Pension systems of Asian countries face reform pressure

WEDGED between decreasing fertility rates at one end and growing life expectancy at the other end of the age spectrum, pension reformers find themselves in a demographic tight spot.

By 2100, Singaporean men and women can expect to live to the ripe old age of 90 and 97 years respectively - an increase of roughly 10 years compared to the life expectancy of those born today. The girls and boys born in China, Thailand and Japan in 2100 can expect to lead similarly long lives. Meanwhile, fertility rates are decreasing across the region, leading to shrinking workforces and ageing societies. In short, many retirement schemes are in urgent need of reform.

Reform pressure is heightened by the fact that many Asian societies are not only ageing, but doing so rapidly. France, for example, took more than 140 years to increase its share of population over 65 from 7 per cent to 21 per cent, giving policymakers time to find out what works and what doesn't. South Korea takes a mere 30 years to go through the same process. Similarly, Singapore, Thailand and Vietnam are all competing for the dubious title of becoming the world's fastest ageing country.