This report does not constitute a rating action. Europe is entering a period of demographic transformation. In the EU, deaths have exceeded births every year since 2012, a trend that resulted in a natural population decline of about 1.35 million people in 2025. Nevertheless, strong net migration continues to support overall population growth. Eurostat, the EU's statistical office, projects the EU population will increase modestly to a peak of 453.3 million inhabitants in 2029. Beyond that, the EU is expected to enter a prolonged period of population decline, making migration an increasingly important driver of demographic stability. The growing importance of migration creates political risks; immigration has become an increasingly sensitive issue in many European countries and anti-immigration parties are
