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Poverty has a firm grip on Romania’s rural areas, where almost half (44 per cent) of the population lives. In 2003 the UNDP Human Development report estimated that 38 per cent of rural people were living in poverty, compared with 14 per cent of people in urban areas. Rural people are particularly vulnerable to the hardships brought by the painful economic and social transition after the collapse of communism.

The restructuring of the farm sector led rural people and displaced industrial workers to revert to subsistence farming on privatized land. Productivity and incomes are low because poor subsistence farmers and livestock producers have limited inputs and resources. They use outdated farming methods, and they have little or no access to capital and markets.

The overall poverty rate almost doubled in the late 1990s from 20 per cent in 1996 to 35 per cent in 2000, as the country struggled to stabilize the economy. Since then, increased stability and more rigorous reforms have led to stronger economic growth and an improvement in living conditions. On the 2007 UNDP Human Development Index Romania ranked 60th out of 177 countries, a rise from 64 in 2005.

Who and where are Romania’s poor rural people?

The country’s poor people are subsistence farmers, unemployed rural workers and women who are heads of households. The poorest people live in remote mountainous areas, where infrastructure and social services are lacking.

Why are they poor?

Low agricultural productivity is one of the main causes of poverty in rural Romania. Poor small-scale farmers do not have the collateral to secure loans that would enable them to invest in agricultural inputs and equipment to improve their incomes. And in rural areas there are limited opportunities for formal employment opportunities, partly because of minimum wage regulations, high payroll taxes and the rigid labour code. Inadequate social services, reflected in the poor condition of rural health centres, long distances to schools and poor sanitation facilities, also contribute to rural poverty.

Source: IFAD