A report by the International Monetary Fund (IMF) predicted that the Philippines will be the youngest country in Asia in the next several decades, and recommended that the country diversify its key services and manufacturing sectors to enhance the productivity of its workforce and maintain its status as one of the fastest growing economies in Asia.
“In the next 30 to 40 years, the Philippines is going to be the youngest nation in Asia. That’s a huge opportunity … not only because we are young, but it’s also because others are going to be old, especially our neighbors in Asia,” said Shanaka Peiris, a representative of the IMF at the Economic Journalists Association of the Philippine (EJAP) in Manila.
“That’s a big opportunity. But that alone will not be enough because a demographic dividend would need jobs. We have to create the jobs,” added Peiris.
The Philippines is the second most populous country in ASEAN and it is estimated that it will grow from 98 million to over 154 million by 2050.
The Philippine’s economy has maintained a growth rate of over 5% on average over the past decade, and its GDP expansion of 7.2% was one of the strongest in Asia in 2013. But while unemployment has improved recently, it is still high at 6.7% compared to 7.3% in 2013.
Development in the private sector is the answer to the problem, according to Peiris. “We need the private investment to fall in line. We need the demographic dividend by creating jobs. That’s where we need to diversify the economic sector. And also addressing some of the bottlenecks.”
Neighboring countries in ASEAN (The Association of Southeast Asian Nations) have shown a trend of aging that is expected to continue for the foreseeable future. Malaysia, for example, will have more than three times the population of those 65 and older than they currently have by 2040. Vietnam’s average birthrate rapidly declined from 6.4 children per mother during the 1960s to just 2.06 in 2014, and the country faces an aging crisis because of this.