Expat Essentials

New for 2019: Dispatches’ list of Europe’s five best developing countries for expats

(Editor’s note: In multiple capacities, Dispatches staffers work daily with expats – friends and colleagues – from developing countries including Bosnia, Macedonia, Bulgaria, Romania and others. Their experiences and outlooks helped shaped this post. Also, due to a typo, the original version of this post stated that Slovakia was part of Yugoslavia. That error has  been corrected.)

In almost three years, we’ve done multiple best-cities and best-countries lists, and the core premise has always been, “Where can expats get the most bang for their buck/euro in terms of career opportunities, quality of life and cost of living?”

You fortunate few who have 8-figure Swiss bank balances and are most worried about making sure you can get your Ferrari serviced – you can skip this one.

We’re going to rank the countries in a region we don’t traditionally think of as an expat destination – emerging Europe. Basically, we’re talking about all the countries east of Austria to the Russian border. The countries that used to be under the Communist yoke and are only now building strong and sophisticated economies … basically countries in the Balkans.

Why? Because unless you’re a highly skilled international taking a job in the semiconductor industry or are a top engineer or finance person, the high functioning societies of western and northern Europe can be wildly expensive and – we hate to say it – a bit predictable.

So this is for the ramblers and gamblers looking for a bit of risk and adventure outside their comfort zones.

Several developing countries such as Poland and Romania are among Europe’s fastest-growing economies while still losing significant number of citizens to more developed countries such as Germany, countries with higher wages and less corruption.

Which brings us to the major complication here: corruption. Many, if not all, the countries on our list have corruption hard-wired into their societies. All were vassal states of the old Soviet Union and have been democracies for – in some cases – 30 years or less. In our experience, in the Balkans and Middle East, corruption is a cancer that eats away at the fiber of a society until it collapses. (See Iraq, Afghanistan and pretty much any country in West Africa.)

Unlike western and northern Europe, most of these countries have few English speakers, which makes things more challenging for our audience, English-speaking internationals. Finally, most countries in the Balkans have climates with hot summers and cold, snowy winters.

But for those hardy expats who can learn the game, then win the game, we can see the potential to bring order to the chaos, creating great jobs for locals while making lots and lots of money.

Because as we always say, it’s better to be at the start of something than the end.

Methodology

For this list, we queried our expat network and looked at statistics kept by non-governmental agencies and academics.

We grade each country on:

• Housing (cost and availability)

• Corruption (preferably, lack of)

• Cost of living

• GDP growth

• Education

• U.S. News and World Report country ranking

No. 5 ROMANIA

We went back and forth on this and consulted our Romanian friends. Yes, this is a very flawed country with a lot of corruption, inefficiency and political instability. But you could say that about Italy, which is the 8th-largest economy in the world.

Where others see intractable problems, we see potential. Why? Because Romania is a European Union supporter, taking over the rotating presidency for 2019. More importantly, Cluj already has a flourishing tech sector, and you can’t say that about any other former Iron Curtain country outside the Baltics. What makes Romania worth a bet – albeit a long-shot – is that it has an incredibly varied economy, one which has generated an average 4-percent GDP growth since 2015.

(For comparison, the economy of the United Kingdom is projected to grow about about 1.7-percent for 2019. If they’re lucky.) By some measure, Romania has the 9th-largest economy in the EU ranked by GDP based on purchasing power standards, according to Eurostat data consulted by Business Review. That is, the amount of money flowing through the economy has pushed up purchasing power faster than prices.

Politically, things could go either way. Romania’s corruption under de facto leader Liviu Dragnea appears to be getting worse despite the fact anti-corruption forces have been in the streets for a solid year. Never a dull moment.

The details:

• Housing – Housing in Bucharest is 70 percent of the cost of housing in our benchmark city of Amsterdam, according to Expatistan. We see no signs of a housing shortage.

• Corruption – Romania is ranked No. 59 on Transparency International’s corruption index, right there with Cuba and tied with Greece. BUT, it is ranked higher than Montenegro.

• Cost of living – A decent one-bedroom apartment in a nice section of Bucharest with about 85m2 of space will run you about 2,000 Romania leu, or 500 euros per month, according to Expatistan. Utilities run about 85 euros per month. Internet access, which is quite fast in cities, costs about 7 euros per month.

• GDP growth –  4 percent projected for 2018.

• Education – Romania, like most of the Balkans, gets low grades for its education system from Programme for International Student Assessment, or PISA. Romania ranks No. 46 on the latest PISA worldwide ranking. 

• U.S. News and World Report Ranking: No. 54. USN&WR gives Romania relatively high marks for being business-friendly.

Pluses: A strong tech sector

Minuses: A brewing showdown between liberal reformers and quasi-Communists and nationalists from Romania’s dark past.

No. 4 MONTENEGRO

This is a country you might never have heard of, but will in the future because it’s a destination for travelers (if not tourists). Montenegro, which fought a brief war with Serbia for independence, has been trying for 10 years to qualify for EU membership. Unlike the UK, about 66 percent of Montenegrans support joining. The euro is already the currency.

Montenegro just launched a program offering citizenship to up to 2,000 foreigners in return for investment over the next three years. That sounds like a minuscule number of people. But the entire population of Montenegro is 620,000, basically a suburb  of a large American city such as New York.

The investment-for-citizenship plan requires expats to donate 100,000 euros for development of poor communities, then invest either 250,000 euros into development projects in northern and central Montenegro or 450,000 euros into projects in the capital Podgorica.

Pro-European Union candidate Milo Đjukanović was elected president for a second term. Montenegro and Serbia are the only two countries in the region currently capable of full EU membership by 2025.

What do you get? One of the most beautiful and undiscovered countries in Europe with:

• Boka Bay, the southern-most fjord in Europe because it’s a super-deep river canyon that empties into the Adriatic. Boka Bay has its own micro-climes.

• Wilderness. Half the country is still covered in forests. Montenegro has the greatest bio-diversity in all of Europe.

• Valleys and views: Montenegro has some of the highest, most rugged mountains in Europe, averaging more than 2,100 meters (7,000 feet.)

The details:

• Housing (cost and availability) Housing is about 66 percent less than in Amsterdam, and we see no indication of housing shortages.

• Corruption – Montenegro is ranked 64th on Transparency International’s index, two spots above Hungary.

• Cost of living – A nice 1-bedroom apartment in an upscale section of Podgorica – population 150,000 – rents for about 500 euros per month. Utilities cost about 115 euros per month. Internet is 21 euros per month.

• GDP growth – up 4.3 percent for 2017.

• Education: Montenegro is ranked below Romania on the PISA worldwide ratings at No. 53.

• U.S. News and World Report Ranking: NR

Pluses – Natural beauty

Minuses – A little too close to Albania.

No. 3 SLOVAKIA

Pro golfer Rory Sabbatini was born in South Africa. But last month, he showed up in PGA records listed as a Slovak citizen. Okay, Sabbatini’s wife Martina Stofanikova, is from Slovakia. But the couple actually lives there part-time, which is some kind of endorsement. Roger Federer’s wife Mirka is Slovakian, but the tennis legend is still Swiss.

Still, we see a trend.

Seriously, there’s a growing and active community of entrepreneur expats, so this is Slovakia’s moment.

The economy is booming, with the main problem now finding talent. Jaguar/Landrover just opened a 1 billion euro-plus factory in Nitra, with an initial workforce of 1,500 people. GDP growth is projected to be about 4.3 percent for 2019.

Slovakia and its capital Bratislava get high marks as a hot new tourist destination, and this is, by all accounts, the highest-functioning society in the Balkans.

The details:

• Housing in Bratislava is about half of the cost of Amsterdam and there is a surplus of apartments.

• Corruption – Slovakia is ranked No. 54 on Transparency International’s corruption index, just above Croatia and tied with Italy.

• Cost of living –  A 85m2, 1-bedroom in Bratislava costs about 850 euros per month to rent. Utilities run about 100 euros per month, and an Internet connection is about 15 euros per month.

• GDP growth – 3.4 percent in 2017

• Education: Slovakia has a more highly rated education system than the majority of Balkan countries, ranked No. 42 on the PISA Top 80 ranking, just above Greece.

• U.S. News and World Report Ranking: NR

No. 2 CROATIA

Croatia’s appearances in HBO’s “Game of Thrones” series and its status as a stand-in for the Greek islands in the sequel to “Mamma Mia” have made it a popular tourist destination. Stunning beaches, clear blue water, and historic cities such as Dubrovnik draw millions of visitors annually.

While it is certainly a great place to visit, it’s an equally great place to live for some expats. If you’re planning on moving to Croatia to find a typical 9-to-5 job, you might have a difficult time. Croatian citizens are leaving the country to find economic opportunities elsewhere. The jobs simply aren’t there.

But if you’re a digital nomad or ready to retire, you’ll find everything you need here. English-speaking expats will have very little trouble communicating, housing is plentiful and inexpensive, and public WiFi is abundant.

Though the ground transportation system could be better organized, it’s easy to fly from major towns in Croatia to practically anywhere in Europe, and non-stop flights to the U.S. are on the horizon. You might miss some of the amenities you’d enjoy in more developed countries such as the UK or Germany. I, for instance, like to be near an Apple Store in case I have a technology meltdown, and I do miss Starbucks when I’m there, but there are modern malls and grocery stores for pretty much anything else you might need.

Co-working spaces are beginning to pop up here and there for location-independent workers who prefer not to work “at home.” I’ve spent half of the past two years along the Adriatic coast working as a travel/lifestyle writer and online English teacher and have enjoyed my three-month stints in Croatia enormously.

As I travel in and out of the Schengen Zone every 90 days instead of having a home base, I don’t have any personal experience with the process of becoming a long-term resident. I would imagine that any red tape you have to go through would be a fair trade-off for living the expat lifestyle in this up-and-coming EU country.

The details:

• Housing – Zagreb is about 60-percent cheaper than Amsterdam and there are no housing shortages.

• Corruption – Croatia is ranked No. 57 on Transparency International’s corruption index, one spot lower than Slovakia.

• Cost of living – An 85 m2, 1 bedroom in Zagreb rents for about 5,100 Croatian kuna, or about 700 euros per month, among the more expensive rent rates on this list.

Utilities cost about 100 euros per month, and throw in another 20 euros for Internet access.

• GDP growth is projected to be about 2.6 percent for 2018, the lowest on this list. Per-capita GDP is bout 20,000 euros.

• Education – Croatia has the second-highest rating for the Balkans from PISA at No. 36, just behind the Iceland and Luxembourg. (Luxembourg spends roughly 20 times more.)

• U.S. News and World Report Ranking: No. 50. The highest scores are for being business-friendly and an adventure destination.

Pluses: Probably the best travel infrastructure and an emerging expat-powered tech scene.

Minuses: Tourism, along with EDM festivals, are starting to overwhelm Croatia a bit.

– Beth Hoke reporting from Dubai

No. 1 SLOVENIA

Slovenia, an EU member and euro economy, is not on many people’s radar other than Donald Trump’s. But this is one of the most interesting, most educated and most beautiful countries in Europe.

In fact, Slovenia’s education system is ranked as No. 12 in the world and No. 4  in the EU only behind Finland, Estonia and the Netherlands according to a the most recent OECD rankings. So it’s not a shock that it’s a leader in robotics and even space exploration, with Slovenia announcing plans to launch its own satellites.

Like Croatia and Montenegro, Slovenia was once part of Yugoslavia. But the Slovaks kicked out Milosevic’s soldiers in 1990 and never looked back. Of all the former East Bloc countries, Slovenia probably doesn’t deserve to be on this list because it, like Poland, is in our opinions a developed country. It’s not Sweden, but it’s also not Bosnia, if you get our drift. It has very low levels of corruption and very high levels of education.

About 80 percent of Slovenia’s 2 million people (two million total … that’s not a misprint) live in urban areas, and the capital, Ljubljana – population 300,000 –  just instituted a ban on plastic bags.

The details:

Housing – Housing is about 47 percent cheaper in Ljubljana than Amsterdam, and we see no housing shortages.

Corruption – On Transparency’s internationals corruption Index, Slovenia is No. 34, ranked above Spain, Italy and Croatia.

GDP growth – Slovenia’s GDP per capita is about 30,000 euros, and GDP growth was 5 percent in 2017!

Cost of living – An 85m2 1-bedroom in Ljubljana’s nicer areas will run you about 950 euros, the most expensive city on this list. Utilities will be about 200 euros per month and an Internet connection is about 20 euros per month.

Education – Slovenia has one of the best educational systems in the world, according to PISA. It’s rated No. 11 in the world and No. 4 in the EU, only behind Estonia, Finland and the Republic of Ireland.

U.S. News and World Report has Slovenia at No. 53 on their list of the best countries with bonus points for quality of life, entrepreneurship and business-friendliness.

Pluses – If you like to ski, this is the place.

Minuses – There’s some sort of border dispute with Croatia. Who knew? We’re not sure either country has actual armed forces, but you never know.

From Chris Harrell in the U.S.:

Lived in Slovenia in 1999 and on and off for 7 years. A true gem. Shh, but don’t tell anyone (anymore).  I always seek to be living there again – if I could find valuable work to do.  Slovenes work hard, but they put life before work in a proper balance. 92-percent Catholic nation with a high regard for families and children. Slovenia has had historically great maternity leave arrangements.  When I was there women had government-mandated 2 years maternity leave with 80 percent of their salary. A small slice of heaven on earth IMHO. 

Honorable mention:

Poland – Poland has Europe’s fastest growing economy, but the politics have shifted far-right.

Serbia – Serbia is ranked below Burkina Faso on Transparency International’s corruption ratings. Which is bad. Very, very bad. Yet it’s a vibrant culture and fast-growing economy.

Bulgaria – A country with a long, long way to go in terms of political stability, but has great potential.

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