Significant aging is projected for many high-saving emerging economies of East and Southeast Asia. By 2025, the share of the elderly in their populations will at least double in most of these countries. The share of the young will fall. Aging populations could adversely affect saving rates in these economies, particularly after 2025. For the world, one may observe that, initially, the Asian Tigers could become increasingly important for world savings, reflecting their increased weight in the world economy, their high saving and growth rates, and the aging of the industrial countries. After 2025, the aging of the Tigers may reinforce the tendency toward a declining world saving rate.

Significant aging is projected for many high-saving emerging economies of East and Southeast Asia. By 2025, the share of the elderly in their populations will at least double in most of these countries. The share of the young will fall. Aging populations could adversely affect saving rates in these economies, particularly after 2025. For the world, one may observe that, initially, the Asian Tigers could become increasingly important for world savings, reflecting their increased weight in the world economy, their high saving and growth rates, and the aging of the industrial countries. After 2025, the aging of the Tigers may reinforce the tendency toward a declining world saving rate.

The paper assesses the government expenditure effects from changing demographics in the Asian “Tiger” economies through 2050. With some exceptions, their limited social insurance commitments initially suggest that aging populations may not adversely affect fiscal balances. Yet for all the Tigers, changing illness patterns and medical modernization may combine with demographics to intensify budgetary pressures. The paper notes the implications of the Tigers’ reliance on private sector pension and medical insurance systems; the need for an active public role; and the complications for fiscal analysis when private sector instruments are used, in a mandatory way, as public policy instruments.

The global economy faces a transition of unprecedented dimensions caused by rising old-age dependency and shrinking working-age populations among the world's largest economic powers. In an important respect, global aging represents a success story: the advent of mass survival into old age. But population aging is driven primarily by a decline in birthrates. Below-replacement birth rates over the past four decades have left Japan and Europe with the prospect of shrinking numbers of workers and consumers for much of the next half-century, while North America faces an abrupt slowing of labor force and population growth. These declines will occur even as the retirement of the postwar baby boom generation produces a large increase in pension-eligible populations across the developed world. For the nations directly affected, the likely consequences will include rising deficit pressures and slower economic growth. These problems will initially be felt in economies that today account for two-thirds of global output, which suggests that, in the absence of effective policy responses, global aging poses a significant threat to global prosperity. It was to examine and make recommendations on this cross-national challenge that the 85-member Commission on Global Aging -- consisting of leading voices from politics, business, civil society, and a range of academic disciplines from the United States, Japan, and Western Europe -- came together in 1999-2001 under the auspices of the CSIS Global Aging Initiative to develop policy recommendations for the countries most directly affected. This is the Commission's final report.