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Moscow Times
December 22, 2005
Demographic Crisis May Cost $400Bln
By Lyuba Pronina
Staff Writer

The Russian economy is set to lose over $390 billion in the next two decades if the government, business and society do not take immediate action to reverse the demographic catastrophe already looming, a business lobby group said in a report Wednesday.

Businesses are already struggling with a shortage in the work force as the country's falling birth rate and climbing mortality rate make the Russian population one of the world's most rapidly shrinking, Delovaya Rossia, a lobby group for small and medium-sized businesses, said.

"Finding workers is getting more and more difficult for business," Boris Titov, chairman of Delovaya Rossia, said at a round table on demographic problems.

The Russian population has dropped by 10.4 million people over the last 14 years to 143.4 million, and the country is set to lose another 21.4 million by 2025. The economically active population will shrink by 3.6 million in the next five years alone if the demographic crisis is not tackled, the report said.

The increasing economic and social marginalization of the male population and the widening gap in life expectancy between men and women risks turning Russia into a female-dominated country, the report said.

The lobby group slammed the government for its lack of a demographic policy, warning that the state could lose $390.8 billion) in gross domestic product by 2025.

Demographic policy "is not even part of the priority programs proclaimed by the state," Titov said.

Delovaya Rossia said the government should spend at least 4 trillion rubles ($139 billion) on demographic programs in the next 20 years, which should include financial support for families with two or more children, and for fighting abortions and deaths induced by alcoholism, car accidents and unhealthy lifestyles.

Setting clear-cut rules for immigration could also help to bring an additional 20 million people into the work force from the countries of the Commonwealth of Independent States, while measures should be taken to reduce the outflow of qualified employees and abolish adoption of Russian children by foreigners.

"If we don't take measures in the near future, we won't be able to talk about any economic development or doubling the GDP," Titov said.

The World Bank warned earlier this month that the economy would lose $66.4 billion over the next decade if the government did not tackle the country's population decline and encourage healthier lifestyles.

Andrei Kurayev, however, a professor at the Moscow Theological Academy, cautioned against loosening restrictions on migration, as it may not be able to absorb incoming cultures. The Russian Orthodox Church should become more accessible to people, especially the younger generation, he said, and seek them out in their own environment -- even "at rock concerts."