Bernardo M. Villegas
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How to Prolong Demographic Dividend

           In the emerging ASEAN Economic Community (AEC) that will replicate the outstanding accomplishment of the European Economic Community (EEC) in the last century, the three countries that are attracting a great deal of attention from investors, bankers and multinational corporations from all over the world are Vietnam, Indonesia and the Philippines (the VIP countries).  In a short while, there will also be greater in interest in Myanmar that is now undergoing a transition towards greater economic and political freedom for its 50 million inhabitants.  Other ASEAN countries like Singapore, Malaysia, Brunei and Thailand are no longer as attractive because, unlike the VIP countries, they no longer can boast of a growing and young population.  In other words, they do not have the attraction of a large domestic market and an almost unlimited pool of productive manpower.  They have seen the end of their "demographic dividend," the stage in the demographic cycle of every country in which the labor force is still growing faster than the aging or retired population.

          This demographic dividend is of special interest to people in business because of the most serious challenge to practically all developed countries, including those of Northeast Asia.  This challenge is called the demographic winter or demographic suicide.  This phenomenon is aptly captured by a recent article by Michael Cook in MercatorNet.com  entitled "Going extinct is no fun."  The article quotes Lee Kuan Yew, the founding minister of Singapore and one of the great statesmen of the 20th century.  At the most recent National Day celebration in Singapore, he bared his soul:  "If we go on like that (with birth rate of 0.78), this place will fold up, because there'll be no original citizens left to form the majority, and we cannot have new citizens, new PRs (Permanent Residents) to settle our social ethos, our social spirit, our social norms. ...Our educated men and women must decide whether to replace themselves in the next generation.  At the moment, 31 per cent of women and 44 per cent of men are opting out.   Not leaving a next generation...But we've got to persuade people to understand that getting married is important, having children is important.  Do we want to replace ourselves or do we want to shrink and get older and be replaced by migrants and work permit holders?"

          Singapore is a very small territory with a small population.  The optimists will say that it will take a long time before a populous country like the Philippines will face a similar predicament.  Don't bet your life on that.  South Korea, with a much larger population of 50 million today, took only one generation to lose its demographic dividend.  Even China, with a population of 1.3 billion is also suffering serious imbalances in its demographic profile because of its aggressive one-child policy.   Believe it or not, the rich and educated people of the Philippines already are adopting the contraceptive lifestyle of the Singaporeans.  The fertility rate among them is already below the replacement rate of 2.1 babies per fertile women and much below the average fertility rate in the Philippines which is 3.1 babies.  Thanks to the lower-income groups, we still have a young and growing population, which is the greatest attraction to both local and foreign investors.  Thanks to our demographic dividend, we are still considered among the emerging markets that will dominate the global economy in economic growth for the next twenty years.  The challenge is how to prolong this demographic dividend as long as possible.

          The answer is to reject even the so-called amended version of the RH Bill.  One of the amendments being brandished by the pro-RH Bill advocates is the provision that will focus on the poor households in the distribution of free contraceptives.  That will be a terrible mistake.  The poor should not be brainwashed about having few children.  They are the ones who have not yet developed an unhealthy prejudice against large family sizes.  There is scientific evidence that the vast majority of them are satisfied with the number of children they have.  Journalists exaggerate when they keep on harping on the agonies of mothers with too many children.  To make sure that we prolong the demographic dividend, society should support the upbringing and education of the children of the poor by such direct interventions as the provision of countryside infrastructures, quality basic education for all, health services, microcredit and microenterprise support, and the conditional cash transfer(CCT) that has already been started by the Government.  For the few households who really prefer fewer children, the CCT program should be so designed so that the amount given to each household should include a budget that can cover the purchase of contraceptives, if they should so desire.  This cash provision will address the problem of avoiding any coercion or brainwashing and will also consider the conscientious objection of those who do not want their taxes to go directly to state purchases of artificial contraceptives.

          The Department of Social Welfare and Development has been appealing to people working for the welfare of the poor to understand the real needs of the poor.  This was the theme in a conference at the University of the Philippines last October 29, 2012.  Many times, well intentioned and charitable social workers impose their own criteria on the poor.  I maintain, from evidence of studies I have read from here and abroad, that the vast majority of the poor want large families for economic, social and cultural, and spiritual reasons.  Let us stop convincing them that they should have only two children.  They need to have a large family in the farms, where most of them live, in order to help in eking out a living.  They need children as an insurance against old age.  They need children to give meaning and happiness to their lives.   Among the very poor who really want to limit the number of children, let them freely decide to use part of the conditional cash transfer to purchase artificial contraceptives. 

          I maintain, therefore, that the RH Bill in its amended version remains objectionable because it is guilty of a sweeping generalization that the common good of Philippine society can be served by the free distribution of contraceptives to the poor.  On the contrary, by helping the poor to retain their pro-children outlook, we will prolong the demographic dividend that is a competitive advantage of the Philippines in today's global economic environment of shrinking markets and dwindling labor forces all around the world.  Once again, there is no need to pass an RH Bill in whatever amended form it may take.   Let us use legislative time for more productive and constructive  issues.  For comments, my email address is bernardo.villegas@uap.asia.