The circular economy (CE) is not a goal in itself, but a tool to achieve the decoupling of economic growth from resource consumption. It is not achieved in one step; it represents a long-term and continuous process in which production and consumption models, as well as society, continue to evolve. In order to monitor the implementation and development of the circular economy, there are indicators that provide insight into the level of circularity of countries for a specific period. This research aims to continuously monitor the level of circular economy development using Eurostat indicators in the areas of competitiveness and innovation, with a focus on European Union (EU) countries, for the analyzed time period 2018-2020. The goal of the research is a comparative analysis of the level of circular economy (CE) development in the analyzed countries for a specific time period by identifying key 294 ”Challenges of Digitalization in the Green Economy” Belgrade, October 30th, 2025 trends in the areas of competitiveness and innovation since competitiveness is crucial for a country’s development and is closely linked to innovation. Based on the analysis, it was determined that some countries are in an advanced stage of the circular economy, while others are in the early stages. Implementing CE is essential to address the increasing pressure on resources while maintaining economic growth.