• The world’s population is ageing

• Population aged 60 or over is the fastest growing

• Malaysia’s demographic crisis

• Changes in the age structure of the Malaysia population

• What does this mean from an economic perspective?

• The economics of an ageing population

We are getting old. The statistics show Malaysia's inevitable march towards a difficult milestone - that of an ageing nation.

Over the next few decades, Malaysia’s population structure is expected to face a dramatic shift, as the country begins to follow the global trends of an ageing population.

The world’s population is ageing Virtually every country in the world is experiencing growth in the number and proportion of older persons in their population. Population ageing—the increasing share of older persons in the population—is poised to become one of the most significant social transformations of the twenty-first century, with implications for nearly all sectors of society, including labor and financial markets, the demand for goods and services, such as housing, transportation and social protection, as well as family structures and intergenerational ties. Preparing for the economic and social shifts associated with an ageing population is thus essential to ensure progress in development.

An ageing society is defined as having a minimum 7.0% of its population aged 65 and older, while an aged nation has 14.0% or more in that age group.

According to the World Population Prospects database (UN, 2015), the global population is expected to reach 8.5bn in 2030, 9.7bn in 2050 and 11.2bn in 2100. Continued population growth until 2050 is almost inevitable, even if the decline of fertility accelerates. There is an 80% probability that the population of world will be between 8.4bn and 8.6bn in 2030, between 9.4bn and 10.0bn in 2050 and between 10.0bn and 12.5bn in 2100.

Globally, population aged 60 or over is the fastest growing As fertility declines and life expectancy rises, the proportion of the population above a certain age rises. This phenomenon, known as population ageing, is occurring throughout the world.

In 2015, there are 901m people aged 60 or over, comprising 12.0% of the global population. The population aged 60 or above is growing at a rate of 3.26% per year. Currently, Europe has the greatest percentage of its population aged 60 or over (24.0%), but rapid ageing will occur in other parts of the world as well, so that, by 2050, all major areas of the world except Africa will have nearly a quarter or more of their populations aged 60 or over. The number of older persons in the world is projected to be 1.4bn by 2030 and 2.1bn by 2050, and could rise to 3.2bn in 2100. In the short-to medium term, higher numbers of older population are inevitable, given that the relevant cohorts are already alive.

Source: BIMB Securities Research - 25 Sept 2017