Benefiting from Double Sweet Spots (Part 2)
Another hapless country that is ageing before becoming rich is Thailand that used to be the darling of foreign investors in the last century. According to a recent report of the Japan Research Institute (JRI) Economics Department entitled “Thailand’s Efforts to Cope with a Rapidly Ageing Population,” demographic ageing has been especially rapid in Thailand compared with other major emerging Asian economies, especially the famous VIP (Vietnam, Indonesia and the Philippines) countries. The percentage of the Thai population aged 65 or over is expected to climb from around 10% at present to over 20% by the 2030s. Until the 1970s, Thailand’s total fertility rate (TFR) was consistently above 5.0 and its total population showed sustained annual growth of 3%. The birthrate, however, began to fall sharply in the 1970s in response to the governments’ efforts to reduce the number of children born by promoting family planning. By the early 1990s, Thailand’s birthrate had fallen below 2.1, the population replacement level or zero population growth. One of the reasons for this precipitous decline in the fertile rate was the aggressive family planning promotion campaign by the Population and Community Development Association (PDA), which was founded by former Minister of Public Health Mechai Viravaidya in 1974. Through the indiscriminate distribution of condoms in the Thai villages, Thailand’s birthrate declined to just below 1.5 babies per fertile woman, while the working population peaked in the first half of the 2010s and is now in decline. Today, Thailand’s birthrate is low even compared with countries that have similar income levels. Because of the shortage of workers in both the industrial and agriculture sectors, the growth of manufacturing and agriculture has been slowing down significantly.