Asia and Europe face the challenge of aging populations due to declining rates of fertility and longer life expectancy, with concomitant concerns about the socio-political and socio-economic consequences. Asia is said to be in an earlier transition phase with diverse fertility and aging patterns, alongside rapid urbanisation and economic growth, while Europe is more advanced in demographic change with persistent low fertility and population decline, partially mitigated by migration.
In Asia, with over 4.8 billion people or 60% of the global population, demography is changing at different speeds across the region. Countries, such as China, Japan and South Korea, are among the fastest-aging countries, while other countries, such as Cambodia, Indonesia, Lao PDR and the Philippines still have large youth populations. The youths offer “demographic dividend” if supported by investment in education, employment and healthcare, but could lead to higher youth unemployment and lower productivity without proper planning. According to Eurostat, between 2002 and 2022, the proportion of people aged 65 and above in the EU rose from 16% to 21%, while the share of young people fell from 23% to 20%. In 2023, fertility rate fell to a record 5.4% decline in births.
The outcome of such trends can be serious, including labour shortages, lower competitiveness, higher pension (eg Italy and Greece) and healthcare costs, and higher youth unemployment. The countries are responding in various ways, such as through investment in automation and AI, including in elder care (eg China and Korea), use of migrant workers (Germany and Italy) and policy changes to restrictions on the number of children and provision of monetary incentives to defray hospital and childcare costs (eg Vietnam, China and Japan). The European Commission introduced the EU Demography Toolbox in 2023 to support families, youth, older people and migration management.
These measures have their own difficulties. In Europe, uneven urban growth and integrating migrants into urban life remain complex. Political resistance in some contexts has contributed to a shift towards more restrictive immigration policies. Urbanisation also risks hollowing out small towns and straining of infrastructure in cities. They will need to address the underpinning drivers of demographic change, including significant improvement in education, especially for women and increased female workforce participation, labour migration and steady increases in life expectancy.
Sources:
SilverEco, 25 February 2025, South Korea faces an unprecedented demographic crisis, SilverEco
https://www.britannica.com/topic/one-child-policy
This is the EU country where babies born to migrants outnumbered local newborns | Euronews
Eurostat, Demography of Europe – 2023 Edition, European Commission
Nik Martin, 16 August 2024, Aging Europe: Rising costs threaten EU pensions, DW
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