Ageing societies to drag growth in Asia: IMF

Studies show that Asia’s population is ageing faster than anywhere else in the world, with Japan forecast to become the first “ultra-aged” country, meaning 28% of the population is 65 or over, while a fifth of the people in South Korea are expected to be 65 by 2030. 

Rapidly ageing countries including China, Japan, Korea and Thailand “will have smaller workforces in the future and potentially lower productivity growth”, IMF managing director Christine Lagarde told a conference in Seoul. “We estimate that these countries could face lower annual GDP growth... by up to a percentage point,” the IMF chief said.  

China and Japan are the world’s second- and third-largest economies respectively, and slower growth in them risks having significant knock on effects around the world. Lagarde urged governments to “boost the proportion of women in the workforce” by better accommodating working mothers with more childcare benefits and incentives for part-time work. 

In emerging countries such as India – where populations are still growing – better education for girls and wider access to finance for women should be prioritised, she said. 

According to some estimates, she added, closing the gender gap in the employment market could raise Japanese GDP by 9%, South Korea’s by 10%, and India’s by 27%. At the conference, Bank of Korea Governor Lee Ju-Yeol also called for steps to tackle low birth rates and create more jobs for women and older people.