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ASEAN ANALYSIS 21 June 2010

Ageing in Asean: window of opportunity?

By David Swartzentruber
AseanAffairs 21 June 2010

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One of today’s news items detailing the plans of Singapore’s housing authority to tailor housing to meet the needs of an ageing population and the influx of new immigrants, suggested a look at demographic change in the Asean countries.

As one might guess, Asean nations are younger than the developed nations of the United States, western Europe and Japan. Japan ranks as the world’s “most aged” country.

Ageing is a natural process and it is coming to Asean countries as well with the reduction in both fertility and mortality.

Thailand, for example, has a window of 12 years before it enters the ranks of an aged country. For Malaysia, the demographic opportunity will end after 2020, when her population will be consider aged based on the median age. The same population ageing at lower levels of development is also seen in Vietnam and Indonesia, while the older population in Myanmar is twice that of Malaysia’s. Each Asean country is different.

The ageing issue has already raised its head in Thailand, as the country’s legal age of retirement is 60, which by modern standards of improved medical care is extremely young. At the present time, Thailand, is facing a labor shortage in many sectors and it has been suggested that the retirement age be raised upward to retain qualified workers longer but no concrete changes have been made to the policy.

As is the case in other developing countries, the rapidity of the ageing process threatens to derail the prosperity boom of the Asean countries. In that regard, Singapore and Thailand are thought to be the only Asean countries that have even provided lip service to the issues generated by an ageing population.

Not only are the societies in the region taking less time to make the demographic transition from “young” to “old”, but it is also happening at a much lower development level than developed nations. Asean countries possess fewer resources compared to their developed counterparts and will have fewer options to address the impacts of population ageing.

Age Distribution, Ageing Index and Median Age in ASEAN Countries, 1980, 2000 & 2020 Projection.

As can be seen by the above chart (provided by Asean), by 2020, the countries of Brunei, Cambodia, Laos, Philippines and Vietnam will be the more youthful counties in Asean, while the remaining countries will be joining developed nations in the ageing cycle.

International conferences and debates on how to deal with an ageing population fall into two categories. Those countries who see ageing as a problem will address it from a social welfare position. Those countries that promote active ageing by advancing health and wellbeing and ensuring support-based environments could lessen the impact of older citizens by keeping them active in the work force.

In the case of Asean countries, much will depend on the resources each country has to address the ageing issue.

Another significant trend, would be a freer flow of labor within the Asean countries from one country to another. A scenario could be migration from an Asean country with younger workers to a country needing them. This cross-migration flow is already anticipated with the common market slated to open in 2015.

The issue then raises its head regarding the quality of the migrant workforce. Could a worker from some of the less-developed country handle a job in a country that requires a higher level of education or training? Of course, language and cultural adjustment could provide other obstacles.

These are issues that Asean must address in the midterm to ensure the continued growth and stability of the region’s economies.


 


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