The first warns of looming disaster a shrinking labour force, unsustainable pension, and healthcare subsidies increasing the fiscal strain and destabilising the economy. Here, demographic upheaval foreshadows an inevitable economic decline, if not total collapse. Those who disagree consider this analysis too Malthusian: it overlooks increases in productivity, and the reduced fiscal burden of households with fewer children to support. These pundits see demographic change as a gradual transition and not an imminent crisis.
In the swirl of commentary on the Asian countries in recent years, one facet of their longer-term prospects not often remarked upon is that their population is aging. By 2025, the share of the elderly in the population of Singapore, Hong Kong, Taiwan, Japan and South Korea will at least doublem and the share of the young will fall sharply.
The ageing of the population will drag down the potential rate of growth as a result of the fall in volume of labor input and the decline of the domestic saving rate. Furthermore, it will also serve as negative effects upon fiscal conditions and households through the decline of tax revenues, rise of healthcare costs and pension burdens. However, the rate of economic growth is the sum of the rate of per capita GDP growth and the rate of population growth. Even if the labor force population decreases, economic growth will not turn negative as long as the rate of productivity growth is sufficiently high. From this perspective policy initiatives to raise productivity such as the following would be important: measures to upgrade human capital through education and the improvement of capital efficiency through innovation
Demographic ageing and the decline of the birthrate are no longer issues inherent to industrialized countries. It is a phenomenon which is also progressing in the countries of Asia experiencing rapid growth as the “world’s growth centre” (Heller, P,1998).
The social impact of ageing and the declining birthrate will grow larger along with the passage of time. For the countries of Asia, ageing and the declining birthrate are no longer a futuristic issue. To prepare for the impending demographic onus, the countries of Asia must cope with the “clear and present issues” depending upon the degree of the ageing process (Hicks, P,1998).
We will therefore look at five different countries on it’s ageing population and the policies they imply to overcome it.
Ageing population in Singapore is an urgent problem that the society is facing today. In the years to come, there will be dramatic changes in the structure of Singapore population brought by persistently low fertility rates and consequently an ageing population (Choo, P, W, J., Lee, KS., Owen, R,E & Jayaratnam, F, J., 1990).
The proportion of residents (i.e. citizens and PRs) aged 65 and above increased from 7.0% of the resident population in 1999 to 8.8% in 2009. Correspondingly, the number of younger residents aged 15-64 for every resident aged 65 and above (i.e. the old-age support ratio) fell from 10.1 in 1999 to 8.3 in 2009. There was an increase of 34% of elderly people between 1985 to 2025. 3.1.2
Japan is a rich country with a generous social security system and high individual savings (Lam, P, 2009). Retirees today can expect a fairly comfortable life in their sunset years. But the nation is facing a looming demographic and fiscal crisis, which cannot be resolved easily.
In 2007, 21.5% of the Japanese population was over 65 years old. It is projected to rise up to 40.5% by 2055 (Hicks, P,1998).
Taiwan had a total population of 23.2 million, with those aged 65 and above numbering 2.3 million (about 9.97%) (Chen, L, 2008). According to the World Health Organization, a country is classified as having an ageing population when this aged...
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