Moody’s demographic alarm

Moody's warned on Tuesday that worsening demographics and the increase in the dependency ration of the elderly constitute a serious fiscal challenge as well as a cause of downgrades of states' ratings. Greece, as it states, is expected within the next decade to have the fifth highest dependency ratio among all developed economies internationally.

As the prestigious rating agency points out, population aging continues to accelerate in developed economies as people live longer and birth rates decline. The elderly dependency ratio, which measures the proportion of people aged 65 and over to the working-age population (15-64), is expected to rise to 40% over the next decade, from 32% in 2023. This means that a declining number of employees will support an expanding pool of retirees. According to the agency Japan will continue to record the highest dependency ratio (60%),...