Countries Most Worried About the Future

24/7 Wall St.

War, economic crisis, poverty, disease and overpopulation threaten the well-being of people all over the planet, and yet most people are confident that their lives will be better in five years time. That is according to a survey of 147 countries conducted by Gallup in 2011. In every country, a majority of people believed their lives would be as good or better in five years. In the United States, only 15% thought their lives would be worse in five years, though that’s relatively pessimistic compared to the other countries surveyed.

Despite this general optimism, pessimism had a much stronger pull in several places. In 11 countries — most of them in Europe — at least 25% of the population believed their lives would get worse. While several are surprising, some others make a great deal of sense. The most obvious of these is Greece, in which 42% of the surveyed population was pessimistic. Based on Gallup’s survey, 24/7 Wall St. examined the 11 most pessimistic countries in the world.

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Gallup’s survey was not a measure of whether people think their lives will be unsatisfactory. If that was the case, war-ravaged countries and places with extreme poverty, disease and famine would top the list. Instead, the majority of these pessimistic countries are relatively safe and wealthy. Nine of the 11 are classified as the most developed by the United Nations Development Programme’s Human Development Index.

Citizens of the most pessimistic countries believe their lives are going to get worse. This may be due to the moribund economies brought on by the global recession and the European sovereign debt crisis. A review of the economic trends in these countries reveals that they have deteriorated more rapidly than the rest of the world in the past few years. Between 2010 and 2011, GDP declines in these countries were more severe than in most of the rest of the world. Six were among the 15 countries with the highest measured GDP declines during that time.

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If appears that one of the factors that most strongly generates pessimism is unemployment. In all but two of the 11 countries, unemployment was higher in 2011 than it was in 2009, when the global recession was arguably at its worst. What’s more, relative to the rest of the world, unemployment in these countries has gotten worse. For example, in the Czech Republic, which is among the most pessimistic, unemployment has increased from the 61st highest in 2009 to 53rd highest in 2011.In that same time, Greece moved from an estimated 30th highest to ninth.

Gallup conducted a separate poll in 2011 on how each nation’s residents felt about their labor market. The results, released today, mirror national unemployment rates and indicate that most residents know how hard it is to find a job in their country.

In eight of the eleven countries on our list, the number of people who believed it was a bad time to find a job outnumbered the people who thought it was a good time four to one. In Greece, also on our list, just 2% of those surveyed thought it was a good time to find a job (the smallest proportion in the world.)

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24/7 Wall St. reviewed Gallup’s report “Worldwide, Greeks Most Pessimistic About Their Lives” to identify the counties with the highest rates of pessimism. This report, published on July 25, 2012, was based on a survey of roughly 1,000 individuals in each of 147 countries. Respondents used a 0 to 10 scale to indicate how they felt about their lives now and five years into the future, with those individuals providing a future rating below their present one labeled as pessimistic. 24/7 Wall St. relied on the International Monetary Fund’s (IMF) World Economic Outlook for most the economic statistics cited, including gross domestic product, GDP per capita, public debt as a percentage of GDP and unemployment. (Some of these IMF figures are estimates.) Sovereign credit ratings come from Moody’s Investors Service, and are scored on a scale of Aaa (best) to C (closest to default).

These are the 11 most pessimistic countries in the world.

11. Mauritius > Pct. pessimistic: 25% > Moody’s sovereign credit rating: Baa1 > Life expectancy: 73.4 years > Unemployment (2011): 7.79%

The Mauritian economy has slowed down in recent years, and GDP growth has fallen from 5.5% in 2008 to an estimated 4.1% in 2011. Slowing growth has been accompanied by increasing inflation, which rose to an estimated 6.54% in 2011 from just 2.9% in 2010. Not all news on the Mauritian economy is poor. In June, Moody’s Investors Service raised Mauritius’ credit r ating from Baa2 to Baa1, citing increased economic diversification — achieved through a growing service sector — and reduced exposure to shocks originating from Europe.

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10. Malta > Pct. pessimistic: 25% > Moody’s sovereign credit rating: A3 > Life expectancy: 79.6 years > Unemployment (2011): 6.4%

A quarter of Maltese surveyed by Gallup were pessimistic about the future. Despite economic growth, decreasing unemployment and other indicators of a healthy economy, the country’s imports have outweighed exports for the past five years. Public debt is increasing as a result of deficit spending.By the end of 2012, Malta’s debt will be 67.9% of GDP.

9. Cyprus > Pct. pessimistic: 25% > Moody’s sovereign credit rating: Ba3 > Life expectancy: 79.6 years > Unemployment (2011): 7.78%

The pessimism expressed by Cypriots may be largely tied to economic woes. The small island nation is highly exposed to the Greek economic crisis, and its two largest banks are among Europe’s largest holders of Greek debt. Cyprus’ economy has struggled in recent years: GDP fell by 1.86% in 2009. Growth remained slow through 2011, when GDP rose just 0.5% according to IMF estimates, one of the slowest growth rates in the world that year. The unemployment rate increased from 3.65% in 2008 to an estimated 7.78% in 2011, making Cyprus one of three nations on this list whose unemployment rate doubled in the previous two years. On June 27, 2012, the IMF’s managing director, Christine Lagarde, announced that Cyprus had requested financial support from both the IMF and the European Financial Stability Facility, the eurozone’s financial safeguard, citing exposure to the Greek economy.

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8. Singapore > Pct. pessimistic: 26% > Moody’s sovereign credit rating: Aaa > Life expectancy: 81.1 years > Unemployment (2011): 2.00%

Singapore has the second highest import/export trade as a percentage of GDP — over 280% — making the country one of the most business-oriented in the world, according to the World Trade Organization (WTO). With unemployment never more than 3% during the recession and consistently rising GDP per capita, it is hard to see why many Singaporeans were feeling pessimistic about their future in 2011. The Singapore dollar weakened by 5.5% in 2011, which may have led to the increase in inflation, possibly causing some lack of economic confidence among those surveyed. Lee Kuan Yew, who had led the country since independence and helped it become an economic powerhouse, stepped down from his cabinet post in May 2011.

7. Hungary > Pct. pessimistic: 28% > Moody’s sovereign credit rating: Ba1 > Life expectancy: 74.4 years > Unemployment (2011): 10.95%

In 2008, unable to pay its sovereign debt, Hungary received $25 billion in assistance from the IMF, World Bank and European Union. In 2009, Hungary’s GDP contracted by 6.8% — one of the largest economic contractions in the world that year. In recent years, GDP has improved only slightly, rising by 1.70% in 2011, while inflation has slowed only marginally from 4.21% in 2009 to 3.9% in 2011. On July 26, the IMF announced that it had entered into discussions with Hungary to create another economic assistance platform, noting the country’s indebtedness and slowing growth.

6. Japan > Pct. pessimistic: 30% > Moody’s sovereign credit rating: Aa3 > Life expectancy: 83.4 years > Unemployment (2011): 4.55%

Japan was deeply effected by the March 2011 earthquake, which led to the disaster at the Fukushima Daiichi nuclear plant. Even without this catastrophe, Japan faces significant long-running economic issues, such as significant government debt, deflation and an aging population. In 2011, Japan’s net government debt reached an estimated 126.6% of GDP — the third-highest rate in the world. Another source of concern has been deflation. Japan’s average consumer prices were lower in 2011 than in 2001, making it the only country that did not experience inflation over the decade. Meanwhile, Japan has had six prime ministers in the past six years.

5. Slovenia > Pct. pessimistic: 30% > Moody’s sovereign credit rating: A2 > Life expectancy: 79.3 years > Unemployment (2011): 8.08%

In 2011, Slovenia’s credit rating was downgraded twice in three months by Moody’s to A1. Unemployment has also been steadily increasing since the start of the recession, reaching more than 8% in 2011. As with other pessimistic countries in the European Union, the economic crisis appears to be the leading cause of a lack of confidence in the future. According to a poll conducted by Ipsos in 2011, more than half of Slovenians felt that the economy was in “very bad” shape, and a third believed the country would get weaker within the next six months.

4. Portugal > Pct. pessimistic: 32% > Moody’s sovereign credit rating: Ba3 > Life expectancy: 79.5 years > Unemployment (2011): 12.74%

For years, Portugal enjoyed an abundance of cheap credit. But without much fiscal control, its debt grew to more than 100% of its GDP in 2011. Portugal asked the EU for a bailout in April 2011 to escape its massive debt. In May 2011, the parties agreed on a $115 billion bailout over three years as officials worried about the consequences of austerity measures. Unemployment steadily increased and reached 12.7% in 2011. NPR interviewed Luis Pais Antunes, former lawmaker and economist, who blames economic mismanagement for the debt, saying the economy has had little growth in the past decade while the government continued to finance infrastructure. Lastly, Prime Minister Sócrates resigned after parliament rejected his austerity plan in March 2011. All these economic and political developments likely led to the pessimism many Portuguese feel about their future.

3. Syria > Pct. pessimistic: 33% > Moody’s sovereign credit rating: N/A > Life expectancy: 75.9 years > Unemployment : 8.61% (2010-most recently available)

Unlike other countries on this list, Syria’s pessimism is rooted in the violent conflicts currently gripping the nation. In the past year, Syrians have had little reason to be optimistic, as the government’s response to popular protests that began in March 2011 has been exceptionally violent. As the conflict has evolved, military defectors have formed the “Free Syrian Army” to oppose the government of Bashar Al Assad. Among the atrocities committed by the government have been the use of troops and heavy weapons in densely populated areas. According to the Associated Press, in July the Red Cross announced that the Syrian conflict had become a civil war, citing increases in violence in the country.

2. Czech Republic > Pct. pessimistic: 33% > Moody’s sovereign credit rating: A1 > Life expectancy: 77.7 years > Unemployment (2011): 6.70%

Despite its location in the heart of Europe, the Czech Republic’s economy has remained relatively stable, but debt became a pressing issue by the end of 2011. The Ministry of Finance reported a dim fiscal outlook in November 2011, citing the spread of the debt crisis to eurozone countries and weakening demand for Czech exports. As a result, the country’s central bank maintained a benchmark rate of 0.75%, a record low, to buoy the economy.

1. Greece > Pct. pessimistic: 42% > Moody’s sovereign credit rating: C > Life expectancy: 79.9 years > Unemployment (2011): 17.31%

Greeks citizens are more pessimistic about the future than residents of any other nation and for good reason. Much of this pessimism is grounded in the country’s recent economic deterioration. In early 2010, reflecting mounting international concerns over the country’s massive government debt, Standard & Poor’s downgraded Greece’s debt to junk status. In May 2010, eurozone countries and the IMF agreed to a 110 billion euro bailout to prevent Greece from defaulting on its debt. Greece’s output fell by 3.5% in 2010, followed by an even larger decline of 6.86% the next year. In 2011, Greece’s net sovereign debt rose to an estimated 350 billion euros, or 160.8% of GDP — a higher percentage than any other country. That same year, the eurozone and IMF agreed to a second bailout of 130 billion euros, which was implemented in 2012.