Population decline endangers economy

The continuous decline in Romania’s population over the last two decades will have disastrous long-term effects on the economy, according to a study conducted by the Demographic Research Centre at the National Institute for Economic Research (INCE) at the Romanian Academy. The study shows that since 1990, Romania’s population has decreased by almost 1.5 million, i.e. 6.5%, due to a low birth rate, Romanians’ emigrating to work abroad, and a rising death rate.
“In the short term, i.e. 3-4 years, the decline in population is an advantage for the economy, as the state will pay out less money for social security. In 20 years’ time however, we could be facing a disastrous situation, because as the population continues to decline, the share of old people will rise, with insufficient money to cover pensions,” believes Mircea Ciumara (photo), general manager of the INCE and former Minister of Finance in the Ciorbea cabinet.
According to the CCD study, Romania’s population will have dropped by almost 23% by 2050, to 16.7 million inhabitants, if the birth level remains the same as in the last few years, at 1.3 children per family.
These figures are more optimistic than the estimates made by the UN, which predicts Romania will only have 14.9 million inhabitants at the halfway point of this century. What is more serious, say experts, is that the share of old people will rise from 19.3%, at the end of 2005, to 39% in 2050, which means 85 elderly people per every 100 adults, as compared with the currently level of 34 per 100.