What the EU Prosperity Index actually says about life in Czechia

Czechia climbed two places in this year's EU Prosperity Index, reaching 14th, its best position since the ranking launched in 2022.

The economy is growing, healthcare is nearly universal, and the country leads the entire EU in cybersecurity. If you chose Czechia deliberately, this year's EU Prosperity Index offers some validation.

But it also offers some dim views of a country struggling to house its people and facing long-term questions about how it educates and cares for them.

The economy grew 2.6 percent last year, and relatively healthy public finances helped lift the ranking.

Healthcare remains one of Czechia's strongest cards, accessible to 99.5 percent of the population, a figure that compares favorably with most of Western Europe.

On cybersecurity, Czechia ranks first in the EU, the result of what the National Office for Cyber and Information Security describes as long-term systematic work connecting state, private sector, and academia.

The broader picture among the top performers show the five consistently strongest countries (Sweden, Denmark, Finland, Austria, and the Netherlands) share strong economies and high investment in education and research, but diverge on almost everything else.

But there seems to be no single model for prosperity. Sweden leads on environment; the Netherlands on labor markets and digitization.

Housing is where the index is most damning. Czechia ranks fifth worst in the entire EU on affordability, and the situation is worsening. The average apartment costs 13.6 annual salaries, among the highest ratios in the EU.

In Prague, the figure is starker: buying a new 70-square-metre flat now requires nearly 15.9 annual wages, up from 14.8 a year ago, according to the CG Index compiled by developer Central Group.

For anyone who relocated here partly on the assumption that Central Europe offers better value than western capitals, that comparison lands as a reality check.

The gap has been widening for a decade. New apartment prices in Prague have risen nearly 180 percent over ten years; wages have grown around 80 percent. It now costs almost six years' additional salary to buy a new apartment in the capital compared with 2016.

Central Group executive director Michaela Váňová is direct about the cause: the problem is not primarily wages, but the significant increase in real estate prices driven by constrained supply. Prague's planning and permitting system, notoriously slow even by European standards, has kept new development limited even as demand has held steady.

Ninety-two percent of Czechs say they want to own their home but cannot afford to.

Czechia has the 16th highest defense spending in the EU. Prime Minister Andrej Babiš has acknowledged the country will not meet NATO's two-percent-of-GDP commitment this year.

The prosperity index flags this not just as a geopolitical concern but as a structural weakness. Experts also warn of low public preparedness for crisis situations more broadly.

With the NATO summit in Ankara approaching in July and a live dispute between President Pavel and the government over who leads the Czech delegation, the defence question is unlikely to leave the headlines soon.

Two issues in the index deserve more attention than they typically receive. The first is digitisation: Czechia sits 21st in the EU despite improving five places, with the index specifically criticizing the absence of basic e-government functions.

Most comparable countries have long since implemented Pre-filled forms and digital administrative processes.

The second is healthcare's long-term sustainability. Czechia's system is widely accessible now, but the index calls it a "time bomb."

The average Czech lives in good health only until the age of 62, and experts warn that chronic diseases are being under-diagnosed in a model that is financially unsustainable over time.

Education is also flagged as underfunded, at 4.5 percent of GDP, with Czechs among the least likely in the EU to pursue retraining or qualifications beyond formal schooling.