Women in the Republic of Moldova earn less than they consume during their entire life, while the income of men exceeds the consumption only between 24 and 53 years of age. At the same time, the demographic shift towards an ageing population in the Republic of Moldova can offer opportunities for the country’s economic growth thanks to people’s life-time savings, made to cover their consumption when growing older. These are the main findings of the study ‘Analysis of the Demographic Dividends of the Republic of Moldova’, launched on Tuesday, 31 May 2022, during a public debate of the ‘Expert Grup’ Independent Think-Tank in partnership with UN Population Fund (UNFPA Moldova).

The event was held online and addressed the demographic trends and their impact on the economic development of the Republic of Moldova.

‘The Republic of Moldova is facing a demographic transition characterised by a decreasing population, low birth rate, high mortality, low life expectancy, labour force migration and demographic ageing. In this regard, population policies are very important for ensuring demographic resilience, and investments in human capital are the most profitable for the wellbeing of a society’, stated Felicia Bechtold, State Secretary, Ministry of Labour and Social Protection of the Republic of Moldova.

According to the State Secretary, demographic policies are a priority for the Government and the new legal amendments allowing employers to set up alternative care services for their employees’ children under 3 years of age, as well as promotion of flexible work schedules, shared parental leave, a flexible childcare leave, the concept of the National Nursery Fund – measures that support women and men to have the desired number of children and to be able to reconcile their work and family life, are the results of demographic policies developed on the basis of the ‘Theory of change for demographic resilience’ concept and of the data provided by ‘Generations and Gender’ Survey, carried out by UNFPA.

Nigina Abaszada, UNFPA Resident Representative, expressed her appreciation for the efforts and engagement of the Government and of the Ministry of Labour and Social Protection of the Republic of Moldova in building the Demographic Resilience. ‘Today we are achieving a new level of understanding of demographic dividends, which shows how we can transform the population structure, including the negative connotations related to population ageing, low birth rate and emigration, into opportunities for country’s development. The findings of the study launched by Expert-Grup will help develop new family-friendly and active ageing regulations and policies and will improve the Demographic Resilience, which is our end goal’, said Nigina Abaszada.

Adrian Lupusor, Executive Director of Expert-Grup, stated that: ‘Demographic Dividends is a relatively new concept for the Republic of Moldova, and applying this conceptual approach will allow to conduct a complex analysis of the demographic trends and as a result, to identify public policies that are better adapted to the population’s needs.’

The relationship between economic developments and demographic dynamics can be explained by a theoretical approach based on the concept of the first and second demographic dividend, which is aligned with the idea of ‘economic life-cycle’ represented by producers and consumers. In general, during the life cycle, a person can be:

• net consumer – a child or an older person, who has a deficit because the earned income is lower than the consumption;
• net producer – employed adult who has a surplus, because the earned income exceeds the consumption.

Expert and author of the study, Alexandru Fala, Program Director at ‘Expert-Grup’, made a series of recommendations in order to reduce the negative influence associated with the first demographic dividend. The expert believes that creating conditions for parents to end the childcare leave earlier would be an appropriate solution. Offering more opportunities to work past the retirement age is another important aspect to be implemented.

At the same time, in order to augment the opportunities provided by the second demographic dividend, the author recommends to take action in order to strengthen the corporate governance and transparency in the financial sector, and increase people’s trust in the financial sector and in the justice system. Ensuring macroeconomic stability, diversifying financial products and ensuring people’s access to these products, promoting financial education – are other recommendations highlighted in the study presented today.

During the public discussions, the expert Michael Herrmann, Senior Advisor on Economics and Demographics, UNFPA, underlined that demographic dividends are not an automated process and need important investments in human and physical capital, technologies, infrastructure and education, emphasising that the Republic of Moldova is a regional leader in terms of national demographic trends analysis.