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Without Smart Investment in Human Capital, Romania Risks Condemning Future Generations to Poverty

Romania was ranked 67th – behind its EU neighbors – in the new Human Capital Index (HCI), launched by the World Bank Group on Friday. Singapore, with an HCI score of 0.88 (on a scale of zero to 1), topped the list, while the top 20 spots were dominated by EU member states. Romania came in at 67th place, trailing countries with much lower per capita income, such as Ukraine (50), Albania (56), and Georgia (61).

Romania’s score – at 0.6 – means that children born in Romania today will be 60 percent as productive when they grow up as they could be if they enjoyed complete education and full health. Worryingly, between 2012 and 2017, the HCI value for Romania decreased from 0.63 to 0.60. The HCI is made up of five indicators: the probability of survival to age 5; a child’s expected years of schooling; quality of learning; the fraction of 15-year old that will survive to age 60; and the proportion of children who are not stunted. Scores are compiled for 157 participating countries to allow for a ranking of their human capital potential.

Romania’s ranking reflects the need for urgent improvements in health and education outcomes: a child in Romania can expect to complete 12.2 years of pre-primary, primary and secondary school by age 18. By comparison, a child in France can expect to complete 14 years. More troubling, when years of schooling are adjusted for the quality of learning, World Bank estimates that a child in Romania only benefits from 8.8 years of schooling: a learning gap of 3.4 years, the largest gap in the EU. Similarly, the percentage of 15-year-olds that will survive to age 60 stands at only 87 percent, compared to, say, 91 percent in Croatia and 95 percent in Sweden.

The Human Capital Index highlights that Romania needs to invest in the health and education of its citizens if it wants to remain competitive in the long run. The World Bank is committed to assist Romanian authorities in their efforts to invest more and invest smarter in human capital, in quality healthcare systems and educational programs,” said Tatiana Proskuryakova , World Bank Country Manager for Romania and Hungary.

The Human Capital Index (HCI) is part of the Human Capital Project, which is launched to incentivize and support national leaders to prioritize transformational human capital investments. The objective of the initiative is to accelerate progress towards a world in which all children arrive in school well-nourished and ready to learn, can expect to receive quality learning in the classroom, and are able to enter the job market as healthy, skilled, and productive adults.

The World Bank opened its office in Romania in 1991. Since then, the Bank has provided over US$13.6 billion in loans, guarantees and grants in all sectors of the Romanian economy. The Bank’s current portfolio includes investment lending, analytical work, and technical assistance to support Romania’s reform priorities. In 2016, the World Bank Group and Romania celebrated 25 years of continued partnership in supporting poverty reduction and inclusive growth.

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