In the newly released 2025 Human Development Report by the United Nations Development Programme (UNDP), the Nordic countries once again top the Human Development Index (HDI), reaffirming their global leadership in education, health, and income standards. According to the report, Iceland ranks first worldwide, followed closely by Norway in second place. Switzerland and Denmark hold the third and fourth spots respectively, with Sweden and Finland also placed among the top 10 nations globally.
Nordic countries lead the world in quality of life
The HDI is a composite index measuring key dimensions of human development: life expectancy, education (mean and expected years of schooling), and gross national income per capita. All Nordic countries not only perform well on these core indicators but also show low levels of inequality, strong social safety nets, and robust democratic institutions.
In more detail:
- Iceland (HDI 0.972) leads the world, with an average life expectancy of 82.7 years, expected schooling of 18.9 years, and a GNI per capita of USD 69,117. It also boasts the lowest gender inequality index and near-universal access to secondary education.
- Norway (HDI 0.970) combines a very high GNI per capita (USD 112,710), a life expectancy of 83.3 years, and strong educational outcomes. It has one of the highest levels of income equality and among the best scores on inequality-adjusted HDI.
- Denmark (HDI 0.962) is a leader in both environmental sustainability and welfare provision. It reports an expected schooling of 18.7 years, low adolescent birth rates, and an exceptional gender balance in political representation.
- Sweden (HDI 0.959) stands out for its education system, with the highest expected years of schooling in the Nordic region (19.0). It also has high female labor force participation and strong performance on the planetary pressure–adjusted HDI.
- Finland (HDI 0.948) maintains excellent results in gender equality, with women holding 46% of parliamentary seats, and performs strongly in health and education indicators.
Together, these countries exemplify the Nordic model, blending economic prosperity with social equity and sustainability.
Baltic countries show steady improvement
While not yet at the level of their Nordic neighbours, the Baltic states have demonstrated strong upward trends in human development. Estonia, in particular, ranks highest among them, with a solid HDI performance driven by investments in digital infrastructure and education.
Lithuania and Latvia also remain within the high human development category, showing improvements in life expectancy and economic indicators. The UNDP report highlights how digital governance, healthcare reform, and EU funding have played key roles in boosting development across the Baltics.
EU countries show growing disparities
Within the European Union, the Human Development Report paints a more nuanced picture. Although most EU countries fall under the very high human development bracket, the report notes a widening gap between Western and Eastern member states.
Countries like Germany, France, and the Netherlands continue to perform well, but several Eastern European nations lag behind due to lower income levels, shorter life expectancy, and uneven access to education. Greece, Bulgaria, and Romania are among the EU members with relatively lower HDI scores, although they still show gradual progress.
The report warns that inequality within and among countries is rising, a trend exacerbated by global crises and the uneven adoption of new technologies.
The promise and risks of AI for human development
One of the key themes of the 2025 report is the potential of artificial intelligence (AI) to transform human development. The UNDP suggests that AI, if implemented ethically and inclusively, can accelerate progress in healthcare, education, and economic productivity. However, the report also cautions that AI could deepen global inequalities if access and benefits remain concentrated in wealthier countries.
For high-performing countries like the Nordics, AI represents an opportunity to further enhance public services and innovation. For lower-income nations, building the infrastructure and skills base to participate in the AI-driven economy remains a significant challenge.
