MANILA, July 3 (Xinhua) -- The Philippines is slowly aging, according to a study by state think-tank Philippine Institute for Development Studies (PIDS) released on Wednesday.
In a little over a decade, the paper titled "Are We Missing Out on the Demographic Dividend? Trends and Prospects" said the Philippines' elderly, aged 65 or older, will comprise at least seven percent of the total population by 2032.
The PIDS research fellow Michael Abrigo said the Philippines will further transition to an "aged society" when the share of the elderly population reaches at least 14 percent by 2069.
Abrigo warned the rising number of old people may pose a heavy burden on the country's resources. However, he added that the same economic and demographic forces that will eventually lead to population aging also provide potentials for economic growth.
"Population aging is not a bad thing. It represents a story of our collective success as Filipinos. It means that we were able to conquer the challenges such as those related to income, health, and education," Abrigo explained.
Still, he said it comes with both challenges and prospects, noting that the government is particularly affected as income tax, health insurance premiums, and pension contributions to the total population may decline as a result of the demographic shift.
"This, in turn, may affect the sustainability of services that the government provides," he said.
"More elderly people means more subsidies for healthcare expenses. Moreover, the elderly tend to have medical conditions that are more expensive on the average," Abrigo said.
On the other hand, Abrigo said aging, along with rising life expectancy, also leads to higher savings and investment and may result in faster economic growth and improved living standards. "Because we expect longer lifespan, we also tend to save more, and this leads to greater productivity."
Abrigo said these improvements in the material measures of well-being may arise, which is called demographic dividends.
Abrigo said that demographic dividends are just growth potentials and are not automatic as people still need to work to attain them. Unlocking these potentials requires both responsive and effective policies.
Given the demographic dividends resulting from the demographic shift brought by a decline in fertility rates, the study highlights the importance of supporting families to achieve their desired fertility levels.
However, it noted that an uneven decline in fertility rates across different populations could exacerbate inequality.
