People walk along a street market in Quiapo, in Manila, Philippines, July 11, 2023. REUTERS/Eloisa Lopez/File Photo
MANILA — The Philippines will continue to enjoy the benefits of having a legion of young working-age population in the next 40 years, Amro said on Monday, marking the country safe from a looming demographic winter in the Association of Southeast Asian Nations (Asean+3) that could cool the region’s economy.
The Philippines’ population is forecast to peak in 2092, the longest among the nine Southeast Asian countries and the so-called “Plus-3” nations—namely China, Hong Kong, Japan and Korea—Asean+3 Macro Research Office said in its flagship regional economic outlook report.
That means the archipelago will see the apex of its working-age population in 2051. As of 2021, Amro said the Philippines’ median age stood at 24.5 years old, the second youngest in the region after Laos’ 23.8 years.
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Overall, the Philippines, Laos and Cambodia are the only countries in Asean+3 in “early transition,” which is marked by high—but slowly declining—fertility rates. Data from the Philippine Statistics Authority showed the country’s fertility rate hit the replacement level of 2.1 babies born per woman in 2020.
Financing woes
That is a stark contrast to China, which reached the highest level of population growth in 2021. Amro said Thailand would be the first in Asean to reach its population peak—projected around 2030. Already, eight of the region’s economies are considered “aging” societies as of 2023, with people aged 65 and above comprising 7 to 14 percent of the total population.
Unless more people decide to have babies, a shrinking working-age population would make it hard for countries to finance rising pension and health costs brought by the projected increase in old people. This, Amro said, would change how economies in Asean+3 would perform in the long-term.
In the report, Amro retained its growth forecast of 6.3 percent for the Philippines in 2024, while projecting a faster gross domestic product expansion of 6.5 percent in 2025.
READ: AMRO cuts PH 2024 GDP growth forecast to 6.3%
“As aging influences the trajectory of economic growth, concerns are rising that the ongoing demographic transition will impede Asean+3’s ability to sustain its long-term growth trajectory,” Amro said.
View of aging
“This arises from a chronological view of aging: as the economy grows older, it is moving toward a situation where more people are consuming goods and services while fewer people are producing them,” it added.
Meanwhile, Amro said half of the region’s economies were in “advanced transition”—or those that have been able to largely reap the demographic dividend and have seen the share of their working populations peak in the past 20 years.
In the next decade, Amro predicted that six Asean+3 countries would likely be “super-aged” or those with 21 percent of the population over the age of 65 needing pensions and more health benefits.
But Amro said life expectancy globally, including in the Asean+3, had increased by over 20 years since the 1980s—thanks to significant progress in medicine, health care, technology, education, and economic development. INQ