ECONOMY

World Bank advises Serbia to raise retirement age as pension system is strained

BELGRADE (Reuters) – The World Bank advised Serbia on Friday to raise retirement ages as part of reforms to make its pensions system sustainable given an aging population. World Bank official Cheryl Gray said Serbia, like many Western Balkan economies, had inherited a workforce which enjoyed generous pensions with low retirement ages and things had to change. «The middle income countries need to streamline the benefits and make them affordable, and raise the retirement ages for men and women to a higher level and to an equal level,» Gray told a meeting of Serbian economics professors. Gray, director of the bank’s Poverty Reduction and Economic Management Department for Europe and Central Asia, said with declining employment since the start of transition, fewer people had been left to pay into the pension system. «And the demographics are such that there are more old people and fewer young people. All these things together put a huge pressure on the pension systems. The structural challenge is huge,» she said. Serbia adopted a pension reform two years ago, raising the retirement age to 65 from 63 for men and to 60 from 58 for women as of 2008.