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Ministry of Labor, Family and Social Protection, World Bank and UNICEF have launched the Rapid assessment of the impact of economic crisis on poverty.

World Bank and UNICEF Romania in partnership with the Ministry of Labor, Family and Social Protection have launched Rapid assessment of the impact of economic crisis on poverty. The report represents a rapid assessment of the likely impact of the economic crisis on poverty in Romania. It examines the poverty profile for the year 2008, the profile of the population at risk of falling in poverty in 2009, with a special focus on children, and the capacity of existing family and children allowances to offer adequate protection against crisis impact.

According to the report, Compared with other age groups, children (0-14 years) and youth ( 15-24 years) face the highest risk of poverty. Children and youth represent as much as 43 percent of the poor, both in 2008 and in 2009.
In 2008, the poverty continued the declining trend, driven by a GDP growth rate of 7.1 percent. Nonetheless, 1.22 million persons, including 256 thousands children, were registered as living in absolute poverty.

After eight years of sustained economic growth, Romania will experience in 2009 an economic downturn as a consequence of the global growth slowdown. According to most recent IMF and Government estimates, Romania’s GDP will contract in 2009 by 4 percent.
Poverty continues to be concentrated in rural areas, but in 2009 the urban poverty is likely to increase faster than rural poverty, as a consequence of increased unemployment and significant impact of crisis on the nonagricultural informal workers.

The report also states that it is highly unlikely that the current system of family and children allowances would be able to adequately and efficiently protect the families with children at risk of poverty in 2009, given the fiscal impact of the economic crisis, with an estimated budget deficit of about 4.6 percent of GDP in 2009. Local social services are either insufficient or lacking the necessary quality to effectively protect the most in need children in normal circumstances, let alone in crisis times.