safetyUpdated 2026-07-19

Political Stability and Your Retirement Abroad

Why political stability matters for retirees, and which countries score highest on long-term stability.

Political Stability and Your Retirement Abroad

Political stability is the retirement factor nobody talks about until it is gone. A country with a low cost of living, a friendly visa regime, and good weather can flip from welcoming to hostile in the course of one election. Retirement is by definition a multi-decade commitment: the country you move to at 65 needs to still be a place you want to live at 85.

This guide ranks the long-term stability of every country in the RetireSpots directory using the World Bank's Political Stability and Absence of Violence/Terrorism indicator and the Economist Intelligence Unit's Democracy Index, supplemented by governance and rule-of-law metrics.

Every score is sourced as of mid-2026. At RetireSpots, every number shows its source.

Why political stability matters for a retiree

Political instability affects a retiree in four ways:

1. Property rights. If you own a home, instability can result in the erosion of property rights, expropriation risk, or a collapse in the real estate market that traps your capital.

2. Currency. Political crises almost always cause currency devaluation. If your pension is in dollars and your living expenses are in the local currency, this can work in your favour (your dollars buy more). But if your assets are local (you bought a house, you hold local bank accounts), instability wipes out value.

3. Visa and residency. A change in government can bring a change in immigration policy. Countries have revoked retirement visa programs, raised income thresholds retroactively, or made renewal deliberately slow. Stability reduces the risk that the rules change under you.

4. Healthcare and infrastructure. During instability, public services degrade. Healthcare access is the most immediate concern for a retiree. If public hospitals go on strike or medical supply chains are disrupted, your health depends on private options and evacuation coverage.

How political stability is measured

We combine three sources:

World Bank Political Stability and Absence of Violence/Terrorism: A percentile rank across all countries, from 0 (least stable) to 100 (most stable). Covers the likelihood of political violence, government overthrow, and terrorism.
EIU Democracy Index: A 0-10 scale measuring electoral process, civil liberties, government functioning, political participation, and political culture.
Property Rights Index and Rule of Law: From the World Justice Project and Heritage Foundation, measuring the strength of property rights protection and the impartiality of the legal system.

No single metric captures everything. A country can be democratic (high EIU score) but have weak rule of law (low property rights protection). A country can be stable (high World Bank score) but authoritarian (low EIU score). Retirees care about the composite: stable enough that the rules do not change on you, with institutions strong enough to protect your rights.

The stability rankings

Rank	Country	World Bank Stability Percentile	EIU Democracy Index	Rule of Law (WJP rank)	Stability tier
1	New Zealand	98	9.61	7th	Exceptional
2	Switzerland	96	9.14	5th	Exceptional
3	Denmark	95	9.28	1st	Exceptional
4	Ireland	94	9.19	12th	Exceptional
5	Austria	93	8.28	8th	Exceptional
6	Netherlands	92	9.00	7th	Exceptional
7	Portugal	91	8.88	23rd	Exceptional
8	Canada	90	9.24	12th	Exceptional
9	Australia	89	8.85	14th	Exceptional
10	Germany	88	8.90	6th	Exceptional
11	Japan	87	8.40	15th	Exceptional
12	Uruguay	86	8.85	20th	High
13	Singapore	85	6.18 (flawed democracy)	16th	High
14	Spain	84	8.08	24th	High
15	UK	83	8.28	15th	High
16	France	82	8.07	21st	High
17	Chile	81	7.98	26th	High
18	Costa Rica	80	8.29	28th	High
19	Italy	79	7.85	32nd	High
20	Czech Republic	78	7.83	22nd	High
21	Greece	77	7.52	33rd	Moderate-High
22	Panama	75	7.18	48th	Moderate-High
23	Malaysia	74	7.30	51st	Moderate-High
24	Croatia	73	7.10	29th	Moderate-High
25	Poland	72	7.04	27th	Moderate-High
26	Argentina	60	6.85	60th	Moderate
27	Dominican Republic	58	6.50	67th	Moderate
28	Thailand	52	6.35	71st	Moderate
29	Georgia	50	6.20	49th	Moderate
30	Sri Lanka	48	6.10	66th	Moderate
31	Vietnam	46	2.80 (authoritarian)	72nd	Moderate (authoritarian stability)
32	Mexico	42	6.15	99th	Moderate-Low
33	Brazil	40	6.68	81st	Moderate-Low
34	India	38	7.04	79th	Moderate-Low
35	Philippines	36	6.56	97th	Moderate-Low
36	Peru	35	6.53	96th	Moderate-Low
37	Turkey	32	4.35 (hybrid regime)	105th	Moderate-Low
38	Colombia	30	6.35	89th	Moderate-Low
39	Nicaragua	28	2.35 (authoritarian)	121st	Low
40	Ecuador	26	5.80 (hybrid regime)	95th	Low
41	Cambodia	24	2.90 (authoritarian)	130th	Low
42	Egypt	22	2.80 (authoritarian)	130th	Low
43	South Africa	20	7.05 (flawed democracy, but low stability)	53rd	Low

Sources: World Bank Worldwide Governance Indicators 2024, Economist Intelligence Unit Democracy Index 2024, World Justice Project Rule of Law Index 2024.

The stability tiers

### Exceptional: no meaningful political risk

New Zealand, Switzerland, Denmark, Ireland, Austria, the Netherlands, Portugal, Canada, Australia, Germany, and Japan. These countries have democratic transitions of power that happen peacefully, property rights that are legally enforceable, and institutions that do not collapse when an unpopular government is elected. A retiree in Portugal or New Zealand does not need to think about political risk as a factor in their retirement.

Of these, Portugal (D7 visa) and Ireland (Stamp 0) are the only two with retirement-specific visa pathways. New Zealand, Canada, and Australia have no retirement visa. See the visa guide.

### High: stable, minor risks

Uruguay, Spain, France, Chile, Costa Rica, and Italy sit in this tier. Uruguay is the highest-stability country in Latin America by every measure and is the only Latin American destination in the "high stability" category. Political transitions are orderly. The rule of law is strong. Property rights are protected. Violent political change is extremely unlikely.

Costa Rica is the highest-stability country in Central America. It has no military, a long history of democratic elections, and strong environmental and property protections. The main stability concern is fiscal: Costa Rica's public debt is high, and fiscal austerity could affect public services, including the healthcare system (Caja). See the healthcare guide for Caja details.

Spain, France, and Italy face populist political movements, but the institutional framework is robust. Governments come and go; the property system, judiciary, and healthcare infrastructure remain.

### Moderate-High: stable with caveats

Greece, Panama, Malaysia, and Croatia fall here. Greece's stability score reflects its recovery from the 2010-2018 debt crisis. The country is now politically stable and economically growing, but the memory of capital controls and bank closures during the crisis is a cautionary example of what can happen when stability erodes.

Panama's stability is underpinned by the Panama Canal and its dollarized economy, which create structural constraints on political behaviour: the Canal is too important to the world economy for Panama to become a failed state, and dollarization limits inflationary populism. Political corruption exists (Panama Papers, 2016), but the system absorbs it without collapsing. See the tax guide for Panama's territorial tax treatment.

Malaysia's stability is moderate: democratic elections exist, but the system is dominated by ethnic and religious politics, and the 2018 and 2022 government changes were orderly but revealed institutional stress. The MM2H visa program has changed rules multiple times, most recently in 2024, which is its own form of instability for a retiree dependent on a specific visa category.

### Moderate: manageable but not guaranteed

Argentina, the Dominican Republic, Thailand, Georgia, and Vietnam. Argentina's political instability is a known quantity: economic crises happen, governments fall, currencies collapse, and life goes on. An Argentine retiree living on a dollar-denominated pension is insulated from the worst of it (the peso crashes, your dollars become more valuable), but the ambient instability affects daily life through strikes, protests, and service disruptions.

Thailand's political instability takes the form of coups and military interventions (2006, 2014). These are disruptive to Thai citizens but generally do not affect foreign retirees. The military government and the civilian government both value the economic contribution of foreign retirees and have not targeted retirement visas for restriction. The bigger stability risk in Thailand is the evolving tax treatment of foreign income (see the pension tax guide).

Vietnam is authoritarian-stable: no democratic process, no election risk, but also no property rights for foreigners (you cannot own land, only a leasehold of 50-70 years). The stability is real, but it is the stability of a one-party state, not the stability of institutions. See the visa alternatives guide for Vietnam's lack of a retirement visa.

### Moderate-Low: significant risk factors

Mexico, Brazil, the Philippines, Peru, Turkey, and Colombia. These are countries where political risk is a genuine factor in a retirement decision, not an abstract metric.

Mexico's stability concerns are institutional (corruption, rule-of-law weakness) rather than the risk of government collapse. The WJP Rule of Law rank of 99th reflects a judiciary that is slow and uneven, police forces that are undermined by cartel influence in some regions, and property rights that are legally protected but practically enforced through private measures (gates, security guards) rather than reliance on the state. For a retiree, this means: buy property in a well-established expat community with title insurance, do not rely on the courts to resolve disputes quickly, and maintain private health insurance rather than depending on public services.

Colombia's political stability has improved significantly since the 2016 peace agreement, but institutional capacity is still developing. Property rights are protected by law but enforcement in rural areas is weak. The government changes peacefully, but polarization is high.

### Low: proceed with full awareness

Nicaragua, Ecuador, Cambodia, Egypt, and South Africa. These are countries where political instability is a first-order consideration in a retirement decision. Nicaragua's authoritarian turn since 2018 has included property seizures. Ecuador's political volatility has included changes of government, protests that shut down the country, and a security crisis in Guayaquil. Cambodia is an authoritarian state with no property rights for foreigners and no path to permanent residency. South Africa combines democratic institutions (the EIU Democracy Index gives it 7.05, higher than Hungary or Poland) with extreme income inequality, high crime, and periodic service-delivery protests that turn violent.

A retiree can still choose these countries. Many do, and are happy with their decision. But the choice requires eyes-open awareness of the risk, not a belief that everything will stay the same for 20 years because it looks fine today.

The stability-and-currency connection

Political instability and currency depreciation travel together. A country that experiences a political crisis almost invariably sees its currency fall. For a retiree with a foreign-currency pension (USD, EUR, GBP), this is a perverse benefit: your cost of living in local currency terms drops at exactly the moment the country becomes harder to live in. For a retiree who has converted pension income into local assets (real estate, local bank deposits), a currency crisis is a capital loss.

The safest structure: pension income in foreign currency, living expenses in local currency, and as little capital as possible locked up in local-currency assets that you cannot sell quickly. This is why the tax-friendly ranking gives high marks to dollarized economies (Panama, Ecuador) and countries that allow you to hold assets in foreign currency.

What happens when stability goes: Venezuela as the cautionary tale

Venezuela is not on the RetireSpots directory, but it is the cautionary tale for every retiree who assumes stability is permanent. In 1999, Venezuela had a retirement visa, a stable currency, and a tourism industry. By 2018, it had a 1,000,000% inflation rate, a collapsed healthcare system, and millions of citizens who had fled the country. The retirees who left could not take their property with them.

Venezuela is an extreme case, but the lesson generalizes: political stability is not a permanent feature of a country. It can erode faster than you expect. The best protection is not putting all of your financial and residential eggs in one basket. Maintain assets in your home country. Keep a bank account abroad. Have a plan for leaving if leaving becomes necessary.