In the new enlargement approach, the Fundamentals cluster is the alpha and omega: it opens first, closes last, and effectively determines how fast everything else can move. This cluster covers functioning democratic institutions, rule of law, and fundamental rights – and many decent people have already expressed their opinions on what is going on in Ukraine in that context. Therefore, I suggest digging straight into the economic criteria, which rest on two questions: does Ukraine have a functioning market economyand can it cope with competitive pressure inside the EU? These two benchmarks make up the economic side of the Copenhagen criteria and indicate whether an economy can operate smoothly in the Single Market.
The intrigue is real, since there are no strict quantitative criteria, and the Commission has a lot of discretion in its judgement. The grading relies on an ordinal scale – early stage, some level of preparation, moderate preparation, good preparation, and well-advanced – to signal how far a country has moved toward meeting the criteria of accession. Progress is measured by whether a country moves up this scale over time, based on annual assessments of reforms, implementation, and alignment with the EU acquis.
In the first Enlargement Report of 2023the criterion existence of a functioning market economy was assessed as being between an early stage and some level of preparation. The Commission mostly appreciated the fact that Ukrainian economy, well… existed and functioned. Prior to the Russian aggression outbreak, Ukraine had already accumulated a range of structural problems, including (but not limited to) a high degree of state involvement in the economy, inefficient labour markets, labour shortage, and low private investment rate. Fiscal and monetary outlooks looked somewhat better, but there was no realistic way for them to get a good score given the scale of war-related spending and damage. Ukraine was advised to improve the business climate, stay on the macro-stabilisation path, and address structural unemployment and informal employment. The criterion on Ukraine’s capacity to cope with competitive pressure and market forces within the EU was rated at an early stage of preparation. The grade was constrained by war-related destruction, chronic underinvestment, weak infrastructure, skills mismatches, and a pre-war economic structure dominated by low value-added sectors. Commission, therefore, recommended faster infrastructure rehabilitation, better investment conditions, and stronger education and training systems.
The 2024 assessment showed no change in Ukraine’s stage of preparation, and some/limited progress was achieved. For both economic criteria, key recommendations stayed almost identical.
And we finally reach 2025when some improvements occurred. Ukraine is now rated at some level of preparation on the functioning market economy and between an early stage and some level of preparation on its capacity to cope with competitive pressure, reflecting good progress compared with last year. Underinvestment, weak infrastructure, labour-market distortions and skills mismatches persist. Reflecting this, the Commission once again urges Ukraine to stay on the macro-stabilisation path, deepen SOE and business-environment reforms, and continue strengthening infrastructure, investment conditions and education (sounds familiar, doesn’t it?).
Unlike in previous years, the report explicitly acknowledges Ukraine’s solid macro-financial management, the gradual withdrawal of wartime measures, and progress in tax administration and deregulation. As a Ukrainian, I welcome this. As a Ukrainian economist, I am slightly puzzled. From my perspective, Ukraine’s economy has held up remarkably well during the war, but I have not noticed any meaningful acceleration or major improvement in economic reforms compared with last year.
My first guess is that the Commission’s upgrade in 2025 reflects less a sudden reform breakthrough and more a correction of how Ukraine’s wartime economy is perceived. What initially looked like inertia left over from peacetime appears to be genuine economic resilience after more than three years of a full-scale war. I am not great with metaphors, but here’s one: my Volvo may not be brand-new, eco-friendly, or light on fuel, but it is big, reliable, and keeps going through blackouts without complaint. (Meanwhile, to all the Tesla owners in Ukraine: how are you holding up these days?)
But there might be another reason: Brussels is gradually adjusting its own benchmark, recognising that its pre-war reference points no longer capture the new reality. It would certainly feel nice to believe that EU leaders have finally internalised the geopolitical landscape. Given the threat of Russian aggression, nothing is more important than being strong, competitive, and strategically autonomous – at the very least, not dependent on Russian fuels. Naturally, this objective comes with costs, and it seems that EU leaders are beginning to acknowledge them. The shift in the EU’s economic governance (away from rigid prudential rules and toward recognising the role of investment in resilience) points in the same direction. Perhaps I am being too hopeful – buy hey, a girl can dream, can’t she?
Anyways, the update on the economic criteria is a positive signal, although one should perceive it with cautious optimism. Back in the 2000s, Bulgaria and Romania managed to join the EU even though they lagged behind the EU average in income, macro-fundamentals, institutional quality, and other core criteria. For the first time in its history, the EU placed new member states under a special post-accession monitoring mechanism – the Cooperation and Verification Mechanism (CVM) – to track their progress on judicial and anti-corruption reforms. Introduced at accession in 2007, it was fully lifted only in 2023. And despite only partially fulfilled Copenhagen criteria, for geopolitical and credibility reasons – anchoring south-eastern Europe in the EU/NATO and honouring earlier accession commitments – admitting Bulgaria and Romania was extremely timely (Ukrainians would say “na czasi”, and I cannot find a better translation for this idiom).
So, even though Ukraine might not be fully ready for the EU, let’s stay optimistic and hope that EU is getting ready for admitting Ukraine.
