Live long and prosper: aging in East Asia and Pacific

Live long and prosper: aging in East Asia and Pacific

As a region, East Asia and Pacific is ageing rapidly. The region is home to over a third of the global population ages 65 and older—mostly in China—and to more old people than any other region. More significantly, the region is ageing more rapidly than any region in history—a trend driven both by sharp declines in fertility and by steady increases in life expectancy—and in many countries, aging is occurring at relatively low-income level.
 
This report finds that East Asia and Pacific is well positioned to manage the risks from ageing. First, people in the region already have long working lives. Second, entitlements to pensions, health care, and long-term care for most of the population are still modest, and there is scope to act now to put in place systems that can be sustainable in the future. Third, household savings in the region are already high, and people tend to save until later in life, suggesting that they may be better prepared for old age. Finally, people in East Asia and Pacific have in recent decades seen a steady increase in the number of years
lived in good health.
 
The key message of the report is that it will be possible to manage rapid ageing in East Asia and Pacific while sustaining economic dynamism. This effort will require politically difficult policy choices, including dealing with associated fiscal risks. Several complementary policy reforms are required to manage these risks.
 
Pension systems will need reform. Formal sector pension schemes will need to be more fiscally sustainable, which will require reforms such as gradual increases in the retirement age.
 
In the health sector, the impacts of ageing will likely be significant, particularly given the increased incidence of noncommunicable diseases. This trend underscores the urgency to shift from a hospital-centric model to one in which primary care plays a bigger role and in which the treatment of older patients with chronic conditions is managed afford-ably at the right levels of the system.
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