BCR: Aging population could have negative impact on Romania’s economy
The aging process of the population can have a major negative impact on the economy of Romania, where one in seven Romanians exceeded the age of 65 years, warns a report by BCR Research on the reduction of the active labour force.
‘In the absence of rapid improvements in the birth rate, one of five Romanians will be aged 65 or more in 2030 and in 2060 the ratio will be 1 to 3. In 2030 women will live in retirement for 22 years and men for 17 years. The gradual increase in the standard of living during the active life will make retired people to be less willing to accept a change in the standard of living after 65 years, in the context in which their incomes will be shorter and their public pensions would have to be supplemented by other financial resources accumulated from the age of 30. The aging of the population in Romania is more pronounced in agriculture, where one-third of the employed persons are aged over 55 years,’ said the author of the report, BCR chief analyst Eugen Sinca, in a press conference.
A significant consequence of the aging of the population will be a decrease in the potential GDP because of both the reducing contributions as labour force and as capital, in the context of poor domestic saving.
Romania, together with Slovakia, Poland, Latvia and Slovenia, are the top five European Union member states where population ageing is expected to speed up over the next years.