EBRD Report: Ageing Populations as 'Ticking Time Bomb' for Global GDP Growth

The European Bank for Reconstruction and Development (EBRD) has flagged ageing populations as a critical threat to global GDP growth in its latest semi-annual report [1]. For emerging Europe, the report projects a 0.4 percentage point annual reduction in per capita GDP growth (2024-2050) due to shrinking working-age populations [1]. A core concern is the region’s ‘getting old before rich’ challenge: median age 37 with GDP per capita of $10k—one-fourth of advanced economies’ level at the same median age [1].

Policy responses face political hurdles: migration is unpopular, AI adoption is ambivalent, and extending working lives requires pension reforms that are often resisted [1]. The report notes a global age gap between leaders (median 60) and median adult age (41), which may hinder long-term reform efforts [1].

1. Political Disconnect
   : The 19-year age gap between leaders and median adults suggests misaligned priorities, with younger voters underrepresented in decisions affecting their future [1].
2. Systemic Risk
   : Emerging Europe’s pay-as-you-go pension systems are vulnerable to demographic decline, relying on a shrinking workforce to fund retirees [1].
3. Fleeting Opportunity
   : Nigeria’s demographic dividend is temporary—falling African birth rates mean urgent policy action is needed to capitalize on its growing workforce [1].

• Growth Drag
  : Emerging Europe faces sustained lower GDP growth without reforms, straining social safety nets [1].
• Missed Dividend
  : Young nations like Nigeria risk squandering their advantage if job creation lags [1].
• Gridlock
  : Ageing populations/leaders may resist necessary reforms (pension adjustments, migration) [1].

• Extended Working Lives
  : Reforms to extend working lives could offset 70% of projected growth loss [1].
• AI Potential
  : AI adoption could boost productivity, though technology ambivalence remains [1].
• Nigeria’s Edge
  : Pro-growth policies could leverage Nigeria’s workforce to drive economic expansion [1].

The EBRD report emphasizes urgent action is needed to address demographic decline. Emerging Europe must focus on pension reforms and extended working lives, while Nigeria needs to capitalize on its demographic dividend before it fades. Inaction will lead to severe long-term economic consequences, though political challenges remain significant [1].