Why Philippines is 'exempted' from problem of aging population

Posted at 08/07/2014 5:52 PM

MANILA, Philippines - The Philippine economy can expect to get a boost from a "young population" at least for the next two decades, a
study by Moody’s Investors Service showed.

According to the study, the Philippines is among 23 countries out of a total of 112 nations surveyed that are exempted from the problem of aging population plaguing much of the world, at least until 2030.

An aging population means at least 7 percent of the population is aged 65 years old or higher. This means fewer members of the work force.

The report showed the elderly in the Philippines is estimated to be around 4.1 percent of the total population by 2015. The percentage of elderly people is expected to grow to 4.9 percent by 2020; 5.6 percent by 2025 and 6.3 percent by 2030.

"Countries with slow, gradual aging processes are likely to be better able to gradually adjust policy than countries with rapidly aging populations that require dramatic policy changes over a short period," Moody's said.

Moody's expects 68 of its 112 rated countries to start "aging" next year.

Three countries, Germany, Japan and Italy, are already under the "super-aged" category, which means more than 20 percent of their populations are composed of elderly. Two more countries, Finland and Greece, will become "super-aged" by 2015.

"The unprecedented pace of aging will have a significant negative effect on economic growth over the next two decades across all regions," it said.

By 2020, 13 countries will be in the "super-aged" category, which will include Bulgaria, Croatia, France, Malta, the Netherlands, Portugal, Slovenia, and Sweden.

However, Moody's noted some emerging markets are already classified as "aging", such as Argentina, Brazil, Chile, China, Russia, Thailand, and Turkey.

"The rate of aging in these countries is considerably more rapid than in some of the developed economies... Looking ahead, by 2050, there are expected to be two working adults for every adult over 65 in developed countries and four working adults for every adult over 65 in the developing world," it said.