Bernardo M. Villegas
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How to Attract Japanese Retirees

          Ever since the Philippine Retirement Authority was put up during the Marcos Administration, I have heard talks of tapping the large population of Japanese senior citizens for our retirement villages.  In fact, the very first retirement facility, Rose Princess, was put up in Cabuyao for Japanese retirees.  Unfortunately, for decades, our retirement program degenerated into a visa-selling affair.  It was only when former PNP and Armed Forces Chief Ed Aglipay became President of the Philippine Retirement Authority  during the Arroyo Administration was there a more serious effort to develop a long-term plan to attract retirees from different parts of the world.  Top officials of the foreign chambers of commerce, especially the European Chamber of Commerce and Industry, contributed time and resources to preparing a road map for the Philippine retirement industry.

          Attracting large numbers of Japanese retirees to the Philippines, however, has remained a pipe dream.  There are some serious obstacles.  The first one has to do with the image that many Japanese senior citizens have of the Philippines as an unsafe country.  A much publicized kidnapping of a Japanese executive did not help to counter this image.  Then there is the lack of portability of medical insurance, i.e. Japanese insurance and social security institutions refuse to pay for health services obtained by their citizens in the Philippines.  Then there is the intractable language hurdle:  Japanese patients need Japanese-speaking doctors and other health personnel if they are to come to the Philippines to spend part of their retirement years.  It is clear, therefore, that it is not enough to cite data that more than 20 percent of the Japanese population today are over 65 years of age.  There must be some ways of removing the above-mentioned obstacles.

          Recently, I heard the new President of the Philippine Retirement Authority in a Focus Group Discussion conducted by the Center for Research and Communication.  Veredigno Atienza is the right person at the right time.  His education and training include degrees in economics and management and he has vast experiences in both finance and marketing, the two functional areas in business that can contribute to the solutions to the above-mentioned problems.  It was refreshing to hear him admit that attracting Japanese retirees to the Philippines will not be a walk in the park.  He is fully aware of the obstacles.  That is why he is mobilizing the strengths of all the concerned sectors:  the Government, especially the Department of Tourism to which his agency is attached; the business sector whom he gathered in a recent summit; the academe to provide him with the necessary data, especially for the market segmentation of the Japanese who can be attracted to come to the Philippines, i.e., the short-term tourists, the long-staying visitors, the active retirees and the medically challenged senior citizens who need health care.

          I am confident that with the help of the various sectors from whom he is seeking advice, we can gradually remove the obstacles to attracting big numbers of Japanese retirees to the Philippines.  The international press is constantly reminding us that the opportunity is there and will actually expand through the years.  Just recently, a former Japanese vice minister of the Ministry of International Trade and Industry and president of Dentsu Research Institute wrote an article entitled "How does Japan start to cope with fewer births, longer lives?"   I would like to summarize the main points raised by this high official of Japan to encourage our greater effort in attracting Japanese retirees to live in the Philippines so that they can get greater mileage from their meagre pension of some $2,000 to $3,000 a month. 

            According to Mr. Fukukawa, the aging and numerical decline of the Japanese population is rapid, and if the present trend persists much longer, its economic scale is bound to shrink and its international status will decline.  In fact, last year, China overtook Japan as the second largest economy in the world after the U.S.   Japan's population reached a peak of 127.77 million in 2004.  The National Institute of Population and Social Security Research predicts that Japan's population will be down to about 90 million in 2055.  The most alarming feature of Japan's demographic profile is not the reduction in total population.  It is the rapid aging of the Japanese.  The average age of Japanese people was 45 in 2010.  It is predicted to reach 55 in 2055.  The ratio of the country's working-age population to its aged population was 10:1 in 1960 when Japan started its steep rise to be an industrial power in the world.  Today the ratio is 3:1 and is forecast to reach 1:1 in 2055.  There is no question that Japan has to look for radical solutions to the problem of caring for the aged.  They will have practically no young people to take care of their senior citizens.

          Mr. Fukukawa further states that the decline in the birthrate and the increase in the number of aged people are considered likely to result in a rise in social insurance expenses, causing the nation's financial structure to weaken.  Currently, Japan's ratio of outstanding public debt to GDP is estimated at 184.6 percent, the worst level among advanced countries.  The situation is not expected to improve considering the deflationary economic conditions that are prevailing.  The necessary tax increases to address the deficit will prolong deflation and force people to lower their standard of living.  Nursing care for aged people will be an important social problem in the years to come.  But even if service robots are utilized in medical and nursing care facilities as well as individual homes, there will be a serious shortage of nursing care human resources.

            Considering all these developments, the Philippines--still enjoying a huge demographic dividend for the next thirty years--will be in the best position to assume the task of caring for the aging Japanese.  Indonesia is our only real competitor.  Singapore and Malaysia have small populations.  Thailand is also aging rapidly.  We have to capitalize on our highly educated manpower, with the extra quality of knowing how to give tender and loving care to aging and/or sick people, in helping Japan cope with its acute aging problem.  Given the resolve of the Philippine Retirement Authority to overcome the obstacles described above, the retirement industry in the Philippines is facing very bright prospects.  For comments, my email address is