Europe is a continent located in the Northern Hemisphere and mostly in the Eastern Hemisphere. The continent is the world’s second-smallest continent spanning over 3.93 million square miles (10.18 square kilometers) and is comprised of 44 countries and additional states that are considered to be transcontinental. Europe is home to over 740 million people.
Some countries in Europe have strong economies, such as that of Germany, which has the fourth-largest economy in the world. Other countries, however, are not as wealthy or prosperous.
World War I and World War II significantly damaged the European economy. Following World War II, central and eastern European states came under the control of the Soviet Union, forming the Council for Mutual Economic Assistance (COMECON). During this time, western European states came together to form the European Union (EU), linking and strengthening their economies.
COMECON countries were struggling financially after the war and their situations worsened following the collapse of the Soviet Union. Although the COMECON countries gradually joined the European Union, many still face high levels of poverty.
Below are the poorest countries in Europe based on GDP per capita. GDP per capita is often considered an indicator of the standard of living in a given country since it reflects the average wealth of each resident.
Moldova is the poorest country in Europe with a per capita GDP of $1,679. Moldova was once part of the USSR. Following the Soviet’s collapse in 1991. Moldova faced instability, trade obstacles, economic decline, and other hardships. The country’s transition to a market economy was a major factor in its economic collapse. Moldova’s lack of large-scale industrialization, food insecurity, and errors in social policy are other contributors to the country’s poverty. Luckily, Moldova is making significant progress in decreasing its poverty levels.
With a per capita GDP of $2,133, Ukraine is the second-poorest country in Europe. Ukraine was the second-largest economy in the USSR but had difficulty transitioning into a market economy after the USSR collapsed. This sent much of the population into poverty. The country’s corrupt government and weak infrastructure have contributed to Ukraine’s continuing poverty, as well as Russian aggression against Ukraine, specifically Russia’s illegal seizure of Crimea in 2014.
Serbia is Europe’s third-poorest country. Serbia’s per capita GDP is $4,383, more than double that of Ukraine’s. About 25% of Serbians are impoverished. While Serbia made economic progress for eight years starting in 2000, the global recession in 2008 caused negative growth rates in Serbia and increased the country’s debt to 63.8% of its GDP. Natural disasters have further hindered economic progress.
Belarus has a per capita GDP of $5,017. Like other former Soviet republics, Belarus faced economic hardship following the disintegration of the USSR. Before the disintegration, Belarus had one of the strongest economies among Soviet republics and had a relatively high standard of living. Belarus’s economy began recovering around 1996, but the global recession hindered any progress the country was making.
Macedonia is Europe’s fifth-poorest country with a per capita GDP of $5,158. About one-third of Macedonian citizens live in poverty. Unemployment is one large contributing factor of poverty in the country, with the unemployment rate sitting above 21%. Political and ethnic tensions are also factors in Macedonia’s widespread poverty, as corruption and prejudice prevent the stability necessary for economic improvement.
Montenegro’s per capita GDP of $6,964, making it the sixth-poorest country in Europe. The average national poverty rate is about 8.6%. The country has about 50,000 internally displaced persons and refugees that are among the poorest in the country rate with a poverty rateof about six times higher than the national rate. Montenegro’s economy is small and reliant upon energy industries; however, urban expansion and deforestations have put the country at risk of resource depletion.
Bulgaria has a per capita GDP of $7,662. Bulgaria’s economy was destabilized by an attempt to establish a democratic government and a free-market economy following the collapse of the Soviet Union. About 41% of Bulgarians are at risk of falling below the poverty line and 10% live in extreme poverty. Like several other countries, Bulgaria’s economic progress following the USSR disintegration was taken down by the 2008 global financial crisis.
Russia is the eighth-poorest country in Europe. Russia’s per capita GDP is $8,538. Immediately following the collapse of the Soviet Union, Russia’s poverty rate was 35%, a rate that has decreased to just over 13%. In the decade following the collapse, Russia’s output decreased by 45%. As an oligarchic nation, wealth inequality is extremely high in Russia, which has more than 70 billionaires. Additionally, the Russian currency, the ruble, has declined in value by 50% in the past ten or so years.
Romania’s per capita GDP is $9,704. Romania joined the EU following the disintegration of the USSR and over 70% of the country’s exports to the EU. While Romania is becoming more technologically advanced, its population is declining. The population decline is mainly caused by negative net migration, where millions of people, mostly skilled and of the prime working-age, are leaving Romania to go find better work opportunities in other European countries. The lower levels of productivity negatively impact the Romanian economy.
Finishing the list of the ten poorest European countries is Poland, which has a per capita GDP of $12,456. Poland’s transition from communist to capitalist created a sharp increase in the country’s inequality. Despite Poland’s rapid economic growth post-USSR, wages remained low across Poland. Those working in low-skilled jobs and working-class families faced these low wages and the threat of automation on their jobs in the future.