Greece’s Ghost Towns: A Nation Grapples with Population Collapse
In the heart of Greece’s Peloponnese region, the abandoned village of Lasta stands as a poignant symbol of a larger crisis. A self-serve cafe, operating on an honor system, is the only visible sign of life in this once-thriving community. Lasta is not alone; hundreds of “ghost towns” across Greece bear silent witness to a dramatic population decline, a consequence of falling birth rates, economic hardship, and mass emigration. This demographic shift poses a significant threat to the nation’s economic future, prompting the government to implement ambitious yet potentially insufficient measures to reverse the trend.
Key Takeaways: Greece’s Shrinking Population
- Plummeting Birth Rates: Greece boasts one of Europe’s lowest fertility rates (1.3), far below the replacement rate of 2.1.
- Mass Emigration: The 2009 financial crisis triggered a wave of emigration, with an estimated 400,000 people—9% of the workforce—leaving the country.
- Ghost Towns: Hundreds of villages and towns have been abandoned, stark reminders of the population exodus and aging population.
- Government Intervention: The Greek government has pledged €20 billion ($21 billion) in incentives, including child benefits and tax breaks, to combat the declining population.
- Economic Implications: The shrinking population threatens to undermine Greece’s current economic growth by reducing the workforce and consumer base.
Falling Birth Rate: An ‘Existential’ Threat to Greece
Greece’s fertility rate, at a mere 1.3, is alarmingly low. This is half the rate recorded in 1950 and significantly below the 2.1 births per woman needed to maintain a stable population. In 2023, the country recorded just over 71,400 births—the lowest number in nearly a century—representing a 6% decrease from 2022. With around one birth for every two deaths, and a rapidly growing elderly population (the share of the population aged over 65 is nearly double that aged 0-14), Prime Minister Kyriakos Mitsotakis has declared the situation an “existential threat” to Greek society.
Uneven Impact Across the Country
The impact of population decline is not uniform across Greece. While some areas are more severely affected than others, the phenomenon is pervasive, particularly visible in the emergence of numerous ghost towns and villages. Estimates suggest that there are close to 200 completely abandoned settlements, many forgotten and crumbling, while others, like Lasta, are attracting a unique form of tourism, drawing visitors interested in exploring the remnants of a disappearing past. Even Lasta, with a reported population of 12 in the 2021 census, showed no signs of permanent residents during a 2024 visit by CNBC.
Remnants of the Greek Financial Crisis
The current demographic crisis is deeply intertwined with Greece’s 2009 sovereign debt crisis. The austerity measures imposed as part of the subsequent bailout programs devastated the Greek economy, leading to years of recession. Youth unemployment soared to a staggering 59.5% in the first quarter of 2013. This economic downturn had a devastating effect on young people who were unable to establish independent lives. Many emigrated, with estimates suggesting more than 400,000 people left the country during this period. Those who stayed often migrated to the large urban centers, mostly Athens and Thessaloniki, in search of opportunities. This has left many rural areas, including the country’s islands, facing population decline.
Long-Term Trends
The decline in birthrates, however, predates the 2009 crisis, tracing back to the 1980s—another period of economic instability. The resulting decline in the number of women in childbearing age now contributes to the ongoing crisis, with 150,000 fewer women aged 20-40 compared to five years ago.
Government Initiatives to Support Population Growth
The Greek government projects a population decline from around 10.4 million today to 7.5 million by 2050—a dramatic decrease of more than a quarter. In response, Prime Minister Mitsotakis established a new Ministry of Social Cohesion and Family Affairs to coordinate support for families and children. In October 2024, the ministry announced a massive €20 billion ($21 billion) investment through 2035. The funding is slated for initiatives designed to incentivize families to have more children including enhanced parental leave, significant child benefits, and tax incentives. Sofia Zacharaki, the minister, describes the plan as a crucial “shock” to the system, addressing not only economic concerns but also attempting to address a “mindset issue” among young people stemming from ongoing economic uncertainty.
Skepticism of Current Measures
Despite the government’s efforts, economists remain skeptical about the effectiveness of these initiatives. Bert Colijn, chief economist at ING, believes that simply providing child support might not be enough to reverse the trend, and that structural changes are needed to encourage young people to settle down in Greece and lure back those who have left. He also points to the lack of successful examples of similar policies in other countries.
Demographic Shifts Weigh on Economic Growth
Greece’s current economic outlook, with projected growth of 2.2% in 2024 and 2.3% in 2025, contrasts sharply with the long-term implications of its demographic decline. While the immediate economic picture appears positive, economists caution that the shrinking population poses a significant threat to sustainable long-term growth. The reduction in the workforce and shrinking consumer base directly impact both productivity and economic output.
Global Context
It’s crucial to understand that Greece is not alone in facing this challenge. Many developed nations are grappling with similar demographic trends. Japan and South Korea, with fertility rates of 1.2 and 0.72 respectively, serve as stark examples. This trend is not limited to Asia; much of the West, and even China, face similar problems of aging populations necessitating extensive governmental support. Jim Reid, Deutsche Bank’s global head of macro research, highlights the severity of the situation, stating that the world is experiencing an “unprecedented demographic transition” and that the implications could result in a decade of below-average growth for developed markets. The implications of this demographic decline extend far beyond national borders, making it a global concern requiring innovative and comprehensive solutions.
