It covers assumed discrimination, discrimination by association and multiple forms of discrimination. The Ukrainian framework law covers these issues only partially, while Armenia prohibits discrimination by association and Georgia provides for the prohibition of assumed discrimination in such area as public healthcare. All EaP countries, except for Moldova, Azerbaijan and partly Ukraine, fail to establish affirmative action measures to ensure prevention of future discrimination and redress for past discrimination.

When it comes to enforcement mechanisms all EaP countries except Moldova follow the same model of the Ombudsman office acting as the national equality body. In Ukraine one of the four specialised departments within the Ombudsman office works on non-discrimination, gender and children’s rights. In Georgia the Public Defender’s Office deals with non-discrimination and simultaneously runs the Tolerance Centre and two Civil Councils, one on National Minorities and another on Religious Minorities. Belarus, Armenia and Azerbaijan showed no progress in enforcing equality. Moldova is the only country in the region that set up a specialised equality body – the Council on Ensuring Equality and Combating Discrimination. The Council is composed of five members from civil society appointed by the parliament and investigates cases of discrimination.

 

Independent Judiciary

Georgia and Moldova have implemented the most rules and procedures guaranteeing an independent and professional judiciary. Not only did both countries show the best results among the EaP states in the current Index, they also improved their performance as compared to the Index 2012. The indicators of an independent judiciary improved in Armenia as well, while they deteriorated in Ukraine and Azerbaijan. Belarus showed no progress whatsoever.

The biggest problem in this areas in all EaP countries is the lack of sufficient guarantees that the appointment, promotion and dismissal of judges is guided only by professional standards and is free from political meddling. This problem appears to be most severe in Azerbaijan and Belarus where the president has extensive powers over judges. Armenia lags behind the frontrunners, Georgia and Moldova. Ukraine is far behind as it has serious problems not only with impartial appointment, promotion and dismissal procedures, but also with the weak protection of judges against harassment, assault and even assassination.

When it comes to the institutional independence of the judiciary the discrepancies among the EaP countries are less evident. Georgia, Moldova and Armenia are the frontrunners, while Ukraine and Azerbaijan both lag behind on the same level, leaving Belarus even further behind. Where financial independence is concerned, the situation appears to be the worst in Azerbaijan and Belarus, where the judiciary is financed by the government or only through informal mechanisms, putting it under the direct control of the president.

In all EaP countries, apart from Belarus and Azerbaijan, the judiciary retains strong powers without significant changes compared to the Index 2012.

When it comes to accountability and transparency of the judiciary, Moldova shows improvement, while Armenia and Azerbaijan show decline compared to the Index 2012. Georgia retained its leading position, while Ukraine stayed somewhere between the frontrunners (Georgia, Moldova and Armenia) and Belarus and Azerbaijan at the other end of the scale.

Internal rules, such as a code of ethics for the judiciary system, are partially provided in Ukraine and Moldova. In Ukraine the Congress of Judges adopted a fully revised version of the Code of Judicial Ethics in February 2013. However, its provisions duplicate the existing legislation in many respects, while at the same time fail to provide answers to a lot of practical questions. Judicial ethics training exists in Ukraine; however, its content is not practical in nature.

None of the six countries ensure that judicial deliberation is sufficiently protected from undue influences by senior judges, private interests or officials from other branches of power. Only Georgia and Moldova have a judicial self-governing body that has a decisive influence on the career paths of judges, with the majority of members elected by judges. Establishing this element of self-government in the court system is key to depoliticising appointment and promotion decisions, but this step requires that incumbent judges be of outstanding integrity and not abuse their immunity to violate the law. Protecting functional immunity while maintaining accountability is a problem that has not been adequately solved in most EaP countries.

Quality of public administration

The quality of public administration is an important prerequisite to ensure effective reform in any country. The EaP Index considers such aspects as policy formulation and coordination and impartial and professional civil service, the latter including legal, institutional and procedural aspects and the management of public service quality. The current Index shows an absence of any significant developments in this field compared to last year.
Moldova has the best quality of public administration in the region. The country also improved indicators in policy formulation, coordination and assessment, as well as the state of the civil service. Armenia follows second. A new law on public service entered into force in Armenia last year. It launched the formation of commissions on the ethics of civil servants and senior officials. However, the activities of these commissions are not fully unbiased.

Ukraine comes third in this category. A new responsibility has been added to the portfolio of the Minister of the Cabinet of Ministers to ensure the effective functioning of the civil service. Moreover, a novelty was introduced, which helps to ensure the higher quality of service delivery. Citizens are informed about the standards that they can expect and if a certain service does not match up to the required level of quality they can launch an appeal.
Georgia follows Ukraine. Although overall its public administration still needs major improvements, Georgia shows good results in the quality of public service and rates second after Moldova here. Additionally the practice of public consultations in Georgia has slightly improved.

Azerbaijan lags slightly behind. Nevertheless, a new system, the so called Azerbaijan Service and Assessment Network (ASAN - asan.gov.az), was established. It provides administrative services to the population and to a certain degree reduces the possibilities for petty corruption.

Belarus has the worst quality of public administration among the EaP countries. However, it is worth noting that a new law adopted in 2012 put in place a uniform process for the promotion of civil servants and provides civil servants with access to their personal files.

 

Fighting corruption

The current Index shows no significant changes in the field of fighting corruption in most EaP countries compared to the Index 2012. Two countries, Georgia and Belarus, improved their indicators during the last year. Overall Georgia and Moldova are the leaders in fighting corruption. Armenia comes third, followed by Ukraine. Belarus and Azerbaijan switched positions. Currently Azerbaijan has the worst indicators on fighting corruption in the region.

Despite overall low scores, Belarus made progress in preventing corruption. In April 2012 the law on fighting corruption was amended to include a new definition of ‘state official’ and a new list of persons required to submit declarations of income and property. The law introduced a new definition of ‘conflict of interests’ and set measures for its prevention and settlement. The number of corruption crimes decreased from 2416 in 2011 to 1779 in 2012. In Georgia, the powers and independence of the State Audit Office — the supreme audit institution — were strengthened.

Supreme audit institutions exist in all EaP countries. However, the Belarusian State Control Committee lacks institutional independence safeguards and the Azeri Chamber of Accounts heavily depends on the President’s Administration. In Georgia, the State Audit Office, although institutionally independent from the executive branch, did not manage to fully exercise its new task of monitoring political parties and campaign financing in the run up to parliamentary elections without bias.

There are legislative guarantees ensuring protection against arbitrary dismissal for the heads of the audit agencies in all countries of the Eastern Partnership, except for Belarus, where the head of the State Control Committee is appointed and dismissed directly by the President.

A regulatory framework governing transparency and parliamentary scrutiny of the audits carried out by the audit agencies is in place in Armenia, Georgia, Moldova and Ukraine. However, findings of the audit agencies do not receive sufficient attention in any of the Eastern Partnership countries.

Public procurement remains the area most prone to corruption. Although legislation requires competitive bidding in all cases of major procurements, vaguely formulated exceptions create a risk of arbitrary interpretation of the law in Ukraine and Georgia, while in Azerbaijan and Armenia requirements of the legislation are not often respected in practice. Public procurement regulations and results of major public procurement bids are nevertheless easily accessible to the general public in all six countries of the Eastern Partnership.

Accountability

A properly functioning system of checks and balances necessarily implies the accountability of the executive to the legislative branch, where those elected by the public can control and hold representatives of the government accountable. However, for a legislator to effectively exercise its control over the executive branch, adequate constitutional and institutional mechanisms have to be in place. If one recognises that the level of accountability might vary depending on the constitutional model of a particular country, drawing parallels or finding differences among the EaP countries might not reflect the complexity of the reality. Notwithstanding, major trends could nevertheless be identified.

Moldova, being a parliamentary republic, is the frontrunner among the six Eastern Partnership countries, followed by Ukraine, Armenia and Georgia. Moldova still remains the only country in the Eastern Partnership that allocates positions as parliamentary committee chairs to the opposition allowing the minority to influence the political agenda in the parliament.

Compared with last year’s Index Georgia and Armenia improved their scores. This positive dynamic in strengthening the role of legislative bodies in Georgia and Armenia can be attributed to the results of the parliamentary elections conducted in these countries during the reporting period. The election in Georgia resulted in a considerably changed seat differential between the governing coalition and the main opposition party giving more space for alterative opinions in the parliament. Compared to data from the previous parliament, the number of bills submitted by opposition deputies has increased in Armenia.

Belarus and Azerbaijan score the lowest as their parliaments have limited power or only formally exercise oversight over the executive branch. The legislators of the two countries do not play a role in the appointment of the cabinet of ministers, have limited law-making power and lack control over the ‘power ministries’. Belarus is the only country where the president de-facto decides who can become a member of the legislature (although, according to the Constitution, he can only appoint 8 members of the upper chamber) and the budget of the parliament is under the control of the President’s administration.

Legislators in Armenia, Georgia, Moldova and Ukraine have the power to summon government officials and have regular hearings with representatives of the executive branch. While the parliaments of these countries have constitutional powers to conduct independent investigations in case of abuse of power by government representatives, how these commissions operate is not clear in Ukraine and Armenia. In Georgia, creation of a temporary investigative commission depends on the will of the majority in the parliament. Legislators in Belarus and Azerbaijan completely lack these powers.
In terms of parliamentary control over the agencies of coercion, only in Moldova does the parliament effectively exercise this function. In Ukraine and Georgia legislators can exert general control over these agencies through parliamentary interpellation, but it is not in their authority to dismiss the ministers of defence and interior.

The powers of the legislative branch in the formation of the government are limited in most EaP countries. Only in Georgia and Moldova is a vote of confidence by the parliament required for the appointment of the cabinet of ministers. Despite the limited functions of the legislative branch in Azerbaijan it is the only country where the president does not have power to dissolve the parliament.

Legislative bodies in all six countries have a formal mechanism to override the presidential veto – a power not frequently exercised by legislators in practice. However, during the reporting period, the parliament of Georgia successfully overrode the presidential veto a number of times. Generally, parliamentarians in Eastern Partnership countries enjoy immunity from criminal prosecution. However, in recent years there have been cases of allegedly politically motivated criminal prosecutions against individual parliamentarians in Armenia and Azerbaijan.

Democratic Control over Security and Law Enforcement Institutions

Irrespective of the seriousness of the alleged threat, security concerns cannot override the rule of law in a democratic state. Accordingly, the extent to which legislative bodies, national human rights institutions and civil society have the possibility to exercise control over law enforcement and security services is a crucial indicator of the state of democracy. In order to understand whether the six Eastern Partnership countries satisfy this criteria, the Index looks at the internal regulations within the security and law enforcement bodies, the level of control exercised by the parliament and national human rights institutions in cases of abuse of power by police, army and security personnel, and transparency and openness of those institutions.

Similarly to the Index 2012, Moldova shows the best system of democratic control over its security institutions, followed by Ukraine. Georgia and Armenia lag somewhat behind, while Belarus and Azerbaijan have the worst scores. Ukraine, Georgia and especially Moldova improved their performance, while the situation in the other three EaP countries almost did not change.

Excessive use of force by police and security personnel while handling demonstrations has been a concern in almost all EaP countries during the last three years, except for Moldova where the last case of police violence in crowd control was registered in April 2009. Moldova also adopted a new law clearly defining the principle of proportionality for law enforcers while applying coercive measures, thus considerably strengthening its position in this category of the Index. In contrast with Moldova, relevant legislation in Belarus and Azerbaijan lacks the necessary precision on the use of lethal force and fails to secure a system of adequate and effective safeguards against arbitrariness. Internal control and enforcement mechanisms to deal with abuse of power by security and law enforcement agencies exist in all six countries. However, the effectiveness of such mechanisms is questionable everywhere except for in Moldova.

Theoretically, parliaments in all EaP countries have the possibility to exercise control over security forces. What form this control takes varies from country to country. The legislative bodies in Ukraine, Georgia, Belarus and Azerbaijan are either reluctant or lack the possibility to use this leverage effectively. For instance, the law enforcement ministries usually do not report to the parliament in Belarus and Azerbaijan. At the same time in all six countries the speaker of the parliament is a member of the National Security Council. However, only in Moldova are the decisions of the Council subject to parliamentary scrutiny.

The control exercised by the Ombudsman’s Office over security and law enforcement bodies is considerably weak in Azerbaijan and there is no such human rights institution in Belarus. Over the last three years there have been cases of persecution and intimidation of journalists and representatives of civil society organisations in Azerbaijan, Armenia, Belarus and Georgia. Lack of transparency in the law enforcement and security bodies remains a problem in all EaP counties. However, the situation in Georgia improved since last year, whereby meetings with civil society organisations and the Ministry of Justice became institutionalised.

Market Economy
 
In assessing domestic economic performance and market economy status we focused on the qual­ity of the business climate in the countries and their transition progress. The analysis is based on widely used indicators for international economic comparison rather than country size, specific factors and short-term shocks. In particular, we used indices produced by the World Bank (Doing Business), EBRD (Transition Reports), World Eco­nomic Forum and the Heritage Foundation.
 
A number of conclusions can be drawn from the analysis. According to the World Bank Doing Business (DB) 2013, Georgia has preserved its leading position in the category ease of doing business among the EaP countries. Armenia holds the second place. Despite significant prog­ress in starting-up businesses and paying taxes, Ukraine still has the least attractive business climate in the group. In general, five out of the six EaP countries im­proved their performance compared to the results in the DB 2012. A reduction was registered only in Azerbaijan. Armenia and Ukraine were the front-runners in terms of positive changes.
 
Four of the six EaP countries — Armenia, Azer­baijan, Belarus and Georgia — ensure that busi­nesses can be established quickly, both in terms of time and monetary costs, thus allowing free entry to the market. Ukraine has also achieved significant progress in freeing market entrance thanks to reductions in the time, cost and num­ber of associated procedures required. Neverthe­less, the country is still lagging far behind the group average, especially when it comes to the duration of registration procedures.
 
At the same time, all countries have set up ob­stacles for resolving insolvency, thus preventing free market exit, which is another basic principle of the market economy. Armenia and Belarus are the leaders in ease of resolving insolvency, while Ukraine has the worst ranking due to high associ­ated costs and low recovery rate. The situation considerably deteriorated in two markets — Be­larus and Georgia.
 
Paying taxes remained quite cumbersome in all EaP countries, except for Georgia that features a low tax rate and a system of only five payments per year. Four out of six EaP countries demon­strated significant progress in the simplification of tax payments, while the situation in Azerbai­jan improved only slightly and Belarus regressed. Ukraine is still the worst performer in the group.
 
The EaP countries have a moderate standing in contract enforcement, with the exception of Ar­menia whose performance worsened in compari­son with the DB 2012 as the country increased delays. Belarus holds the leading position in ease of contract enforcement according to DB 2013 with the lowest number of procedures. According to Heritage Foundation assessments, enforce­ment of property rights has remained quite weak in all the EaP countries and corruption constitutes a serious challenge for the economic development of the region.
 
The EBRD country transition indicators show that five out of six EaP countries, with Belarus remaining the exception, have achieved com­prehensive price and trade liberalisation and completed the privatisation of small companies with tradable ownership rights. The progress in large scale privatisation is not uniform across the EaP countries. The most significant prog­ress in large-scale privatisation and corporate governance is registered in Georgia and Armenia, while Azerbaijan and Belarus preserved state ownership for a considerable part of the economy and the process of large privatisation is just at the beginning. All EaP countries feature little progress in governance and enterprise restructur­ing and in competition policy reform. According to the World Economic Forum the effectiveness of promotion of competition policy in the EaP countries is quite moderate.
 
There is very little change in the EBRD sec­tor transition indicators of the EaP countries compared to last year’s Index. All EaP countries have room for improvement in market structure and market-supporting institutions and poli­cies in the majority of sectors. Armenia, Georgia, Ukraine and Moldova have a relatively more developed market structure, while Belarus and Azerbaijan are lagging behind. Across sectors, the corporate sector and selected sectors in infra­structure have been developed the most. At the same time, further regulatory efforts should be devoted to the development of the financial and energy sectors.
 
There seems to be no direct link between trade turnover between the EU and each of the EaP countries, on the one hand, and business climate, on the other. For instance, Ukraine has the most intensive trade with the EU and is the largest recipient of FDI from the EU, partly determined by the size of the country, and yet its business climate is the worst among the EaP countries. However, once the business climate improves, it further boosts investments and trade between the parties.
 
Towards DCFTA
 
Deep and Comprehensive Free Trade Agreement (DCFTA) along with the prospect of visa-free travel are the two biggest incentives that the EU offers to its partner countries within the Eastern Partnership Initiative. DCFTA is the most com­prehensive free trade arrangement that the EU has so far offered to any third country, which will have profound implications for domestic reforms in EaP countries.
 
The DCFTA part of the Index looks at all the sectors that are relevant to the free trade area and that are included as chapters in the Associa­tion Agreements (AA) between the EU and EaP countries. The AA with Ukraine is now technically ready for signing and the text is published. At the same time the EU concluded negotiations with Moldova, Georgia and Armenia. The EU cannot start DCFTA negotiations with Azerbaijan before the country’s accession to WTO, while DCFTA is not at the moment in sight for Belarus.
 
The six EaP countries can be divided into three pairs according to their DCFT performance. Georgia and Moldova are the best performers, as they demonstrate the highest level of compli­ance with DCFTA requirements and both made progress compared to last year. This is despite the fact that both countries started DCFTA negotia­tions much later than Ukraine and concluded the negotiations faster. Ukraine and Armenia are on the same level, but below the frontrunners. The difference is that Ukraine’s performance deterio­rated, while that of Armenia improved. Azerbai­jan and Belarus lag behind and find themselves almost on the same level. The fact that Belarus and Azerbaijan are on the same level is interest­ing since Belarus is a member of the Customs Union of Belarus, the Russian Federation and Kazakhstan and therefore cannot have a free trade area with the EU independently from the Customs Union. This might mean that trade with the EU is still attractive for Belarus and a lim­ited level of regulatory adjustment is needed in order to increase trade flows. However, in 2012 both countries slowed down in meeting DCFTA requirements.
 
Liberalisation of trade policy is one of the key DCFTA requirements. Moldova, Ukraine and Armenia pursue the most liberal trade policies. Georgia made significant progress in 2012 and is catching up with the frontrunners. Azerbaijan has the most protectionist trade policy.
 
Ukraine’s sanitary and phito-sanitary standards are the most compatible from the region with DCFTA requirements. It is the only country that made progress in 2012 leaving the other coun­tries far behind.
 
All six countries score rather highly when it comes to customs and trade facilitation provi­sions and there is no change compared to last year.
 
Regulations for services and establishments are also rather developed in all six countries with Be­larus lagging behind. Armenia made the biggest improvement, while Azerbaijan’s performance worsened.
 
Capital provisions are the most developed in Moldova, Georgia and Armenia. Ukraine demon­strates a mixed pattern — halfway between good conditions for the free movement of capital and too much state regulation. For instance, there are restrictions on the acquisition of agricultural land by foreigners and administrative procedures that limit the free movement of capital. In Belarus and Azerbaijan capital market is too heavily con­trolled by the state. Four countries — Moldova, Armenia, Georgia and Azerbaijan – fully meet EU intellectual prop­erty rights requirements. Ukraine and Belarus lag behind as countries that offer low protection in the United States Trade Representative (USTR) watch list.
 
Georgia is the only country in the region that meets EU geographical indications requirements. Moldova’s performance is also relatively high, while the other four countries lag far behind at approximately the same level.
 
Competition and state aid requirements are fully met only in Georgia. The gap among the coun­tries in this area is large. Moldova comes second, followed by Ukraine and Armenia. Belarus and Azerbaijan are far from meeting EU requirements in this area. Moldova and Armenia both made significant progress compared to last year.
 
All these differences no doubt reflect the level of political will in each country to meet EU require­ments. However, one should also take the differ­ences in structures of domestic economies into account. The large production sector in Ukraine naturally advocates for more protectionist measures and the costs of adjustment in Ukraine might be higher than in Georgia, Moldova and Armenia, at least from the perspective of strong interest groups.
 

Freedom, Security and Justice
 

Freedom, Security and Justice (FSJ) remains a key area of cooperation between the EU and EaP countries. The EU pursues the creation of an area of security and prosperity at its Eastern border, while the EaP governments declare their commit­ment to fighting against corruption, organised crime, illegal migration, human trafficking and promoting efficient law-enforcement and human rights.

The catalyst for efficient cooperation in FSJ matters is the EU’s promise to all EaP countries of at some point visa-free travel to the EU under certain conditions. This visa policy became one of the most effective foreign policy tools used by the EU to encourage reforms in the EaP countries. The prospect of visa-free travel is appealing to both the political elite and ordinary citizens. For most EaP countries’ governing elites this pros­pect became a more powerful incentive than that of full EU membership, as politicians are willing to deliver results while still in office in order to in­crease their chances to hold on to power. Whilst the prospect of membership remains a long way off and impacts minimally on ordinary people in the short term, visa-free travel would benefit all citizens, thus increasing support for the incum­bent government.

The EaP Index measures the level of cooperation of each EaP country with the EU on FSJ mat­ters and implementation of domestic reforms required by the EU, mostly included in the Action Plans on Visa Liberalisation (APVL).

The 2013 Index confirms Moldova’s leading posi­tion in implementing required reforms. Ukraine is lagging behind Moldova and the gap between Chisinau and Kyiv is increasing both institution­ally and technically. Moldova moved to the sec­ond phase of APVL in 2012, which is largely well implemented, while Ukraine is still in the first phase. Kyiv still needs to adopt and implement a comprehensive anti-discrimination law in line with European standards and establish an inde­pendent anti-corruption agency. Georgia is slowly catching up with Moldova and technically has almost reached Ukraine’s level. The country was handed an APVL in February 2013 and started implementing many of the prescribed reforms even prior to this event, especially on combating corruption.

Armenia has not yet received an APVL. Despite this fact, Armenia started a series of reforms aimed at aligning its legislation with EU stan­ dards and showed progress in 2012. Belarus and Azerbaijan are far from receiving an APVL, since, unlike the other four EaP countries, they have not even concluded visa facilitation agreements with the EU. The latter facilitates the process of issuing Schengen visas to certain categories of EaP citizens by EU member states’ consulates. One particular impediment to greater progress in Azerbaijan and Belarus is the worsening human rights situation and limited cooperation with the EU in some of the FSJ areas. Belarus continues to register the lowest results among the EaP countries. One has to note, though, that Belarus receives the highest number of both EU and Schengen visas per capita among the EaP coun­tries. This probably has to do with the informal policy pursued by EU member states’ consulates of facilitating greater mobility for Belarus citizens as a counterbalance against the authoritarian regime.

Four countries – Ukraine, Moldova, Georgia and Armenia – have visa facilitation and readmission agreements with the EU, while Azerbaijan is ex­pected to sign them in November 2013. Moldova and Ukraine signed the second generation of visa facilitation agreements, which further eases visa requirements and broadens the list of categories of citizens eligible for visa facilitation.

All countries of the region are relatively advanced in ensuring document security, except for the fact that not all states issue biometric passports. Ukraine has a legal framework for biometric passports, but lacks the necessary secondary legislation, which prevents issuance of the new documents. Belarus started to issue biometric passports as a pilot project. However, it is not clear to what extent these are in accordance with the International Civil Aviation Organization standards. While the remaining countries issue biometric passports, not all of them have plans in place to phase-out the old travel documents.

Most EaP countries have good standards in the area of irregular migration. Some shortcomings are observed in Georgia, where there is no compe­tent civilian authority dealing with migration and Azerbaijan which does not have a framework document on migration. Compared to previous years, the EaP countries progressed in most areas related to migration, integrated border manage­ment and asylum. Belarus and Armenia still score low on border management both in Linkage and Approximation.

Public security and order represents one of the most difficult areas to reform. Countries show good progress in terms of adoption of legisla­tion, which is a part of Approximation, while the Linkage dimension scores remain low for most countries. The implementation of recently adopted laws remains a challenge. Only Georgia shows a high level of controlling corruption in our Index, based on indicators from Transparency International and the World Bank, leaving other countries behind with Ukraine and Azerbaijan showing the worst results.

The reforms in the area of external relations and human rights are difficult to implement for most of the countries. Moldova was the only country to adopt an anti-discrimination law in line with basic standards of the EU in 2012. The rest of the countries have no specific or general legislation in place and as such no effective mechanism for protection against discrimination, in particular for sexual minorities.

The Linkage and Approximation dimensions of FSJ show no major discrepancies. In most cases developed links with the EU in this area trans­late into a better domestic reform process. Yet, one could highlight that Georgia, Armenia and Azerbaijan seem to exert more efforts where domestic reforms are concerned than Ukraine. For instance, Georgia shows almost the same level of approximation as Ukraine, although its links with the EU are far less developed. Armenia and Azerbaijan, although disadvantaged in terms of links with the EU, are also catching up with domestic reforms. Thus, although most countries adopted impor­tant new legislation in 2012, the hard work remains to be done in 2013 and 2014 when most of the legislation will have to be implemented in a comprehensive and sustainable manner. To make this happen the authorities and societies of the EaP countries will have to put in signifi­cant efforts and resources. This will pave the way for visa-free travel to the EU, but first of all to a modern justice and security system based on European standards that could offer more rights and opportunities to citizens.

Energy
 

Trade-related and other economic factors matter more for EaP countries’ Linkage with the EU in the field of energy than participation in multilat­eral dialogue mechanisms initiated or supported by the EU. In this regard Armenia is a very minor player with little trade between the EU and Arme­nia. Azerbaijan, Georgia and Belarus are mainly exporting fuels and minerals to the EU. Ukraine and Moldova are increasingly importing energy from the EU. The engagement with Azerbaijan is set to grow as it will become the main supplier in the future Southern Gas Corridor, while Georgia and Ukraine will remain key transit countries.

The EaP countries are slowly yet confidently transforming their energy sectors in accordance with EU regulations. The success of such change largely depends on the systematic nature of approach of the country. For instance, Belarus distances itself from any cooperation on energy and demonstrates a poor performance in energy reforms. Both Azerbaijan and Armenia made significant steps in gas and electricity market restructuring. Azerbaijan signed a Memorandum of Understanding on energy sector cooperation with the EU and Armenia gained observer status in the Energy Community. Armenia and partly Moldova implemented ownership unbundling rules. Armenia also established an independent regulator, similar to Georgia and Moldova. Georgia, who applied for membership to the Energy Community, is still way behind Ukraine and Moldova who are already full members. Yet, Georgia offers free access to infrastructure and has better energy efficiency indicators than any EaP country. At the same time Kyiv and Chisinau have the highest level of formal commitments but show moderate progress in implementation of the acquis communautaire. The Ukrainian energy market is being liberalised in both gas and electricity sectors, while the Moldovan market is more open and non-discriminatory. Both coun­tries developed renewable energy national targets and greenhouse emissions reduction mechanisms. However, none of the EaP countries started to implement the far-reaching reforms within the Third Energy Package.

In comparison to the period assessed in the previ­ous Index energy consumption of EaP countries changed slightly. Belarus, Moldova and Georgia were most successful in reducing energy inten­sity and greenhous gas (GHG) emissions, while Ukraine and Armenia showed almost no progress.

In order to produce sustainable results in reform­ing the energy sector the EU should increase its technical and expert support. Regulatory approxi­mation should be followed by effective enforce­ment of the new rules. Approximation should also address the structure of the energy markets by optimising the energy mix and developing infra­structure, including cross-border connections. Only such a holistic approach can provide better energy security for both the EU and partner countries.

Transport

Transport plays an important role in the facilita­tion of economic cooperation, trade and people-to-people contacts. However, the development of transport infrastructure lacked appropriate attention from the EU in recent years most prob­ably due to the financial troubles of the euro zone.

Some improvement in transport policies and infrastructure in the EaP countries was registered mainly due to initiatives launched in the late 2000s or to substantial domestic support.

The Linkage dimension reflects the lack of rela­tively recent integration initiatives in the field of transport. For instance, in the aviation sector one of the EU’s priorities is the enlargement of the Common Aviation Area (CAA). Georgia and Mol­dova already signed agreements on CAA, but their ratification on the side of the EU is pending. The progress of Azerbaijan and particularly Ukraine, who started talks in 2007, is considerably slower. Belarus and Armenia have not started negotia­tions on joining the CAA, although Armenia started approximation with the EU aviation safety legislation. Some progress was achieved in strengthening administrative capacities of transport bodies mainly due to joint projects with the EU launched some years ago. In particular, independent or quasi-independent transport incident investigating bodies were finally created to correspond to the EU’s safety requirements.

The Approximation dimension illustrates a somewhat different trend. Mostly driven by the scarcity of financial means to invest in transport infrastructure, EaP countries initiated reforms in the transport sector. These have been aimed at reducing the state’s power in transportation and at attracting private investments. Following this model, Ukraine adopted relatively liberal legisla­tion regulating ports and railway freight. Moldo­va also started reforming its railways and allowed concessions of airports. Armenia and Georgia have liberalised almost all transport markets.

The EU’s relatively decelerating involvement in the field of transport has resulted in lack of progress in safety aspects and in ongoing EaP countries’ reluctance to establish independent transport regulatory bodies. In particular, the number of road accidents remains substantial and their rate did not change across the countries compared to the Index 2012. Also, the Index 2013 shows no considerable improvements in transport regulation.

In previous years Ukraine was the leader in the field of transport, but recently Moldova and the Caucasus countries, in particular Georgia, caught up. Armenia, Azerbaijan and Georgia have increased the quality of transport services and ensured greater participation of private compa­nies in their provision. Meanwhile, Ukraine and Belarus having a closer geographical position to the EU lag far behind in transport development. Namely, Belarus has not adjusted to the EU’s standards and policies despite having the largest share of land connections to the EU among the EaP countries.

Environment and Sustainable Development
 

In this Index all countries except Moldova, who was the best performer in the previous Index, improved their scores. Ukraine achieved the big­gest increase. The gap between the best and worst environmental performers tended to reduce, al­though Moldova still remains the leader. Belarus is in second place. Armenia took over the third position from Georgia. Ukraine and Azerbaijan have the lowest results, due to high pressure on the environment and complicated environmental conditions. Georgia is in fourth position being very close to Ukraine.

The Index assessment here is composed of two major parts: 1) environment, climate change and sustainable development policy; and 2) resource efficiency, pressure on and state of the environ­ment.

In the first part Moldova has the highest result mainly for starting preparation of a national en­vironmental policy and a Shared Environmental Information System Action Plan. Ukraine follows second and Armenia third. Georgia and Belarus come next. Azerbaijan closes the ‘policy’ chart with a significant gap.

Although Moldova still leads on policy adoption, no considerable progress in environmental policy integration (EPI) has been achieved. Nevertheless, Moldova has never been recognised as non-com­pliant under the main conventions with compli­ance mechanisms. Ukraine is in second position in terms of policy development and implementa­tion. It has been implementing the new environ­mental law on the State Environmental Strategy and the governmental National Environmental Action Plan (NEAP), where the EPI is a core prin­ciple, but last year’s attempts to adopt EPI instru­ments concerning Environmental Impact Assess­ment (EIA) and public participation in EIA failed. The 2011 decisions on Ukraine’s non-compliance with the Aarhus and Espoo UN ECE Conventions have not been lifted. After implementing the recommendation of the Compliance Committee of the Kyoto Protocol, the suspension imposed on Ukraine in 2011 under the Kyoto Protocol of the United Nations Framework Convention on Climate Change (UNFCCC) was lifted in March 2012.

Armenia ranks third and remains the only coun­try among the six EaP states that has ratified the Protocol on Strategic Environmental Assess­ment to the Espoo Convention, one of the main EPI instruments. Only three countries (Ukraine, Georgia and Armenia) have separate environ­mental policies adopted by the government or parliament. Armenia started to develop the third generation of the NEAP in 2013.

Georgia and Belarus share fourth place in the ranking. Georgia adopted the second generation of the NEAP in January 2012. It is the only coun­try from the region that is yet neither a signatory nor party to the Espoo Convention. Belarus rati­fied the Bern Convention on European Wildlife and Natural Habitats in 2013. Ukraine keeps the lead in the region regarding the number of En­vironmental Conventions and Protocols ratified. The environmental policy and legislation develop­ment process shows some positive dynamics in Azerbaijan as well, since a new draft law on EIA has been recently submitted for adoption and a separate environmental policy development is envisaged.

In terms of sustainable development (SD) policy, Belarus is implementing a National Strategy for sustainable development for the period to 2020, which was adopted in 2004. Armenia has recently adopted the National Programme on Sustainable Development, elaborated with active public par­ticipation. The country has a functioning Nation­al Council on Sustainable Development (NCSD) under the President, where NGOs take part. The NCSD in Moldova was established with NGO par­ticipation and elements of SD strategy are being implemented in sectoral programmes such as on sustainable agriculture. For the period 2008-2015 Azerbaijan has two SD programmes: the State Programme for Sustainable Development of the Regions and the Sustainable Development and Poverty Elimination Programme. No SD policies have been adopted so far in Moldova, Georgia and Ukraine. The latter has, however, SD prin­ciples and elements incorporated into its State Environmental Strategy. All countries, except partially Armenia, lack effective SD institutional provisions at the national level, although prepara­tions for the Rio+20 Conference on Sustainable Development revitalised some SD-related activi­ties in the region. The 10-years framework policy on Sustainable Consumption and Production is under preparation in Armenia, Ukraine and Mol­dova. Discussions on the need for Green Economy policy is the most popular new trend after Rio+20 among the six EaP countries.

Several indicators were considered to assess sustainable development and trade. Ukraine rati­fied the greatest number of ILO conventions (69) among the EaP countries; 60 out of those are in force. Azerbaijan follows with 57 and 55 conven­tions correspondingly, Belarus 49 and 42, Mol­dova 42 and 40, Armenia 29 and 8 and Georgia closes the list with 16 ILO conventions ratified and effective. There is some progress in the introduction of the EU-comparable mechanism for prevention of illegal and unofficial fishery. A corresponding law was adopted in Moldova in 2006, while Ukraine adopted several relevant nor­mative acts in 2012. A slightly better situation is observed in control on legal trade in forestry, in particular in Armenia, Belarus and Ukraine.

Climate change policies are under different stages of preparation. The Low Emissions Development Strategy of Moldova, after public consultation in 2012, was sent to the government for approval in March 2013. Climate mitigation policy exists in all six EaP countries, but is varyingly devel­oped. Climate adaptation is a relatively new topic and policy instruments for its implementation are generally at the phase of preparation and/or adoption. There are difficulties in getting the Draft National Action Plans on Climate Change Adaptation agreed tosince there is a lack of inter­agency coordination on environmental matters that would help find the right balance between economic considerations and climate friendly economic activity.

The Index rating system and analysis of 12 indicators on resource efficiency, pressure on and state of environment demonstrate that Belarus remains the country with the best environmen­tal situation among the EaP partners, followed by Armenia and Georgia. Moldova is no longer among the top three countries and equalled with Azerbaijan. Ukraine has the worst results in this section. At the same time, Ukraine has shown the biggest progress in comparison with the 2012 In­dex. Armenia and Azerbaijan follow while Belarus, Georgia and Moldova performed worse than last year. Azerbaijan possesses the highest Water Exploitation Index (WEI), while in Armenia it has been significantly reduced. Both Moldova and Ukraine achieved some improvement in this indi­cator. Belarus remains the best with no changes in its WEI, as well as with the lowest level of wastewater discharge. While Ukraine’s and now Armenia’s WEI is comparable with the EU-27 av­erage, Azerbaijan’s is twice as high and growing. A slight reduction in water pollution is observed in Ukraine, Armenia and Moldova, but it has grown significantly in Azerbaijan and Georgia. Ukraine is the leader in SO2 pollution, showing approxi­mately three times higher emission than the EU-27, although the amount slightly reduced in 2012. Belarus has overtaken Ukraine in leading on NOx pollution in EaP countries in 2012.

At the same time, the level of individual con­sumption in all EaP countries still has not reached the EU-27 levels, which manifests in lower municipal waste production per capita by weight. The domestic waste generation per capita seems to not be changing or even to have reduced in kilos. However, there is a tendency that the waste structure is changing, therefore the volume is growing. The share of plastics is increasing and the overall recycling share dropped in Ukraine. Recycling has slightly improved in Armenia, grown in Moldova, reached in Azerbaijan 15% and grew in Belarus up to 16%, compared to a more than 22% average in the EU-27.

In terms of the intensity of countries’ activities to realise their emission reduction potential, which was considered as a target, Ukraine, Belarus and Moldova are leading in the region, although the reduction rate has slightly declined compared to last year’s Index.

Georgia has the highest pesticides input per hectare, almost twice exceeding the EU average. Moldova and Belarus correspond to the EU prac­tice, and Ukraine is the forerunner using only 0,6 kg per hectare and thus putting the least pressure on the soil. Meanwhile, the level of soil erosion remains very high in EaP countries. All of them exceed the EU-27 average. The worst situation is in Ukraine, where erosion reached 57.5% in 2011 and only slightly improved in 2012, still being three times higher than in the EU-27. Armenia follows with 42%, which is an improvement; Azerbaijan and Georgia stay without change with 36.4% and 33% correspondingly. The situation in Moldova and Belarus has worsened. In absolute figures the situation in these two countries still looks relatively well, but Moldova’s eroded areas grew by 4% in comparison with 2011 and now constitute 30% of the territory; and in Belarus soil erosion grew by 9% in 2012, constituting already 28% of the territory.

In terms of forest area, only Belarus and Georgia exceed the EU-27 share. The trend for Belarus is negative: 2% was lost in 2012. Other countries remain on the same level: Ukraine has propor­tionally half as much forestland as the EU-27 average, while Armenia, Azerbaijan and Moldova each have only one third. A similar situation is observed with natural protected areas. None of the EaP countries came close to the EU-27 average, however, Azerbaijan ranks highest with two thirds of EU areas, followed by Ukraine with one third and Moldova with one fourth being the worst. In 2012, the majority of countries enlarged their natural protected areas. Armenia was the best performer and increased its share by 3% in 2012, leading the EaP group with overall 12%. Ukraine, Moldova and Georgia have also improved the situation. Azerbaijan with a total 10% and Belarus with 7.7% share are second and third without change to the size of their natural protected areas.

The general conclusion can be drawn that the majority of the EaP countries are slowly progress­ing in environmental policy reform required by the bilateral agreements with the EU and Multilateral Environmental Agreements (MEAs). This refers to planning, adoption, implementa­tion and reporting of environmental policy and its sectors. Slight improvements in the water sector, waste management and soil rehabilitation signal some positive trends in the effectiveness of environmental protection measures. However, this is also the result of many years of long-term activities having a cumulative effect, since a year is too short a period to feel the difference in such stressed sectors as water and waste and even more so soil. Another factor is the quality of statistics, which is also gradually being improved. Overall, it is too early to conclude that the trends identified here are stable.

Interagency coordination and cooperation remains to be the main challenge in reducing environmental pressure and increasing resource efficiency. The trend of growing air pollution is observed in all countries with significant contri­bution from the energy sector. To combat this and other negative trends, the environmental governance reform should receive more attention and support within the countries’ cooperation with the EU.

The progress in policy elaboration and interna­tional cooperation was slower in some countries. The gap between the adoption of new strategies, plans and laws and the resource efficiency and the state of the environment has tended to reduce. Moldova remains the most successful in ensur­ing environmental policy effectiveness, followed by Belarus and Armenia. Despite having the biggest territory in Europe and inheriting heavy environmental problems from the past, Ukraine has shown the best overall positive dynamics in environmental performance in the current Index in comparison with the other EaP countries.

Policies on Education, Culture, Youth, Information Society

This part of the Index looks at the mobility of citi­zens, including students, at educational policies, focusing on the Bologna process, and at policies on education, culture, youth and information society.

Moldova is the best at using the opportunities for mobility to the EU and ranks highest in people-to-people contacts. Ukraine follows second, while Georgia and Armenia stay closely behind in third and fourth position.

In 2012 the EU countries issued the highest number of Schengen visas, about 1.3 million, to Ukraine. The number of Ukrainians travelling to the EU has increased in the last year, as a result of the facilitated visa regime. Although the EU does not have a visa facilitation agreement with Belarus, Belarusians are the most frequent travel­lers to the EU. Every 13th Belarusian received a Schengen visa last year and travelled at least once to the EU. At the opposite end of the scale, Ar­menia has the lowest number of Schengen visas issued and only 1 for every 715 Armenians had a visa to travel to the EU last year.

According to the migrant stock data for 2012 almost 8% of Moldovan citizens are residing legally in EU countries. Belarus is next with 3% of its population having moved to the EU. Ukraine has the biggest diaspora in the EU with more than 1 million of its citizens, or 2.35% of the entire population, living in the EU. Azeris are the least attracted to move to the EU, with less than 35,000 choosing this path.

Participation in EU programmes and agencies is open to all EaP countries that have Partnership and Cooperation Agreements (PCA) with the EU. However, despite Belarus not having a PCA, the EU opened several programmes for Belarus’ participation as well. Eligibility for participation in selected programmes and agencies is defined by the European Commission according to the needs of each country and is provided for in bi­lateral protocols. PCA Protocols were signed with Ukraine, Moldova and Armenia. Azerbaijan and Georgia are still negotiating their protocols. All six EaP countries participate in the 7th Frame­work Programme for Research and Technological Development (FP7).

Georgia is the most active participant in EU pro­grammes and agencies among the EaP countries. Armenia, Ukraine and Moldova follow next more or less at the same level. Azerbaijan and Belarus are the most reluctant participants.

Georgia hosted the highest number of youth proj­ects, 36, in 2012, compared to only one project each in Belarus and Azerbaijan. Armenia has the highest number of participants in youth exchang­es per capita, while Ukraine the lowest. Georgia also hosted the most EU volunteers per capita, while Armenia sent the most volunteers to the EU. Armenian students are the best at taking ad­vantage of the EU funded scholarship programme Erasmus Mundus, while Azeri students are the least keen.

Although Ukraine has the highest number of uni­versities involved in EU funded Tempus projects, compared to the total number of universities, the country ranks the lowest in this category. Armenian, Georgian and Moldovan universities participate more often in Tempus projects. All six countries had a similar level of involvement, 10-11 projects per country, in bilateral and multilateral projects of the European Training Foundation.

When it comes to the Bologna process and general education reforms, Georgia is the best performer. The country managed to undertake se­rious reforms back in the early 2000s and the cur­rent situation in many ways reflects that change. Belarus is lagging behind on the majority of education indicators. This is due to the fact that education in Belarus is totally subordinated to the government, while reforms are mostly formal. Other countries, notably Ukraine, Moldova, Ar­menia and Azerbaijan, have so far preserved the soviet legacy of the government trying to control universities and at the same time are implement­ing Bologna principles. Moldova still debates the new Code on Education, which, once adopted, will bring together all the legal provisions on educa­ tion and replace the outdated law on education from 1995. In Ukraine the three-cycle system is rather a formality, since it coexists with the old two-cycle system and limits the potential for the mobility of students. The situation is similar in Armenia where MA programmes exist rather as a variation of the old specialist programme.

The situation regarding the autonomy of uni­versities with respect to academic, institutional, personnel and financial components shows that the government controls universities in many respects, denies them the right to issue diplomas and grant qualifications and allows only limited institutional and academic freedoms. Ukraine is the only EaP country that lacks modern legisla­tion on education. A new bill on Higher Educa­tion is currently being debated. At the same time, Ukraine is doing better in terms of the National Qualifications Framework. In April 2012 the Ministry of Education and Sciences of Ukraine approved the implementation plan for the Na­tional Qualification Framework for 2012-2015. In November 2012 a similar Regulation on Educa­tional Qualification was adopted in Armenia.

No EaP partner has made progress in providing better opportunities for foreign, including EU, students to study in the EaP countries. The ma­jority of foreign students still come from neigh­bouring post-soviet countries and Central Asia.

All EaP countries have similar scores assessing policies in culture, youth, information society, media and audio-visual use. More specifically, Ukraine, Moldova and Armenia are the most progressive in cultural policy, although Ukraine initiated reforms and monitoring through the Cultural Policy Review later than other EaP countries.

The youth policy scores take into account the existence of legislation, national youth reports and legal provisions for volunteering and youth work. All EaP countries are making progress in developing new strategies and laws, e.g. on volunteering. There are strong debates on the provision of youth work and informal education in Armenia. Until 2009, there were only frag­mentary provisions for youth policy in Georgia when the development of a National Youth Policy started. The new law was adopted and came into force in 2012.

Georgia adopted its legislation on cultural policy relatively recently and opened the debate on improving the youth policy. Moldova still has no comprehensive youth report — only numerous fragmented studies on youth. There has been progress though in preparing a new law on youth. Moldova and Ukraine adopted laws on volun­teering. Civil society in Belarus has advocated a number of amendments to the law on volunteer­ing, yet the authorities have so far been reluctant to improve the legislation.