Europe is earning its moniker as the old world. Without immigration the bloc’s population would be shrinking. No country in the EU has a birth rate high enough to replace deaths. Croatia, the newest member, has made reversing population falls into a central plank of its current presidency of the EU. Many countries in eastern and southern Europe are now in decline, thanks to a combination of emigration and higher death rates than birth rates.
Some economists argue slower population growth can have deleterious effects: companies invest less for the future, older workers stockpile savings to fund their retirement, interest rates fall and growth stagnates. Many point to the ageing of western societies as a key explanation for low productivity growth and the decline in long term interest rates. The start of Japan’s malaise coincides with when its working-age population started to shrink.
Immigration is the easiest and most obvious way for Europe to increase the growth of its population. Yet few politicians, especially in the former communist states, would willingly argue for higher immigration from outside Europe. Many western European governments are unwilling to support any further eastward expansion of the EU’s single market; Emmanuel Macron, the French president, vetoed talks with Albania and North Macedonia partly over concerns about migration.