THE country’s demographic situation, which relates, among others, to the number, health, age and economic circumstance of Filipinos, should continue to support its growth over the next two decades even as peer economies in the region and elsewhere begin to slow down, according to the sovereign credit watcher Moody’s Investors Service.
Moody’s particularly said the Philippines is one of 23 countries around the world considered exempt from so-called population pressure between this year until 2030, when the collective age of Filipinos is at that point when they contribute the most and, for long, to local output measured as the gross domestic product (GDP).
Moody’s said the demographic dividend that drove the economic expansion of most countries in the recent past will take a toll on many countries across the globe in the near future, and may ultimately slow their economic expansion during the period.
By next year, for example, some 60 percent of Moody’s-rated countries will be classified as “aging,” or one whose citizens aged 65 years or older already exceed 7 percent of total population.
The Philippines is classified under the “not-aging category” consistently from 2015 up until 2030, which means that the share of the elderly population to the total number of people in the country will remain below 7 percent all throughout.
Compared to neighbors like Thailand, Malaysia, Indonesia and Singapore, the Philippines has optimum status in demographic terms, according to Moody’s.
In particular, Moody’s said Thailand will start aging from 2015 to 2020 and will be considered a country with an ‘aged’ population by 2025. For Malaysia and Indonesia, both countries’ population will still be at its prime in 2015 to 2020, its population considered “not aging” in the next six years. But, from 2020 to 2025, however, Malaysia and Indonesia should start to age in population, according to Moody’s.
Singapore anticipates a fast decline in its working-class population in the years ahead as Moody’s estimates the country to start aging by 2015 to 2020. Singapore will then have an “aged” population by 2025 and seen super aged by 2030.
“Given demographic changes, we should expect lower potential aggregate growth rates in many of the countries that will experience dramatic reductions in the size of their labor force,” Moody’s said.
Moody’s said policy reforms in the medium term will help improve labor participation in aging populations, spur immigration in a country and encourage financial inflows to mitigate the impact of a diminishing labor force in economic growth.
“Innovation and technological progress that improve labor productivity and human capital can also dampen the effects of the rapid demographic changes on economic growth over the long term,” Moody’s said.
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