Eastern Europe's Exodus

• Author: Maria Petrakis
• Position: Freelance journalist based in Athens, Greece.
• Pages: 26-27

24 FINANCE & DEVELOPMENT | March 2020

In Europe’s newest states, emigration compounds the problem of aging populations

Maria Petrakis

Eastern Europe’s

EXODUS

Chris Topalov’s family has navigated the

choppy waters of Europe’s embattled

economies for decades. His parents lef t

their homeland of Bulgaria to esc ape

f‌inancial chaos in 1997; chaos cau ght up with

them in Greece, where Chris wa s born. In 2016 the

family left for bet ter prospects in the United States.

e odyssey has prompted Chris to study ec o-

nomics to make some sense of Europe’s travails

when he heads to college this yea r. But though he

feels Bulgaria n, it’s an open question whether he

would ever move back.

at’s a problem for Bulgaria and the other, mostly

former socialist countries of central, eastern, and

southeastern Europe. Nine of the ten fastest-shri nking

countries in the world are in easter n Europe, accord-

ing to United Nations projections, with consequences

for economic growth and a chanc e at the European

prosperity that the fal l of the communism promised.

Life expecta ncy ha s risen to 74 years from 67 in

1995, and GDP per capita has more than doubled.

But longer lives, smaller fami lies, and the ease of

emigration have combined to exert demographic

pressures that wil l increasingly weigh on economic

growth, undermini ng the gains achieved since the

fall of the Berlin Wall. Countr ies in the region are at

risk of getting old before they get ric h, IMF Deputy

Managing Direc tor Tao Zhang warned las t year.

It is no surprise, then, that many from ea stern

European countries are seeking opportunities else-

where. Membership in the European Union has

made it easier to boost trade and foreign invest ment

and has brought with it an exce ptional pace of per

capita income convergence to western European

levels. But it has also kept up the pressure on t he

exodus of young, skilled professiona ls that began

with the fall of commun ism in 1989.

Between 1995 and 2017, central, eastern, and

southeastern European (CESEE) countries lost

about 7 percent of their workforce, mostly young

and educated workers, like Topalov’s parents. e

United Nations expects that the population of

the region will decline by 12 percent by 2050 as a

result of aging and mig ration. e workforce will

fall by a quarter in t he same period.

“Population aging concerns more than just public

pensions,” says Alasdair Scott, an IMF economist

who coauthored a recent study of demographics in