This paper, published in January 2025 by the European Investment Bank, the Vienna Institute for International Economic Studies, and the Austrian National Bank, examines the state of innovation and competitiveness in Central, Eastern, and South-Eastern European (CESEE) EU countries. It highlights that while these countries have increased their innovation capacity, significant challenges remain, including skills shortages and barriers to commercializing innovative ideas. The research notes the importance of foreign direct investment in driving innovation and productivity, particularly through greenfield investments. Ultimately, the paper recommends policy measures to improve the availability of skilled labor, secure risk capital, and enhance collaboration between academia and industry to support innovation-driven growth in the region.

#MEGA - Make Europe Great Again