The world stands on the brink of a crisis with old people likely to outnumber the young sooner than anyone thinks, fewer babies born and pension costs soaring as economies slow, a population expert said yesterday.
"There is still time to avert crisis," said Richard Jackson, an adjunct fellow at the Center for Strategic and International Studies, or CSIS, a public-policy think tank in Washington.
"But time is running short -- and the problem is worse than is generally supposed," he wrote in a report for Citigroup Asset Management.
Jackson cited global aging, falling fertility, untenable pension costs with fewer taxpayers to support them and financial market chaos as developed countries grow old, followed soon by the developing world -- and all topped off by giant China.
The problem of populations top-heavy with the elderly is one that has appeared with almost lightning rapidity. Its threat to the developed and the developing world was neatly summed up by a Chinese writer, Jackson said.
"Whereas the now-developed countries first got rich and then got old, China will get old first," he quoted Lin Ying as writing.
Human life expectancy has made greater gains in the past 50 years than in the last 5,000, and governments must confront what may seem a boon but may prove a bane, said Jackson.
He painted a picture of a world within just 20 years in which European economies had not grown for a decade and Japan, the world's largest debtor, has to ask the IMF for a bailout -- and is turned down by, yes, China.
"Global aging threatens to bankrupt the developed countries, destabilize the global economy, and even overturn the geopolitical order," he told a seminar in Singapore.
"Within the next five to 10 years, the demographics will shift -- and the window of opportunity will close," he wrote. "Leaders need to act before it's too late."
He foresaw two futures for East Asia.
One in which developed countries fail to confront their aging challenge, resulting in a crisis that could engulf the world. Growth would slow in Asia, capital shortages increase, export markets shrink and protectionism would rise.
But with timely reforms, East Asia and its developed nation partners could reap huge benefits from economic integration.
Countries should increase employment among working-age adults, encourage later retirement and reward families that raise children, Jackson said. And more economies will have a spillover effect by allowing more young people to support the old across borders.
In developed countries, the percentage of the population aged over 65 was 15 percent at the turn of the century and due to rise to 27 percent by 2050 -- and to 35 percent in Japan, which is already way ahead in terms of its graying population.
In the developing world, the percentage aged over 65 stood at 6 percent in 2000 and is set to hit 14 percent by 2050.
But it's not just aging. One of the hottest topics debated at Monday's seminar was fertility. Why don't women want babies?
The numbers show fertility in the developed world has fallen furthest, from 2.4 percent in 1965 to 1970 to just 1.6 percent in 1995 to 2000 and well below the 2.1 percent replacement rate.
Life expectancy has risen to 79 in the developed world and 63 in developing countries, from 67 and 41 respectively in 1950 to 1955.