Demographic challenges in Europe

1. Demographic change and migration: challenges & solutions.Lithuanian case 2007-09-27By Rimantas ŠadžiusMinister of FinanceRepublic of Lithuania

2. Demographic challenges in Europe • Population decline in some regions (mainly in the new Member States) due to: • Migration to more prosperous regions of the EU; • Negative population growth in general; • Unfavourable tendencies in the age structure of the population; • The number young people (under 15) declining; • The number of older ones (above 64) increasing; • Rural areas continue to loose population due to: • The limited choice of jobs; • Lower living standards in rural areas.

3. … and in Lithuania • Low birth rate (1,3) and ageing population 20 % of population are older than 60 years; • Emigration and increasing shortages of labour force in some areas as result of it; • Depopulation of rural areas.

4. Problems caused by ageing population • Increasing demand for quality health and social services; • Older people more difficult adapt to changes in labour market; • Pressure to budget (welfare of older people depend on the level of social pensions).

5. Emigration from Lithuania: 3 % of population during 2004-2006 thousands

6. Depopulation of rural areas • Low level of living environment (Insufficient quality of public services, underdeveloped basic infrastructure); • Lack of good jobs (48 % rural inhabitants work in agriculture) results in low income; • Better opportunities in capital city or abroad.

7. Any medicine for those ills? • Improvement of living conditions in lagging behind regions, especially in rural areas: further development of quality public urban and rural infrastructure and services. Increasing attractiveness of those areas for private investment. • Creation of better jobs. Increasing the share of higher value added businesses in the economy. Increasing the support for R&D, innovation activities. Diversification of business activity in rural areas. • Improvement in quality of education: Strengthening interconnectivity between the educational system and the needs of labour market. Raising the levels of lifelong learning. • Strengthening local governance: involvement of local communities in decision making to reflect local needs. • Special measures designed for returning migrants to Lithuania.

8. How we plan to address these challenges with EU Cohesion policy support for 2007-2013 • Greater emphasis on living environment: improvement of basic infrastructure (transport, energy, information technologies) and services (education, health, social and other infrastructure) contributing to living quality; • Creating more and better jobs: 10 percent of structural assistance will go to research and technological development; • Investing in the development of human resources especially into adaptability of workers skills and life-long learning programmes (9 percent);reorientation to other economic activities of rural inhabitants employed in agriculture. • Stronger involvement of counties and municipalities in planning structural assistance in accordance with needs of their people.

9. Demographic challengesand future of EU Cohesion Policy: • Complex approach is needed: This approach should include more divers actions to make regions more attractive for people to live, work and invest. • As well as more flexible one: no general recipe for all EU regions because causes of problems and cures might be different and very specific. Regions themselves should decide what actions are most important and beneficial for their people.