BYE-BYE, BALKANS: A REGION IN CRITICAL DEMOGRAPHIC DECLINE

Former communist countries in Southeast Europe face catastrophic depopulation, with far-reaching social and political consequences.

TIM JUDAH |BIRN | BELGRADE, CHISINAU, CLUJ, PODGORICA, SARAJEVO, TIRANA, ZAGREB

Young people are leaving. Fertility rates have collapsed. Societies are ageing. And though hundreds of thousands of refugees and migrants have tramped through much of the region, few want to stay.

Borders, ethnic spats, EU accession, NA TO membership and unfinished business from the wars of the 1990s — these are the sto ries that fill the news from the Balkans.

But serious analysis of the region’s demo graphic decline, depopulation and the hollowing out of the labour force is harder to find. Possibly this is because governments have nei ther credible answers nor the resources available to change things.

If demography is destiny, the Balkan future is bleak — but it is not unique. From Greece to Poland, almost all Eastern, Central and South east European countries are wrestling with the same problems.

On current projections, by 2050, Bulgaria will have 38.6 per cent fewer people than it did in 1990. Serbia will have 23.8 per cent fewer, Croatia 22.4 per cent and Romania 30.1 per cent.

Moldova has already lost 33.9 per cent of its population. Bosnia and Herzegovina has a fertility rate of 1.26, one of the lowest in the world. Kosovo, with a median age of 29, is the youngest country in the region but does not escape demographic decline either.

The figures and percentages may vary but the trends are the same almost everywhere, albeit with some countries further advanced than others. Serbia’s median age is 43, older than the EU average of 42.6.

However you look at it, the demographic future of the Balkans and this half of Europe, afflicted by emigration and chronic low birth rates, is dramatic.

Different from the past Historically, all countries of the region, and in fact most of Europe, had periods of intense emigration.

In the case of the former Yugoslavia, hun dreds of thousands went abroad from the 1960s as gastarbeiters, not necessarily mean ing to stay away but many of whom did, perhaps because they had children abroad or the wars or both.

Before that, Jews left — or were killed in the Holocaust — and ethnic Germans were expelled or killed. In the generation before that, Muslims, Albanians and Turks from Bosnia and other parts of former Yugoslavia and the wider Balkans left in various waves during the 19th and 20th Centuries.

People from the Dalmatian islands and parts of Montenegro went to the United States. Greece, Turkey and Bulgaria ex changed populations.

But in terms of numbers, this did not mat ter so much when women were having five or seven children. Emigration, in peacetime at least, both eased the pressure on land and re sources and populations continued to increase.

That is one of the reasons why what is hap pening today is so different from the past.

Then, Balkan countries exhibited the clas sic demographic and emigration characterisInfographic. Source:BIRN.

tics of poor countries. Today they exhibit the symptoms of both rich and poor countries si multaneously. This is unprecedented.

People in the Balkans live long lives — not quite as long as in the richer countries of Eu -

rope, but much longer than in poorer coun tries.

At the same time, just as in the richer coun tries, fertility rates have collapsed.

But while Western countries compensate for falling birth rates and emigration with im migration, relatively few people immigrate to Balkan countries.

In Central and Eastern Europe, only Po land has managed to significantly compensate large-scale emigration and low birth rates with the fortuitous immigration of more than a mil lion Ukrainians who have, at the same time, considerably blunted what would otherwise be critical labour shortages. Governments helpless All governments are well aware of the sit uation but struggle to know what to do about it, or lack the means to do much.

In Croatia, young couples can get govern ment-subsidised mortgages but you have to have enough money to put down in the first place and the numbers of mortgages available and couples eligible are tiny compared with the scale of the problem.

Where they can, countries give allowances to women and families with more children but there is no evidence, at least yet, that any of this can persuade them to have more children. In much wealthier Poland, which has giv en considerable fiscal advantages to lower income families, the money has both helped them and made them staunch supporters of the ruling Law and Justice party, but they don’t seem to be having more kids.

When it comes to emigration, short of re verting to old communist-style travel restrictions, it also seems that there is little that can be done, except in targeted fields such as pay ing healthcare workers a lot more.

Money, however, is not the only reason that people leave.

In the past, those whose eyes were not fo cused on moving abroad migrated from vil

lage to town and town to capital. The difference between the Europe of the past and today is that now it is easier to skip that phase than at any time in history.

In fact, the Balkans and other former com munist countries have themselves become the villages. If you come from rural Bulgaria or small-town Poland, why would you go to little Sofia or dreary Wroclaw if you can go direct ly to London or Berlin?

There is a whole wide world out there. No visas are needed for most Europeans for most Western countries and cheap airlines mean you can zoom back and forth from Austria or Italy in the way that a previous generation would have done by bus within their own country.

Secondary airports like Stansted or Beau vais now play the same role as bus stations serving distant provinces did in the past. Labour crisis Meanwhile, demography and emigration are leading to labour shortages everywhere. Governments have a real problem. Migra tion hugely mitigates the issues and expense of unemployment and brings in remittances. But it is also hollowing out the labour force, meaning that foreign investment is discour aged or, in some cases, even leaving.

Logically, the answer to labour shortages is to increase wages, but that is not happening, or at least not across the board.

In the former Yugoslavia, bus companies do not have the cash to compete with the wag es of German firms that need drivers. That is the same in Belgrade as it is in Rijeka in Cro atia.

Where the work is relatively uncomplicat ed and predicated on low wages, such as in the automotive parts industry in Moldova, it is cheaper for companies to move elsewhere than pay more.

That is not happening everywhere, of course, and some companies are upping sala

Governments have a real problem. Migration hugely mitigates the issues and expense of unemployment and brings in remittances. But it is also hollowing out the labour force, meaning that foreign investment is discouraged or, in some cases, even leaving. Logically, the answer to labour shortages is to increase wages, but that is not happening, or at least not across the board.

ries and retaining workers, especially in the most highly skilled sectors such as information technology.

Their higher wages may not compete with London or California, but the cost of living is so much lower that for many, if not all, it makes it worthwhile to stay.

Still, elsewhere it is not happening or eco nomic structures makes it hard to compete. In Croatia, the dominance of seasonal tour ism is hugely distorting.

In the past, it was always possible to find enough people from poorer parts of Croatia or the wider region to fill in for three months on the coast, but now they are increasingly re luctant to do so if they can work for the whole year or even half of it for a lot more money and with far better conditions in Germany.

In July, the Croatian government bowed to pressure from desperate employers to grant more work permits to foreigners. Romania is doing the same.

One way to solve the problem of a declin ing workforce is through immigration. That is what Poland has done by opening the doors to Ukrainians and increasingly to people from elsewhere too.

Others will have to follow if they want to keep their economies growing, but in coun tries with no tradition of immigration, that is going to be a tough sell.

One small plus, which has been noticed in Romania at least, is that previously marginal ised Roma are getting jobs that they would have been excluded from in the past. Money from those abroad is also helping create a Ro ma middle class for the first time.

If Poland is anything to go by, governments that succumb to the logic of immigration are going to have to walk political tightropes.

Poland’s government claims it is against immigration and refused to accept a few thou sand refugees when asked to by the EU in the wake of the migrant and refugee crisis of 2015. At the same time, it has quietly let in large numbers of (albeit white and Christian) Ukrai nians.

This type of politics may be a prototype for others to follow, but it could also be, at least for the Balkans, difficult to replicate. Where is the Balkan Ukraine?

Rural areas may be emptying everywhere but some places are growing.

Tirana, claims ErionVeliaj, its mayor, is growing by 25,000 a year while the country as a whole is losing people.

Cluj in Transylvania is a boom town, to which people from other parts of Romania and abroad flock to. Its success is based on the knowledge economy and IT.

There are examples in Romania where for eign investment, resulting in the building of modern factories, has arrested depopulation and even brought about some limited return. If cities like Cluj could be replicated a thou sand times and work done everywhere to improve living standards, as in Tirana, the situation would be very different. Exacerbated by the EU Uncomfortable though it is to acknowl edge, EU membership makes things worse, at least to begin with. But now the distinction in Europe between members and non-members is eroding.

For Poland, Romania, Croatia and others, opening the labour market led to millions leav ing. Now Germany and others have been opening up to skilled labour from non-EU countries too.

A few years ago, the issue was illegal mi gration and people trying their luck as bogus asylum seekers. That is the story of the past. Now there are jams of people in front of consulates from Belgrade to Banja Luka and Pristina as people seek work permits, often sponsored by companies in EU Croatia and Slovenia.

Migration leads to political consequences. Across the region, the demographic issue is becoming a political issue and not just in terms of governments promising to do something. In Serbia, the president has been contrast ing the current numbers of Serbs and Albanians with future ones that show Serbs dramatically diminishing in proportion to Albanians. He is doing this because he seeks to build a consensus before any unpopular deal he might make with Kosovo.

Electoral rolls everywhere remain packed with those who have emigrated. Politicians have an interest in doing this, and it is easier to steal elections if you have padded lists.

But the 2018 referendum in North Mace donia on the name change failed, not just because of an opposition boycott, but also because the threshold could not easily be reached because so many people on the roll were abroad. In June 2019, as one government was toppled and another took power in Moldova, one of its very first acts was to reverse a rule enacted for the last election that those in the diaspora could not vote with expired Moldo van passports or IDs.

Why was that important? Because a large number of the supporters of Maia Sandu, the incoming Prime Minister, are in the diaspora in the West and travel and work there on Ro manian passports and so have a higher rate than they would otherwise of expired Moldo van documents.

In Albania, the opposition attacks the gov ernment, claiming that up to half a million people have left the country in recent years. It is fantasy politics though, because hundreds of thousands have also come back or are circu lar migrants who come and go.

Migration also has effects in destination countries and it has helped fuel the rise of na tional-populist parties.

There is no way to quantify to what extent the arrival of large numbers of Poles, Roma nians, Bulgarians and so on tipped the balance in Britain’s 2016 Brexit referendum, but there can be no doubt that it played a role. Lost cause? How can countries solve these issues? Or is it a lost cause? These are the big questions of our time and sometimes governments may feel they are like people trying to run up a down escalator.

Why do people migrate? It is not only mon ey. It is education, healthcare and services too — and increasingly it is because people have lost hope that they will ever live in normal, democratic and as uncorrupted societies as possible.

By the time countries get richer, large seg ments of the population have already lived abroad and want the same standards of life, including social services, as they have experi enced in those Western countries.

“For my father’s generation,” says Majlin da, a 25-year-old Albanian student who has studied in Holland, “things have changed very fast, but that is not fast enough for me!”

So the expectations gap has increased as with no other generation in the past.

Logically you might think that if these coun tries are the villages of today, then fiscal transfers in a more federal Europe might be the answer, but we know that in the present climate that is not going to happen.

Indeed, the Western Balkan countries, let alone Moldova, are not even in the EU and some have begun to doubt they ever will be. But what is the evidence from the one part of the former communist world which solved the problem of fiscal transfers? It is not en couraging. Eastern Germany continues to depopulate almost three decades after reunification.

To slow and hopefully reverse the de cline, governments need to make countries that people want to live in. That is not rock et science, but maybe it is too late.

Countries cannot dwindle to nothing but they can just become old and that means re maining poorer than Western countries and that in turn means more emigration.

If they had been very rich to start with, like Japan, there would be more opportuni ty to do something, but since they are not, and since the trends are unrelentingly gloomy, this is a subject that needs urgent attention.

It needs action and ideas, not just from governments and thinkers in the countries whose populations are shrinking, but across Europe before the imbalance of what is hap pening becomes yet another issue threatening our liberal democratic foundations.