SHAPING THE FUTURE HOW CHANGING DEMOGRAPHICS CAN POWER HUMAN DEVELOPMENT

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Countries need to make an institutional and datadriven commitment to the well-being of older people 144 Older countries such as Japan and the Republic of Korea used to be migrant source countries. But both in recent years, having increasingly seen the need to attract younger people to their workforces, have amended and adopted laws and regulations to ease the flow of immigrants to their own countries. SUSTAINING HUMAN DEVELOPMENT ACROSS LONGER LIFESPANS Developing Asia-Pacific countries have made significant strides in improving human development. But rapid ageing poses potentially serious challenges to progress without appropriate policy actions, taken urgently. Ageing also offers opportunities that should not be squandered. Countries need to manage their resources—human and otherwise—to ensure that they develop in ways that sustain progress and open opportunities for all segments of their populations, young and old. Drawing on Agenda 2030 and the three pillars of the Madrid International Plan of Action on Ageing, strategies to guide ageing should be grounded in the active empowerment and engagement of older persons, where they have central roles in decisions on the issues they face. All strategies should be underpinned by core principles such as equity, sufficiency and sustainability. It will be possible to manage rapid aging while sustaining human development. This will require a number of complementary policy reforms. Measures will be needed on both an individual level, such as through preventive health and financial preparedness, and on the societal level, on key issues such as retirement age and the design of pension systems. The private sector and civil society will have roles to play, such as in extending services and pioneering innovations. MAKE AGEING A TOP POLICY ISSUE, BACKED BY INSTITUTIONAL SUPPORT Enact national ageing policies: An ageing population is inevitable, underlining that it must be prioritized in national development policies and plans. These should uphold the rights of older persons to participate in the development process, and to have access to all the capabilities and opportunities on which human development depends, with a special emphasis on quality mental and physical health and long-term care. Policies can cover a wide range of issues relevant to older persons and, more generally, an ageing population, such as using community-based approaches to encourage the meaningful participation of senior citizens in decision-making, sharing information about preventative health care and protecting the rights of older people. Special attention should go to groups facing age discrimination combined with other forms, particularly women. Equally important is to adopt a national strategy or plan for ageing economies. Countries will change in fundamental ways as age composition shifts. Ageing will impact the size of the labour force, tax revenues, GDP, public expenditures on health care and pensions, and other key macroeconomic indicators that affect not only older people, but the population at large. A long-term vision and planning can help countries secure a healthier, more economically stable future. Plans will need to be backed by necessary budget resources and oriented around clear goals. Countries that start investing now in pension and health care, in particular, stand a better chance of sustaining and achieving additional human development gains. Mainstream ageing issues and establish relevant institutional mechanisms. While many Asia-Pacific countries have enacted ageing-related laws and regulations, implementation remains limited. Countries need to ensure policies and concerns linked to ageing are understood and reflected across a variety of government actions. Entities housed under the ministries of labour, health and social welfare, among others, might serve as instruments to carry forward this process. Government institutions dedicated to the well-being of older people can help ensure that policy promises get off the ground. They can advocate for the elderly, focus public attention on their challenges as well as the positive social and economic benefits they offer, and
help coordinate the work of other government agencies on the diverse array of issues tied to ageing, including the economy, labour markets, health care, housing, transportation, and so on. Institutions to conduct inspections, surveys and hearings on ageing interventions can be means to uphold accountability and avenues for older people to participate. In Japan and Thailand, interministerial councils and commissions on ageing, chaired by the Prime Minister’s Office, oversee policy implementation. New Zealand has appointed a minister for senior citizens. Australia, China, Malaysia, the Republic of Korea and Thailand reserve seats in different consultative bodies on ageing for older persons. Gather data about older people to guide policy: Knowledge about population ageing is limited in the region. Building a better foundation of data, evidence and knowledge will help make policies more attuned to reality on the ground. More research is needed on the social, psychological, cognitive and biological aspects of ageing. Data collection should be disaggregated by age, sex, subnational units and socioeconomic characteristics, and collected through periodic surveys that reveal patterns and gauge progress over time. International and regional cooperation can enhance the exchange of information, including across countries at the same as well as different stages of transition. STRENGTHEN PENSIONS AND PROTECTION FOR OLDER PEOPLE Expand pension and social protection coverage. With some social traditions and family ties beginning to fray, including through increased urbanization and migration, pension systems will become crucial for older people to live out their lives in a decent, dignified manner. In Asia-Pacific, excluding China, pensions cover only one-third of the population. 112 In a rapidly ageing region, expanding coverage to all will be fundamental to human development. Pension systems need to reach workers outside government services, in formal and informal enterprises, and in urban and rural areas. In some instances, governments will need to partner with the private sector to develop pension systems that can offer broader coverage. This process will not be easy or cheap, or necessarily readily sold to either younger or older members of the public. Both have vested interests—the former in minimizing tax burdens, and the latter in increasing or maintaining high benefit levels. Heavy debt burdens that destabilize the economy do not benefit any group. It is particularly critical to reach workers in lower-income groups, including those in the informal sector and rural areas, who are unable to contribute to pension plans or set aside income. Potential measures include social security programmes and non-contributory pension schemes. While these systems are in place in the region, the financial support they offer is extremely small and needs to increase, especially towards the goal of ending poverty among older persons. Make pension systems sustainable. As countries begin to expand pension systems, attention will need to be paid to design and long-term sustainability. Choices will arise around balancing priorities across generations. It will be important to develop social consensus around what constitutes a fair share. Pension systems, in general, are complex and often controversial, given multiple possibilities for managing funds, investments and returns. Some countries have been successful in finding a way forward. Denmark’s highly rated pension system, for example, offers stable and adequate benefits to its retirees through a strategy where nearly 80 percent of funds are invested in bonds. In many Asia-Pacific countries, a serious discussion needs to begin around how to start saving for pensions, and to what extent working-age people should be saving now. Should governments develop large welfare systems as in Europe or parts of Latin America; call on people to rely more on the accumulation of personal assets as in Indonesia, the Philippines and Thailand; or use a combination of these strategies? Broadly, pension systems should aim to be progressive, where benefits are equitably shared, and those with the capacity to contribute more do so. A fair floor of essential benefits could be established for all pensioners. Increasing contribution rates to soften the fiscal burden of Pension systems should aim to address the simultaneous challenges of coverage, adequacy and sustainability 145
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ASIA-PACIFIC HUMAN DEVELOPMENT REPO
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ASIA-PACIFIC HUMAN DEVELOPMENT REPO
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FOREWORD We live in times of great
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ACKNOWLEDGEMENTS The Asia-Pacific H
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Table of Contents Foreword iii Pref
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1.15 Population age-composition is
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Acronyms ADB Asian Development Bank
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Overview SHAPING THE FUTURE: HOW CH
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HUMAN DEVELOPMENT IN ASIA-PACIFIC:
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FIGURE 2: Wealthier countries tend
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a strong emphasis on protecting wor
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could provide job matching assistan
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Asia-Pacific leave the workforce at
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WHAT’S AHEAD IN THIS REPORT This
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Chapter 1 HOW CHANGING DEMOGRAPHICS
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sustainable, reaching everyone whil
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FIGURE 1.1: The Human Development I
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TABLE 1.1: Asia-Pacific still has l
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married couples to have children, a
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FIGURE 1.5: Population pyramids in
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FIGURE 1.8: The median age is high
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FIGURE 1.10: Disparities in fertili
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Improved overall human development
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TABLE 1.5: Countries in Asia-Pacifi
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“When relatively large generation
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38 Having fewer dependents on worki
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40 In developed Asia- Pacific, the
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TABLE 1.6: Demographic dividends fl
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44
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2. MORE PEOPLE AT WORK: THE FOUNDAT
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encouraged labour-intensive industr
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FIGURE 2.3: Peaks within subregions
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A DEMOGRAPHIC RETURN FOR HUMAN DEVE
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BOX 2.1: Women bear a larger burden
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FIGURE 2.8: Growth in labour produc
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WHAT’S BEEN LEARNED IN CHINA, JAP
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FIGURE 2.13: Japan is past its work
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FIGURE 2.15: Thailand still has tim
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make this a key aim of national dev
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investment climate, as well as enco
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TABLE 2.4: Shares of workers in the
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Even before leaving home, migrant w
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Promote health and safety at work:
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BOX 2.8: Malaysia transforms an ind
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of resilient infrastructure are joi
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Chapter 3 NURTURING CHILDREN, UNLOC
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Asia-Pacific is home to 1.7 billion
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Commendable progress in education m
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Quality primary education mitigates
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In most Asia-Pacific countries, sec
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Strong tertiary education is a buil
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FIGURE 3.3: Access to tertiary educ
Page 108 and 109: 94 TABLE 3.9: Youth illiteracy has
Page 110 and 111: TABLE 3.11: Child mortality rates b
Page 112 and 113: BOX 3.7: Malnutrition and disabilit
Page 114 and 115: Despite social and economic progres
Page 116 and 117: FIGURE 3.8: The share of youth who
Page 118 and 119: 104 Young migrants are highly vulne
Page 120 and 121: as an important challenge. But they
Page 122 and 123: TABLE 3.15: Some countries with lar
Page 124 and 125: Immunization saves children’s liv
Page 126 and 127: BOX 3.10: Germany’s vocational tr
Page 128 and 129: BOX 3.12: Partnering with youth in
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Page 133 and 134: 4. AGEING SOCIETIES: NEW OPPORTUNIT
Page 135 and 136: FIGURE 4.1: Asia-Pacific is one of
Page 137 and 138: TABLE 4.1: East Asia is the oldest
Page 139 and 140: BOX 4.2: Responses to poverty among
Page 141 and 142: BOX 4.3: A plan of action for older
Page 143 and 144: FIGURE 4.9: Per capita health-care
Page 145 and 146: BOX 4.5: China moves towards univer
Page 147 and 148: TABLE 4.3: Social pensions are an i
Page 149 and 150: FIGURE 4.12: Pension replacement ra
Page 151 and 152: BOX 4.7: Increasing links between p
Page 153 and 154: cupy space in some public buildings
Page 155 and 156: ment bodies, encourage regular inte
Page 157: BOX 4.9: Ageing countries begin enc
Page 161 and 162: for older people. Many advanced cou
Page 163 and 164: action. Free public transport, and
Page 165: Chapter 5 TAPPING THE HUMAN DYNAMIS
Page 168 and 169: In the last 30 years, Asia-Pacific
Page 170 and 171: FIGURE 5.3: Even countries with few
Page 172 and 173: FIGURE 5.6: Most people will contin
Page 174 and 175: 160 Social, cultural and economic i
Page 176 and 177: The benefits of urbanization have n
Page 178 and 179: BOX 5.2: Pioneering urban poverty r
Page 180 and 181: vehicles on the road. Beijing issue
Page 182 and 183: Municipal governments in Asia-Pacif
Page 184 and 185: TABLE 5.4: Revenue mobilization opt
Page 186 and 187: 172 City governments need to have t
Page 188 and 189: Investing in essential infrastructu
Page 190 and 191: 176 in East Asian cities, and occur
Page 192 and 193: BOX 5.9: The Republic of Korea emba
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Page 197 and 198: 6. AN AGENDA FOR ACTION: SHAPING TH
Page 199 and 200: Development Report argues, decent w
Page 201 and 202: with ministries overseeing youth, e
Page 203 and 204: This is an urgent priority in a reg
Page 205 and 206: SUSTAINING HUMAN DEVELOPMENT ACROSS
Page 207 and 208: plan automatically enrols people in
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BOX 6.3: Developing Delhi’s metro
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End Notes CHAPTER 1 1. UNFPA 2014b.
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63. WHO 2014b. 64. UNFPA 2012. 65.
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produces 40 percent of total econom
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206 The Asia Foundation. 2013. “T
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208 CODI (Community Organizations D
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210 Global Migration Group. 2014.
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212 Janwani. 2010. “Annual Report
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214 ———. 2012a. OECD Employme
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216 ———. 2011. “Follow-up t
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218 York. [www.unfpa.org/sites/defa
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———. 2012c. Malaysia Economic
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tables include the Caribbean countr
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TABLE 2: Trends in the Human Develo
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TABLE 4: Gender Inequality Index 22
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TABLE 6: Trends in income poverty,
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TABLE 8: Fertility rate and crude d
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TABLE 10: Trends and share of child
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TABLE 12: Trends and share of young
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TABLE 14: Trends and share of older
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TABLE 16: Education indicators and
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TABLE 17: Health indicators 242
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TABLE 18: Employment and unemployme
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TABLE 19: International trade, fina
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ABOUT ASIA-PACIFIC HUMAN DEVELOPMEN
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SHAPING THE FUTURE HOW CHANGING DEMOGRAPHICS CAN POWER HUMAN DEVELOPMENT

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