The new Central Europe

Central Europe is arguably one of the great success stories of post-1989 Europe – and yet, the past 15 years of economic convergence embedded in European integration and NATO membership have not paradoxically produced the political and societal stability one might have expected. The region’s economic growth and well-being of citizens, especially when overcoming the 2008-09 economic crisis, continued to steadily grow. This is also true of life expectancy and general prosperity in the region. Central Europe, especially if we focus on the Visegrad Four, continued to benefit from its membership in the EU and NATO. These organizations delivered stability, prosperity and above all security that their neighbours to the east, primarily Ukraine, could only envy.

Yet despite these successes, all four countries have experienced considerable social disillusionment, polarization and societal fragmentation. In turn, these trends have contributed to political revanchism, a backlash against the EU, and the growth of anti-system tendencies. In some cases, they have even encouraged closer relations with the Kremlin or, to a lesser extent, the Chinese Communist Party. This raises an important question: what went wrong, and what lessons can be drawn for the future? The question is particularly striking given the relative prosperity these countries have achieved, even as that prosperity is increasingly threatened by Russia’s aggressive imperialism as part of its war against Ukraine and wider confrontation with the West.

Central Europe – here and now

Similar to the past 15 years, the state of Central Europe today offers a mixed bag of good and bad practices. On the one hand, there is Poland and Hungary – once black sheep of the European polity – now offering examples of re-democratization, democratic participation and the restoration of societal institutions, even if obviously not without flaws. On the other, there is Czechia and Slovakia, which are experiencing a steep downward trend of illiberal thinking. This shift is undermining institutions and fuelling chaos, polarization and division in these societies.

It is interesting to observe that over the past two decades, the patterns of the two groups largely shifted but rarely became the same. This issue stems from different societal patterns and dynamics typical of each of the V4 neighbours. But eventually, in many respects, the Central European countries became a standard part of the larger European community that suffers from similar phenomena. For example, similarities can be seen regarding the rise of anti-establishment tendencies or even far-right parties in Germany, France, the UK or Italy.

The Central Europe of 2026 no longer poses any substantial danger to the future of the European project, which was once associated with the Viktor Orbán regime in Hungary, and to some degree also Jarosław Kaczyński’s Poland. Andrej Babiš and Robert Fico are by far not the same heavyweights as the former leaders of Poland and Hungary. Budapest and Warsaw’s previous tendency towards pragmatic accommodation with the EU became a typical feature of their behaviour in the Union, largely in order to preserve access to EU funding crucial for public investment.

At the same time, the current divisions and disagreements among the four countries make it difficult to view their cooperation as a coherent political bloc capable of reaching common positions on the most important issues facing the EU today. The brief period after September 2015, when the Visegrad countries were able to oppose the EU’s so-called migrant relocation quotas, is now a distant memory. Poland’s subsequent departure from this common position further weakened the image of Visegrad as a regional “power bloc”, and a return to such unity appears unlikely. There have nevertheless been attempts to recreate this pattern of cooperation on EU regulatory issues. These have included opposition to ETS2 (the EU’s second Emissions Trading System that extends carbon pricing to fuels used in road transport and buildings) and to the phase-out of the internal combustion engine. The second issue is a particularly sensitive one given the key role of the automotive industry in Central Europe’s industrial economy.

On other major issues, such as the future of European integration, the ongoing negotiations related to the EU’s future budget, security and relations with Russia, and particularly preparedness for Moscow’s potential aggression against the Eastern Flank, Poland has more in common with the Nordic-Baltic countries. Czechia is more aligned with Denmark or the Netherlands when it comes to public spending and the EU’s multi-annual financial framework. While it remains to be seen in which direction Hungary under Péter Magyar is going, the Slovak government seems to be completely isolated in most European policy areas. Yet, the V4 becoming a “normal” part of Europe is not the whole story.

What has been lost (and found) along the way

While some of Central Europe’s achievements have already been noted, there are also more concerning trends. These include persistent inequality, growing divergence among the four countries, economic slowdown and a lack of innovation. The region’s older economic model, built largely on cheap labour and foreign capital and investment, is increasingly reaching its limits. It will need to be complemented by stronger domestic demand, home-grown innovation and new sources of growth. Managing this transition is likely to be one of the major challenges facing the V4 in the years ahead.

The group also possesses differences based on the relative position of the four countries. Poland stands out among the V4 partners given its geographic size and economic influence. According to the OECD, Poland’s economy has doubled over the past two decades and grown much faster than the other three. This also applies to the domestic landscape. Urban and rural differences have increased and the countries have often experienced negative dynamics and out-migration from peripheral parts to others offering more opportunities and growth. In general, the economic transformation’s winners and losers came to the forefront, leaving substantial parts of the population behind without options and access to resources that are available to the middle and middle-upper class. This is most visible at the level of housing or energy, as well as access to education that determines future career options.

These unhealthy dynamics often result in the political radicalization of substantial parts of the electorate living on the edge of economic deprivation. It is above all this group’s representatives that have created a powerful voting bloc of around 30 per cent of society who vote in Czechia for Andrej Babiš, in Poland for Law and Justice (and further to the right), in Slovakia for Fico and other extreme forces, and in Hungary for Fidesz. However, this part of the electorate in Hungary has now partially moved to support Magyar’s new government.

In Czechia but also in Slovakia and Hungary, this phenomenon is closely connected to the concentration of enormous wealth in the hands of the few. The Economist illustrated this in the Crony Capitalism Index 2023 by placing Czechia second after Russia. This is illustrative of how much inequality has grown over the past decades. Little effort has been made to pursue redistribution and share dividends with the less privileged. Part of the reason for this is, indeed, a legacy of the 1990s, with wild privatization of the state’s properties and enterprises. However, another reason is nepotism, clientelism and the establishment of networks of beneficiaries during the economic transition under a weak state.

The economic impact and creation of political revanchism against the “old elite” is best illustrated by the example of the Czech Prime Minister Andrej Babiš. His ANO 2011 party, standing for the “Association of Dissatisfied Votes”, grew in popularity with its appeal for economic benefit for all and fighting corruption and nepotism. Babiš ironically benefitted from the privatization of the 1990s and access to lucrative state enterprises belonging to the former communist government. He is now the seventh wealthiest Czech with a myriad of companies in the agricultural, food industry, and chemical sectors. He has now parked his wealth in a blind trust in order to be officially able to become prime minister.

We could observe a similar pattern also in Hungary and to a lesser degree in Slovakia, where the personal wealth of key political actors has been determining the political decisions of the whole country and too often hijacking the political agenda. Despite this, the example of Poland shows that the “game” can also focus on access to state enterprises and control over key institutions. Examples of this can be seen regarding the former public broadcaster TVP or the energy giant PKN Orlen blatantly manipulating the prices of fuels before the last parliamentary elections.

Nevertheless, many successes have been achieved and new confidence built, especially when compared with the 1990s and early 2000s. The Central European countries were mostly in the position of policy takers, rather than makers, at this time. This position was particularly related to the EU enlargement and reform implementation.

Central Europe now stands at a crossroads. The coming years will show whether the economic, social and political capital accumulated over the past decades can be translated into greater resilience and further development. There are already some encouraging signs. Parts of the business community are showing greater commitment to corporate social responsibility, good governance and the rule of law. New media initiatives have emerged alongside growing public support for quality journalism and investigative reporting. Russia’s aggression has also contributed to greater appreciation for the benefits of the EU and NATO. Taken together, these developments suggest that Central European societies retain a capacity to respond constructively to the multiple challenges they face.

Changing region?

However, Central Europe keeps changing and more up and down changes might be coming soon, especially concerning the upcoming parliamentary elections in Slovakia and Poland. These votes might determine the future course of events in both countries and the whole region for years to come. In this context, Czechia can serve as a stark warning where not to go. This is particularly true in a situation where there is a profound need for effective and forward-looking leadership and preparedness for future crises, be that in security, climate or connected issues such as migration and societal cohesion in Europe.

For the future of Central Europe, it might be also relevant to have another look at its future composition. Right now, there are calls coming from Hungary to expand and extend coordination within Central Europe to Austria. This shift would return cooperation to its historical roots, which are associated with the Habsburgian vision of Central European cooperation across the Danube region, which possibly also includes other regional partners as well. On another note, Ukraine has already articulated its interest in becoming part of Central Europe. Kyiv also wishes to pursue integration as a means of emphasizing its differences with Russia and even Belarus, two aggressive regimes attacking European security.

The question of the future composition of Central Europe is important since it is closely connected with the future of the EU and its enlargement policy. Central Europe might still have a role to be played in the further expansion and enlargement of the EU to both the Western Balkans and Eastern Europe alike, where these countries can potentially play a positive role. There is a leadership vacuum in many respects, which could be easily filled by the experienced and now fully transformed EU members in Central Europe. This is despite the presence of the area’s current dynamics and difficult cross-border relations right now.

Another profound challenge for the region and its societies is going to be related to the next steps within the economic transformation from the old economic model to the one built around innovation, science and technology. Digitalization and artificial intelligence will also play key roles in this shift. Poland and Czechia – for example – do not have a bad starting position, with the development of the EU’s so-called AI gigafactories serving as hubs for future development in this area. Despite this, it is crucial to consider how these developments can benefit the whole of society and not only the few. The correct approach to this issue will help avoid a future societal backlash.

Finding a vision

Political choices will remain crucial in shaping good governance, the rule of law and the investment climate. The same applies to education, human capital, start-ups and the development of practical solutions to emerging challenges. Some countries, particularly Poland, may benefit from a process of re-democratization that offers an opportunity to strengthen institutions and make them more resilient against future attempts to dismantle the liberal democratic order. Hungary may eventually face a similar opportunity.

Slovakia and, more recently, Czechia appear to be moving in a different direction. Political discourse has increasingly turned inwards, with governments portraying parts of independent civil society, the media and other institutions as internal adversaries. Resisting these pressures and ensuring that governments remain accountable, including at the EU level, will be essential. This will determine whether Central Europe can remain a meaningful political space and a source of inspiration for countries to the EU’s east and south.

At the same time, this now firmly established part of Europe will need to articulate more clearly its own vision for the continent’s future. What does Central Europe expect from Brussels, and what responsibilities is it prepared to assume at the European level? The negotiations over the EU’s future budget will provide an important test. They will reveal how much the member states are prepared to work together and how closely integrated they want the Union to remain. Such questions will only become more pressing as Europe confronts Russian imperialism, China’s increasingly assertive trade policies, and a United States whose commitment to the existing global order has become less predictable.

The question, then, is no longer whether Central Europe belongs to Europe. It clearly does. The more important question is what kind of Europe does the region want to help build – and whether it can overcome the domestic problems and regional fragmentation that threaten its ability to do so.

 

Pavel Havlíček is an AMO research fellow. His research focus is on Eastern Europe, especially Ukraine and Russia, and the Eastern Partnership. He also deals with questions of security, disinformation and strategic communication, as well as democratization and civil society support in the CEE and post-Soviet space.