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Low birth rate, migration to hinder Romania’s long-term economic growth - expert

Low birth rate and workforce migration in Romania could hinder the country’s long-term sustainable economic growth, a prominent Romanian economist said Thursday.

“Because of its demographic problems, Romania cannot hope to maintain such growth in the long run,” said Valentin Lazea, chief economist of Romanian National Bank during a seminar. “Only seven economic entities in the world could manage to sustain economic growth of over 5% for more than 20 years, such as China, Ireland and Macao, but none has had demographic issues,” Lazea said.

Even though the migration of Romania’s workforce to other European states may be reversible, the country’s constant drop in birth rate since 1992 cannot be compensated and will start to affect the labor market in 2010, he said. Bianca Pauna of the Romanian National Economic Research Institute said employment rates are lower among youngsters compared to other age categories largely due to migration.

Some 10% of the country’s population has migrated, including 25% of the country’s active workforce, according to a recent study. Workforce shortages are particularly serious in urban areas as migration from rural areas is lower than expected, said Pauna.

Romania hit a record economic growth of 8.6% in the Q2 this year thanks to dynamic investment. Analysts forecast that the country’s economic growth may exceed 6% in 2008. (Xinhua)