Demographic pressures and the sustainability of social security in Emerging Europe and Central Asia

How serious are the long-term effects of population ageing in the emerging economies of Eastern and South-Eastern Europe, the Caucasus and Central Asia? This paper investigates long-term effects of population ageing in a number of emerging market economies.In most of them, the ageing process will be associated with rising dependency ratios as the share of the working-age groups in total population shrinks. The combination of an ageing and declining population is likely to reduce the effective labour supply, threatening to undermine the sustainability of their public pension and health systems. Demographic and economic data confirms the severity of the demographic crisis' consequences for fiscal sustainability. There is compelling evidence for most countries in the region to undergo wide reaching policy reforms with a focus on pension systems and labour markets. Also, the public health sector needs to be reformed with a view to increasing its efficiency.