Ageing is Increasingly Evident in China: S&P

By the midpoint of the century, the disproportionate growth in the number of elderly people in China will put the nation’s public finances under pressure as it experiences one of the most dramatic demographic shifts in history, according to a new study of global aging trends by US credit-rating firm Standard & Poor’s.

Released on Tuesday, the report, Global Aging 2013: Rising to the Challenge, notes that by 2050, China will be caught between a huge jump in the number of older citizens depending on young workers to keep the country functioning and a declining birth rate that will gradually shrink the work force. Within two decades, the deterioration in the demographic profile will be evident, said report author Marko Mrsnik.

“China is facing quite a significant demographic shift, which I think it can gradually defuse, but it has to start thinking about it now,” said Mrsnik, S&P’s director of sovereign ratings.

The report shows that in 2010, China had a population of 1.34 billion and an old-age dependency ratio – the number of people aged over 65 relative to the population aged 15-64 – of 11 percent. By 2050, the population is projected to fall to 1.29 billion while the dependency ratio soars fourfold to 42 percent, according to the study.

By 2030 the dependency ratio will have doubled from 2010, to 24 percent, Mrsnik said. “That’s a very significant deterioration in the demographic profile,” he said, adding that “this rapid shift is already under way”.

“The pressures will be gradually building up and, especially in 2020, we will see that putting more pressure on the public purse.”

By highlighting the consequences of the declining birth rate, S&P’s report could refocus attention on the debate over the future of China’s family planning policy. The government introduced the restriction in 1979 to limit births in the world’s most populous country, but the policy is now undergoing scrutiny because of challenges a rapidly aging population poses to China’s economic competitiveness. The National Population and Family Planning Commission has estimated that the policy has prevented 400 million births.

China has already taken one step to change its family planning policies. Last week during the central government’s annual two sessions, China’s new government merged the National Population and Family Planning Commission with the Health Ministry.

Mrsnik noted that there is an advantage in having a policy the nation can adjust to control the impending demographic shifts.

“You actually have policy flexibility, which is something that other countries like European economies don’t have,” he said.

Although Zhang Weiqing, former head of the National Population and Family Planning Commission, said in November that China was considering changing the 34-year-old policy, he said reforms were unlikely to happen fast.

The United States also is bracing for a dramatic demographic shift as its population ages, but the change is projected to be less severe than in China, according to the S&P study. Between 2010 and 2050, the US population is forecast to grow to 403.1 million from 310.4 million, while the old-age dependency rate increases 1.5 times to 35 percent from 20 percent.

Michael Hodin, executive director of the Global Coalition on Aging, a group of industry leaders engaged in the global aging discussion, said the S&P report dramatizes how China’s economic growth spurt makes it important to tackle the dilemma of an aging population quickly.

“There’s a different proportion of old to young, living longer and low birth rates, which have enormous consequences for fiscal sustainability, social structure and economic growth,” Hodin said. “And to the degree that those analytics describe the Chinese makeup, the impact to China’s fiscal sustainability and economic growth over the next two to four decades is very, very consequential.”

Source: China Daily

Latest Developments

We keep our members and partners in touch with the most recent updates and opinions in the worldwide dialogue on population longevity and related issues.

What Old Age Might Be Like for Today’s 30-Year-Olds

Get ready for a new old age. With the U.S. fertility rate in a decadelong slump and the life expectancy of 65-year-old Americans approaching roughly 85, our aging nation is likely to grow older by midcentury, as the ratio of young to old continues to decline. The trend is likely to upend how our society is organized, making life very different for today’s 30-year-olds when they reach their 60s compared with life for 60-year-olds now.

World Population Reaches 8bn As It Grows Older

The world’s population reached 8bn people on Tuesday and will hit 9bn in 15 years as it experiences an unprecedented surge in the number of older people, according to the latest UN data. The global fertility rate has more than halved since the 1950s to 2.3 births per woman. With mortality also falling, the number of people aged 65 and over is expected to rise from 783mn in 2022 to 1bn by 2030 and reach 1.4bn by 2043, the UN population data revealed.

Global Coalition on Aging (GCOA) Launches Cross-Sector Alliance Committed to Health Innovation at High-Level Forum on The Silver Economy

Today, the Global Coalition on Aging (GCOA), along with cross-sector stakeholders representing patient advocacy, policy, industry, and academic communities, announced the launch of the Alliance for Health Innovation at the High-Level Forum on the Silver Economy in New York. The Alliance is dedicated to establishing the importance of innovation in achieving healthy aging and health equity through investments, policy reforms, and strategic partnerships.

Japan Must Face Up to Growing Danger of Drug-resistant Germs

In the wake of more than 6.4 million COVID-19 deaths worldwide and unprecedented economic destruction, the global community has no excuse to be caught unprepared for the next pandemic. Yet right now, a devastating parallel plague is already underway and worsening. Some years, it is killing well over 1 million people, according to medical journal The Lancet.

A Bipartisan Bill Could Prevent The Next Pandemic

In Washington, Republicans and Democrats are typically at loggerheads when it comes to healthcare policy. Just consider the recent Inflation Reduction Act, which made extensive changes to Medicare and also extended Affordable Care Act subsidies. Every single congressional Democrat voted for the legislation, while every single member of the GOP voted against it. But occasionally, a bill is such an obviously good idea, and so desperately needed, that it commands significant bipartisan support. The PASTEUR Act, co-sponsored by 31 Democrats and 31 Republicans in the House and two members of each party in the Senate, is just such a bill.

Korea Must Act Now to Combat Growing AMR Threat

Public officials are overlooking one of the gravest long-term threats to the Korean people, the health system, and economy: antimicrobial resistance (AMR). Some pathogens ― bacteria, fungi, parasites, and viruses ― have evolved strains that resist the antimicrobial medications we currently have available to fight them. Health care professionals often must watch helplessly as patients succumb to infections that antibiotics could once have easily beaten. They know that new antimicrobials, including and especially antibiotics, could easily gain the victory ― but they have none at their disposal.

Policy Statement on the Impact of Price Negotiations on Innovation, Healthy Aging and Equity

As the CEO of the Global Coalition on Aging (GCOA) and a newly formed cross-sector Alliance for Health Innovation, we write to express our deep concern with the current legislation that allows for price “negotiations” in Medicare – a thinly veiled signal for America’s plunge into price controls that will have a devastating and adverse impact on biopharmaceutical innovation and our nations’ ability to support healthy aging.