Greece Issues Baby Bonus to Boost Birth Rate

Greece’s center-right government lead by Prime Minister Kyriakos Misotak has struggled to counteract the country’s demographic decline. (Flickr)

Greece is now offering a bonus of 2000 euros ($2235) for families for the birth of each child in order to boost the country’s birth rate. The Greek prime minister, Kyriakos Mitsotak, promised to reverse the demographic decline, and he instituted the reward system beginning January 1.

The bonus will be paid in two parts: the first 1000 euros ($1117) paid immediately at birth and the remaining balance paid within the next six months. Non-Greek nationals will also be able to receive the bonus provided that they are EU citizens or non-EU families with the mother being a permanent and legal Greek resident since 2012. 

Experts predict that the Greek population of 10.7 million will shrink by a third in the next three decades. Additionally, more than 36 percent of its population will be over the age of 65 by 2050, compared to only 7 percent of the population in that age bracket in the 1970s. As the Greek economy is already in recession and its social system in strain, this trend is becoming worrisome for policy-makers and Athens’ center-right government. 

“People might think this is an issue of national pride but it’s actually one of national preservation,” said Domna Michailidou, former Cambridge University academic and deputy minister of labor and social affairs. 

Michailidou, who has always advocated for the baby bonus system in Greece, explains that reverse in Greek demographic is crucial for its economic recovery and future growth. “Given that high productivity rates are associated with young populations and not actively aging ones, it’s also an economic growth priority. The picture becomes even more gloomy when compared with the difficult state of our pensions system,” suggested Michailidou. 

Greece has faced a declining population for more than a decade. At the height of its financial crisis with more than 28 percent of the population unemployed, more than 500,000 people emigrated. Most of those who emigrated were highly educated, young professionals, causing a serious brain drain in Greece.

Furthermore, Greece’s health budget has been cut by 40 percent since the crisis. This has caused insecurity among women, especially those residing in less-developed mountain and island areas. For instance, the island of Fourni had zero birth in 2014 and 2015. Currently, there are 11 ongoing pregnancies on the island.  

Greek officials hope that immigrants and refugees from the Middle East, Asia, and Africa will also alleviate the present situation. 

“If the Greek government pursues an intelligent migration policy, the country can function as a demographic pump,” said Chandakas, a British-trained fertility expert. “It can both receive and integrate immigrants while sending Greeks abroad who in turn can strengthen the global Greek presence through diaspora communities. The brain drain is not a loss. These people will never lose their sense of Greek identity. In an age of networks, they can act as a bridge between Greece and the outside world.”