Economists say Cambodia is not facing the risk of an aging population, as is happening in richer countries around the region, but it must still plan for a future when its younger generations grow old.
World Bank economist Philip O’Keefe, lead author of a new report, “Live Long and Prosper: Aging in East Asia and the Pacific,” says Cambodia needs to begin thinking about a pension policy and providing quality education to ensure its citizens remain competitive in coming decades.
“You have to really move up the education curve, once you can now, because by the time you get to an aged society, if your average young person has not already had senior secondary education at least, you’re not going to be competitive at that point,” he said.
Cambodia could consider policies in the labor market and other areas to help people age with prosperity, he said, such as not having mandatory retirement age.
In its report, the World Bank notes that richer Asian countries, like Japan, Singapore and South Korea, are “advanced agers,” with 14 percent of their populations or more already older than 65. Developing middle-income countries, such as China, Thailand and Vietnam, are already aging quickly and face of the most pressing challenges, the report says. Cambodia, Laos and Papua New Guinea, meanwhile, have only around 4 percent of their population over 65. However, those demographics will change in the next 20 to 30 years.
The report recommends that developing countries in East Asia “take steps to reform their existing pension schemes, including considering gradual increases in retirement age.” For countries with relatively young populations, the report suggests that “governments take future rapid aging into account and put in place sustainable pension systems.”
Phay Siphan, spokesman for the Council of Ministers, told VOA Khmer Cambodia is working on reforming its pension system. “We have improved a lot by raising the level of pension payments, meaning we don’t give up on people. We increased it by relying on equity with those who are active.”
The World Bank report says that “36 percent of the world’s population ages 65 and over, or 211 million people, live in East Asia, the largest share among all regions. By 2040, the graying of the population could shrink the number of working-age adults by more than 15 percent in Korea and more than 10 percent in China, Thailand, and Japan. In China alone, that would translate into a net loss of 90 million workers.”