Demography and Flexibility: The Two Vital Issues for the European Union

In recent years EU has faced a number of problems: “sanctions war” with Russia, migration crisis, Brexit, terrorism, growing euroscepticism and populism. The aim of the paper is to draw attention to a potentially overlooked fundamental reason for these problems: Europe’s demography. Research methods used include application of economic theory, analysis of EU official documents, statistical data and publications on European demography, author’s own calculations. We find that territorial extension of EU has been driven by need for markets and resources, especially labor. The findings indicate that now EU has to concentrate upon internal problems, pointing out natural increase in population as one of the crucial ones. Unless Europe regains ability to rely upon its own human resources, the problem of maintaining European national and cultural identity has no solution. The study also finds that the EU regional policy should be more efficiently used to reduce territorial disparities within the Union in order to slow down depopulation of poorer member states.