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Why demographic change requires a new set of cards

14 December 2021

Decreasing birth rates are shining a light on Asia’s economic sustainability. In response, many governments are considering incentives to encourage larger families. These evolving policies will be vitally important, as the region looks to sustain a fast-greying population. Asia’s demographic trends may be broadly consistent, but different factors are in play depending on the birth rates and population goals in individual countries or markets.

 

 

Here are some interesting demographic numbers.


-0.5 Japan
 
The need to reverse Japan’s falling fertility rate
 
In 2020, there was another dip in Japan’s fertility rate to 1.34 (around 0.5 below the government’s target of 1.8 by 2025), which is among the lowest in the world. This ongoing weakness only adds to existing concerns about the damage this decline is having on the economy.

13% Thailand
 
Thailand’s shrinking workforce
 
Thailand’s population is ageing rapidly, and the trend shows no sign of abating. The number of people aged 65 or older is projected to rise from 13% at present to 31% in 2060. Should this increase prove accurate, it could cut 0.86% from the country’s economic growth in the 2020s.
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2=SGD 31,000 Singapore
 
Improved baby bonus in Singapore
 
Among the steps being taken in Singapore to halt a decreasing fertility rate is an increase in the baby bonus paid by the government on the birth of a second child. Eligible couples receive a cash gift and a development account that parents can match dollar for dollar. This account can be used to fund the child’s education and healthcare expenses. The terms of these payments were enhanced to as much as SGD 31,000 in 2021 as an incentive for families to have two children.

12 million China
 
China now allows three-children families
 
Census data in China showed that around 12 million babies were born in 2020, a notable fall from 18 million in 2016. Of greater concern is the fact that it was the lowest number of births recorded since the 1960s. Some observers believe that the main deterrent is the high cost of raising children in cities. Nevertheless, some people have decided to give birth a second time, and a further policy change targets this group. In May 2021, China increased the permitted number of children to three.

2 India
 
India looking to limit childbirth rates
 
India’s two most populous states have taken steps to ensure that families have no more than two children. In its largest state, Uttar Pradesh, where population density is more than double the country’s average, the state government is proposing legislation that would mean couples with more than two children would be denied benefits or subsidies. What’s more, they would be prevented from working for the local authority. A range of incentives is available to couples who sign up for sterilisation, including financial assistance to help buy or build a home.

3 Indonesia
 
Indonesia seeks birth reductions
 
Similarly, Indonesia also sees growth in its population. At present, the fertility rate is three children per woman. The government wants to bring that number down to an average of 2.1 by 2025. In response, the authorities are looking at measures that will reduce current numbers. These include family planning initiatives and improved contraception, as well as encouraging people to delay marriage until later in life.

14 December 2021

Decreasing birth rates are shining a light on Asia’s economic sustainability. In response, many governments are considering incentives to encourage larger families. These evolving policies will be vitally important, as the region looks to sustain a fast-greying population. Asia’s demographic trends may be broadly consistent, but different factors are in play depending on the birth rates and population goals in individual countries or markets.

Here are some interesting demographic numbers.

-0.5 Japan

The need to reverse Japan’s falling fertility rate


In 2020, there was another dip in Japan’s fertility rate to 1.34 (around 0.5 below the government’s target of 1.8 by 2025), which is among the lowest in the world. This ongoing weakness only adds to existing concerns about the damage this decline is having on the economy.

13% Thailand

 

Thailand’s shrinking workforce


Thailand’s population is ageing rapidly, and the trend shows no sign of abating. The number of people aged 65 or older is projected to rise from 13% at present to 31% in 2060. Should this increase prove accurate, it could cut 0.86% from the country’s economic growth in the 2020s.

2=SGD 31,000 Singapore

 

Improved baby bonus in Singapore


Among the steps being taken in Singapore to halt a decreasing fertility rate is an increase in the baby bonus paid by the government on the birth of a second child. Eligible couples receive a cash gift and a development account that parents can match dollar for dollar. This account can be used to fund the child’s education and healthcare expenses. The terms of these payments were enhanced to as much as SGD 31,000 in 2021 as an incentive for families to have two children.

12 million China

 

China now allows three-children families


Census data in China showed that around 12 million babies were born in 2020, a notable fall from 18 million in 2016. Of greater concern is the fact that it was the lowest number of births recorded since the 1960s. Some observers believe that the main deterrent is the high cost of raising children in cities. Nevertheless, some people have decided to give birth a second time, and a further policy change targets this group. In May 2021, China increased the permitted number of children to three.

2 India

 

India looking to limit childbirth rates


India’s two most populous states have taken steps to ensure that families have no more than two children. In its largest state, Uttar Pradesh, where population density is more than double the country’s average, the state government is proposing legislation that would mean couples with more than two children would be denied benefits or subsidies. What’s more, they would be prevented from working for the local authority. A range of incentives is available to couples who sign up for sterilisation, including financial assistance to help buy or build a home.

3 Indonesia

 

Indonesia seeks birth reductions


Similarly, Indonesia also sees growth in its population. At present, the fertility rate is three children per woman. The government wants to bring that number down to an average of 2.1 by 2025. In response, the authorities are looking at measures that will reduce current numbers. These include family planning initiatives and improved contraception, as well as encouraging people to delay marriage until later in life.

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Important notice

If you are having problems viewing fund information, please clear your browser cache and try again. Click here for information on how to clear the cache on your browser.

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Effective Tuesday, May 3, our Customer Service Centre at Manulife Financial Centre, Kwun Tong will resume normal operating hours: Monday to Friday, 9am to 6pm. 

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