Romania's income per capita increased from 26 percent of the EU-28 average in2000 to 64 percent in 2018. The economy has opened to trade and investment and has gone through a structural transformation from heavy industry to services, while agriculture still contributes 4.8 percent of total gross value added and 23 percent of total employment. Romania's economic success rests on the wobbly foundations of unfavorable demographics, weak human capital, and ineffective institutions. These shortcomings are taking a toll on the pace of convergence with wealthier European Union (EU) partners, with average annual labour productivity growth dropping from 9.0 percent in 2000-08 to 3.1 percent in 2009-17. Between 2000 and 2018, Romania's population fell from 22.5 million to19.5 million, with emigration accounting for more than 75 percent of the decline. Meanwhile, labour force participation in 2018 stood at 67.8 percent, one of the lowest rates in the EU, and only 58.3 percent for women. However, it has increased steadily over the past decade for both men (by 6 percent) and women (by 3.4 percent).Weak human capital aggravates the plight of labour supply. Forty percent of 15-year-old Romanian students do not achieve minimum literacy proficiency, and only 15 percent of the working-age population has completed tertiary education.The generally low quality of institutions adds to the structural weaknesses of theeconomy. Reforms that would help enhance the economy's growth potential areoften held back by poor coordination among different parts of government, ineffective policy implementation and monitoring, and politicisation of decision making. Based on consultations with stakeholders, competition and human capital werechosen as the focus of the Romania Country Economic Memorandum 2019. These two pillars were recognised as critical to increasing the economy's growth potential and as areas that can stimulate a constructive policy debate.
The World Bank came into formal existence in 1945 following the international ratification of the Bretton Woods agreements. It is a vital source of financial and technical assistance to developing countries around the world. The organization's activities are focused on education, health, agriculture and rural development, environmental protection, establishing and enforcing regulations, infrastructure development, governance and legal institutions development. The World Bank is made up of two unique development institutions owned by its 185 Member Countries. The International Bank for Reconstruction and Development (IBRD) focuses on middle income and creditworthy poor countries and the International Development Association (IDA), which focuses on the poorest countries in the world.
