Candidate countries remain significantly distant from European Union averages in terms of GDP per capita and their demographic and labor market characteristics. This analysis examines selected income, demographic, and labor market indicators for nine actual and potential candidates for European Union membership. The group includes the six Western Balkan countries and three EU Eastern Partnership countries. The aim is to gauge how far these countries are from the EU average on key indicators and to assess whether and to what extent the gap has narrowed since 2003, when the EU Thessaloniki Summit offered potential EU accession to Western Balkan countries. Additionally, differences between candidates are compared with the three newest EU member states: Bulgaria, Romania, and Croatia.
Despite sharing a post-communist legacy, EU candidate countries are not homogeneous. They emerged from distinct historical and economic systems: the Soviet Union, communist Yugoslavia, and isolated Albania. These backgrounds have shaped their economic structures and integration paths, with the post-Yugoslav states and Albania receiving EU accession offers two decades before Ukraine, Moldova, and Georgia. Today, renewed momentum for enlargement is driven not only by long-term convergence goals but also by geopolitical considerations following Russia’s invasion of Ukraine.
Candidate countries have made progress in GDP per capita convergence since 2003, although starting from a low level. In 2024, Montenegro and Serbia recorded the highest GDPs per capita, roughly half the EU average, followed by Georgia at 45 percent and North Macedonia at 44 percent. Moldova, Kosovo, and Ukraine had the lowest levels, at 29 percent, 30 percent, and 31 percent of the EU average, respectively. Between 2003 and 2024, Georgia progressed most rapidly, followed by Serbia, Albania, and North Macedonia. Kosovo and Moldova saw moderate progress, while Bosnia and Herzegovina and Ukraine experienced slower convergence. Ukraine stands out as a special case, having experienced three de-convergence periods due to global and domestic crises, including the full-scale Russian aggression.
The more rapid GDP per capita convergence of Western Balkan countries compared to the Eastern Partnership countries can be attributed to earlier EU integration processes, geopolitical circumstances, and better business climates. These factors resulted in larger inflows of foreign direct investment and increased trade with the EU. The rapid GDP per capita convergence of the three newest EU countries suggests that EU integration plays a positive role in growth acceleration. Between 2003 and 2024, the gaps between Bulgaria, Romania, and the Western Balkan countries increased significantly.
Significant population declines have occurred in all candidate countries except for Montenegro, which has benefited from incoming migration. Between 2003 and 2023, Bosnia and Herzegovina’s population declined by 24 percent, Ukraine by 22 percent, Moldova by 16 percent, Serbia by 12 percent, Albania and North Macedonia by 10 percent each, Georgia by 6 percent, and Kosovo by 4 percent. The newest EU countries have seen similar trends, with Bulgaria losing 18 percent, Romania 12 percent, and Croatia 11 percent of their populations.
Depopulation is driven by declining fertility rates, limited progress in increasing life expectancy, and net outward migration. Fertility rates in the analyzed countries have been converging to the EU level, below the replacement level of 2.1 births per woman. Some countries, such as Kosovo, Georgia, and Albania, experienced delayed fertility rate declines compared to the EU. In 2023, the highest fertility rates among EU candidates were in Georgia (1.81), Montenegro (1.74), and Moldova (1.73). Ukraine’s fertility rate below 1 in 2022-2023 is attributable to the ongoing war. Interestingly, fertility rates in the newest EU countries either improved or stabilized, reflecting limited fertility rebounds during and after EU accession.
Female life expectancy at birth has improved in most candidate countries but remains below the EU average of about 84 years. In 2023, it ranged from approximately 75 years in Moldova to 81 years in Albania and Kosovo. Bulgaria, Croatia, and Romania have seen trends similar to their Western Balkan neighbors. Male life expectancy at birth has shown even more dramatic gaps, particularly in Georgia, Moldova, and Ukraine, suggesting poor quality healthcare services and unhealthy lifestyles. Croatia’s male life expectancy is within the range recorded by Western Balkan countries, while Bulgaria and Romania’s are closer to post-Soviet countries.
Labor force participation (LFP) rates have generally increased in EU candidate countries, partly compensating for shrinking working-age populations. Female LFP has risen in most analyzed countries, with Moldova and Albania recording the most visible gains. However, in Bosnia and Herzegovina, Montenegro, and North Macedonia, female LFP remains below 55 percent, well below the EU average of 70 percent. Historically, female LFP rates were higher in the former Soviet Union than in the former Yugoslavia, and even higher than in the EU. These differences have partly diminished over time. Bulgaria has converged to the EU average, while the female LFP rate in Croatia in 2024 was only slightly higher than in Serbia. Romania’s rate was 57 percent in 2024, with slow growth from 2003.
Male LFP rates have been higher, typically above 70 percent to 75 percent, but have plateaued or declined in some countries, particularly Georgia and Ukraine. In Bulgaria and Romania, these rates have converged towards the EU average level. The gender gap in participation is still 15 to 20 percentage points in most candidate countries, compared to 9.5 percentage points in the EU in 2024. Declining working-age populations have helped mitigate high unemployment, especially in the Western Balkans. Although unemployment rates in candidate countries (except Moldova) in 2024 were still higher than the EU average and the three comparator EU countries, there was significant improvement compared to the situation a decade or two earlier. North Macedonia, Serbia, and Bosnia and Herzegovina have seen substantial reductions in their total unemployment rates.
Youth unemployment remains the most entrenched challenge. In 2024, rates exceeded 25 percent in most Western Balkan countries, roughly 10 percentage points above the EU average, and higher than in Bulgaria, Croatia, and Romania. While long-term improvements are visible, the pace of convergence is slow, and youth joblessness remains a major source of economic and social vulnerability.
The economic convergence of EU candidates with the EU average, measured by GDP per capita in constant prices and 2021 PPP international dollars, has progressed since 2003, partly due to declining populations in candidate countries. However, the substantial income gap between the candidates and the EU remains. The candidate country with the highest GDP per capita, Montenegro, reached only half of the EU average in 2024. GDP per capita convergence could have been more rapid had the EU enlargement process moved faster. The performances of Bulgaria, Romania, and Croatia, as well as countries that became EU members in 2004, support this hypothesis. Full access to the European single market and the EU budget, and institutional harmonization resulting from the adoption of the EU acquis and other reforms, accelerated the growth paths of new EU members. The three Eastern Partnership countries have been even more disadvantaged because they concluded association and free trade agreements with the EU a decade later, and received membership offers two decades later, than the Western Balkan candidates. The ongoing Russian aggression has handicapped not only Ukraine but also neighboring Moldova.
Demographic and labor market indicators determine potential growth. All candidate countries except for Montenegro have experienced depopulation caused by negative natural population growth and net emigration. A declining working-age population has helped mitigate historically high unemployment in the former Yugoslavia, although youth unemployment remains a challenge. Gradually increasing labor market participation rates have helped mitigate declining working-age populations and population aging. There are differences in demographic and labor market indicators between the former Soviet Union and former Yugoslavia, dating back to the communist era. For example, female LFP rates are higher and unemployment lower in post-Soviet candidate countries, but so are their male life expectancies.
