Asia, a continent renowned for its dynamic economies and diverse cultures, is currently at the epicenter of a seismic shift in its demographic landscape. Accounting for approximately 60% of the world’s population, Asia is navigating the complex challenges posed by low fertility rates and rapid population ageing, reshaping the economic and social fabric of the region.
Dr. Toshiko Kaneda, the Technical Director of Demographic Research at the Population Research Bureau in Washington, D.C., underscores the magnitude of this transformation. The once-powerful manufacturing hubs of China, Japan, South Korea, and Taiwan are now grappling with unprecedented population ageing, marking a critical juncture in Asia’s demographic evolution.
In 1990, only five countries in the Asia-Pacific region had fertility at or below replacement levels. Fast forward to 2022, and 17 countries are now facing below-replacement fertility, with projections indicating that nearly all countries in the region will follow suit by 2050. This rapid decline in fertility rates has ushered in a significant increase in the share of older adults, a direct consequence of having fewer children, according to Dr. Kaneda.
The demographic divergence is stark. While East and Northeast Asian countries contend with the challenges of ageing populations, nations like India, Indonesia, Bangladesh, the Philippines, and Vietnam boast youthful demographics, comprising the majority of the world’s population. Poonam Muttreja, Executive Director of the Population Foundation of India, notes the emergence of an intriguing interplay between ageing giants and youthful contenders, reshaping the economic and social landscape of the continent.
Japan, the harbinger of an ageing population, serves as a poignant example. In 1999, it became the first major country to surpass a median age of 40, and in 2023, it still holds the record with a median age of 48.4. Japan’s demographic landscape underscores the need for policies focusing on healthcare, pension systems, and age-friendly infrastructure, as articulated by Muttreja.
China, South Korea, and Taiwan are not far behind in facing the challenges of ageing populations, impacting areas such as military staffing, public finances, and the imperative need for higher productivity from a shrinking working-age population. Muttreja highlights China’s struggles with a declining population and a skewed sex ratio due to its former one-child policy, emphasizing the long-term implications of stringent population control measures.
Contrastingly, India recently surpassed China as the world’s most populous country, with a median age of 28.7. However, this youth bulge poses a dual challenge for India and its South and Southeast Asian counterparts—creating sufficient employment opportunities for the expanding workforce and attracting global investments to avoid a demographic dividend turning into an unemployment crisis.
Muttreja emphasizes the need for strategic investments in education, healthcare, and skilling to harness the demographic dividend. Additionally, she underscores the potential for a “gender dividend” in South Asia through the empowerment of women and girls in the workforce, emphasizing the importance of addressing gender disparities in education, employment, and health.
A complex interplay of economic shifts and geopolitical dynamics is underway. South Korea’s notable increase in visas for migrant workers and the trend of manufacturing shifting from ageing powerhouses to youthful nations, such as Vietnam, exemplify this evolution. The symbiotic relationship between industrial giants like Samsung and Vietnam’s youthful labor force illustrates the interconnectedness among nations.
Yet, significant challenges loom. South Korea anticipates a staggering 35% reduction in its working-age population by 2050, and China expects a 20.6% reduction. Dr. Kaneda warns that by mid-2040, there will be more older adults than children and youth under age 15 in Asia Pacific. The question becomes urgent: how can Asia maintain a robust workforce and address the consequences of an ageing population?
One potential solution is immigration, embraced by some regional states like Australia, New Zealand, and Singapore. However, Northeast Asian states, including Japan, South Korea, and Taiwan, have been hesitant to implement immigration programs on a significant scale. As a result, the changing demographics within Asia are fostering interconnectedness among nations, creating both opportunities and challenges for collaboration and competition.
Asia’s demographic diversity, from Japan’s ageing population to India’s youth bulge, offers valuable lessons. Collaborative learning among nations could pave the way for effective strategies to manage their unique demographic challenges. As Asia navigates this transformative period, the interconnectedness of its states provides a platform for shared growth, competition, and, most importantly, the collaborative resolution of demographic challenges.