Asia's elderly population is projected to reach nearly 923 million by the middle of this century. As a result, the region is on track in the next few decades to become one of the oldest in the world. Governments in Asia are generally poorly prepared for this vast change that will have wide social and economic consequences.
A comprehensive ADB report found that rapidly shifting demographics - particularly declining birth rates and increasing life expectancies - will increasingly shape the economic direction of developing countries in Asia. The favorable demographics that have driven high economic growth in the region are likely to reverse.
"As the population dividend that fueled Asia's rapid growth becomes a tax, the region must find innovative ways to sustain economic expansion, and provide better support for its growing elderly population." - Juzhong Zhuang, ADB's Deputy Chief Economist
"Asia's population is aging quickly,” said Juzhong Zhuang, ADB's Deputy Chief Economist. "As the population dividend that fueled Asia's rapid growth becomes a tax, the region must find innovative ways to sustain economic expansion, and provide better support for its growing elderly population."
The report, Impact of Population Aging on Asia's Future Growth, examines demographic trends and how they will affect economic growth in 12 developing Asian economies that make up the bulk of the region's population and output.
Another ADB study, Pension Systems in East and Southeast Asia: Promoting Fairness and Sustainability examines the twin challenges facing governments in the region: maintaining growth and providing affordable and sustainable income support for the elderly.
In the People’s Republic of China, more than half the population lives in rural areas but only about 10% are covered by rural pension schemes, according to another ADB study. In India, the pension system for civil servants and salaried employees in the private sector covers only about 14% of the workforce. Most of India’s workers are employed in the informal sector and are excluded from the benefits of a regulated retirement income system.
ADB research has focused on solutions, such as Pension Systems and Old-Age Income Support in East and Southeast Asia: Overview and Reform Direction. This book examines concrete and specific policy options for reforming Asia's pension systems. This includes not only country-specific strategies but regional solutions as well, such as the need to extend pension coverage.