Reforms needed for region’s aging population

Phnom Penh—The Asian Development Bank (ADB) has issued a dire warning about developing nations in Asia and the Pacific being ill-equipped to meet the needs of their rapidly aging populations.

The region’s growing elderly demographic faces numerous challenges, including low pension coverage, health issues, social isolation, and limited access to essential services. Urgent and comprehensive policy reforms are required to ensure the welfare of older individuals, as highlighted in the recently released “Aging Well in Asia: Asian Development Policy Report” during the bank’s 57th Annual Meeting held from May 2 to 5 in Tbilisi, Georgia.

By 2050, the number of individuals aged 60 and above in developing Asia and Pacific nations is projected to nearly double, reaching a staggering 1.2 billion, or about a quarter of total population. This demographic shift means there is urgent need for adequate pension and welfare programs, along with improved health-care services.

The report, however, notes the potential for a “silver dividend”—additional productivity from older individuals that could potentially increase the region’s gross domestic product by an average of 0.9 percent.

ADB chief economist Albert Park highlighted the need for prompt government action to prepare for the challenges, and called for policies that focus on lifelong investments in health, education, skills, and financial preparedness for retirement. Additionally, nurturing family and social ties is crucial to foster the well-being and productivity of older people and maximize their contribution to society, he said.

The report reveals a distressing statistic: 40 percent of individuals aged over 60 in Asia and the Pacific lack access to any form of pension. This issue disproportionately affects women, who often engage in unpaid domestic work. Consequently, many older individuals are forced to continue working well beyond retirement age merely to make ends meet. Among those still employed at age 65 or older, a staggering 94 percent work in the informal sector, which typically fails to provide basic labor protections or pension benefits.

Beyond financial concerns, physical and mental health issues become more prevalent with age. The ADB report indicates that some 60 percent of older individuals in the region do not receive regular health checks, while 31 percent report depressive symptoms resulting from illness, social isolation, and economic insecurity. Older women in the region are particularly susceptible to health problems, including depression, diabetes, and hypertension, compared to their male counterparts.To address these pressing challenges, the report calls for a range of policy measures that include government-assisted health insurance and pension plans, improved health infrastructure, and the provision of free annual check-ups and lifestyle evaluations. The report also urges policymakers to strive toward universal health-care coverage and extend basic labor protections to older individuals working in the informal sector.By adopting measures such as flexible retirement ages, promoting health among the elderly, providing suitable work opportunities, and facilitating lifelong learning and skills development, economies in the region can harness the productivity and expertise of older individuals for a longer duration, the report concluded.

Aiko Kikkawa, a senior ADB economist and one of the authors of the report, said Cambodia was not facing an imminent critical condition compared to Thailand or Vietnam. She noted that with its smaller population, Cambodia can transition more rapidly, although she stressed the importance of early preparation to support the population effectively.

There is also need for collaboration with the young population, and the encouragement of mindfulness about their health, careers, and the importance of retirement savings, Kikkawa added. She emphasized the importance of proactive measures to ensure that the younger generation is adequately prepared for their future.

“[T]he country has to prepare to be able to support (these current young people). You do not want to wait until you have many older persons,” she said.

The ADB reaffirmed its commitment to foster a prosperous, inclusive, resilient, and sustainable Asia and the Pacific. The bank aims to eradicate extreme poverty while addressing the challenges posed by the region’s aging population.

ADB chief economist Park also highlighted the bank’s support for modernizing social protection programs for various governments by improving information systems, digitalization, and data collection to enhance access to resources during crises like the COVID-19 pandemic. The Phnom Penh Post/Asia News Network

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Sam Rith is managing editor of The Phnom Penh Post.

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