What is the current extent and composition of multidimensional poverty? A closer look at four EU countries: Romania, Bulgaria, Poland, and Croatia

**Currently, one in five people living in the European Union is at risk of poverty or social exclusion, and in some countries, such as Bulgaria and Romania, this proportion is considerably higher.** In 2022, Romania and Bulgaria experienced the highest AROPE rates (34.4 and 32.2 percent, respectively) in the region, whereas rates in Croatia (19.9 percent) and Poland (15.9 percent) were below the European average (21.6 percent). Across the EU, countries' disparities are not negligible; for example, multidimensional poverty in Romania nearly triples Czechia’s rate.<sup>41</sup>

**Bulgaria and Romania exhibit some of the highest levels of relative income poverty within the EU. Additionally, a considerable segment of the population in these countries faces risks that go beyond mere monetary deprivation.** In recent years, the AROPE rate in Bulgaria and Romania has been more than nine percentage points higher than the AROP rate, reflecting the critical role of nonmonetary dimensions in poverty and their importance to general well-being **.** In 2021, Bulgaria's AROPE rate was 31.7 percent, significantly higher than its AROP rate of 22.2 percent. Similarly, Romania's was 34.5 percent, compared to an AROP rate of 22.5 percent. In 2022, these large differences persist. Bulgaria's AROPE rate slightly increases to 32.2 percent, while its AROP rate also rises to 22.9 percent. Romania sees a comparable pattern, with a large difference between the AROPE rate and the AROP (34.4 percent vs 21.2 percent). These updated figures reaffirm the persistent gaps between the two poverty indicators in these countries and highlight the importance of policies that not only target the income poor but also work in tandem to address the nonmonetary aspects of poverty.

**Conversely, Croatia and Poland exhibit smaller differences between their AROPE and AROP**

**rates.** In 2021, Croatia's AROPE rate stood at 20.9 percent, slightly higher than its AROP rate of 19.2 percent. Similarly, Poland's AROPE rate was 16.8 percent in 2021, with an AROP rate of 14.8 percent.  In 2022, similar small gaps are observed in both countries.  Given the high correlation between these two indicators, policies targeting the income poor may also reach a high share of those deprived in non-monetary aspects in these countries.

**To design effective policy interventions, it is crucial to understand the extent of monetary and non-monetary deprivation among individuals but also the severity of their deprivations, which entails understanding both the number and intensity of the deprivations they experience.** Table 3 presents our estimates of the incidence of overlapping deprivations, including low work intensity, severe social and material deprivation, and income poverty indicators for the four EU countries in 2022. This joint distribution analysis allows us to identify the mismatches and overlaps between the measures.

**In Romania and Bulgaria, not only is the extent of monetary and non-monetary deprivations higher, but so is the intensity of deprivations.** On average, about one-third of multidimensionally poor individuals are deprived in more than one dimension, but there exist heterogeneities across countries (Table 3). In Bulgaria and Romania, 29.9 percent and 31.2

> 41 Source: Eurostat, 2024

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