Taiwan’s declining birthrate has been a cause for concern among policymakers for decades, with the emergence of an increasingly aging society posing serious challenges for the nation’s economy, education, healthcare systems, government budgets, and national competitiveness.
The latest population projections published by the Cabinet’s Council for Economic Planning and Development (CEPD) have raised alarm bells, indicating that Taiwan’s transition to a graying society is happening at a faster pace than previously anticipated. Two years ago, the CEPD projected that Taiwan would reach zero population growth by 2022, but the new report has revised this figure to four years earlier, highlighting the difficulty in accurately forecasting birthrates.
Taiwan has now joined Japan as one of the fastest aging societies in the world, with around 15 percent of the population over 65 years of age. This figure has more than doubled since 1980 when it stood at 7 percent, and the CEPD projects it will reach 20.6 percent in the next two decades.
The economic impacts of an aging society are already being felt in Taiwan, with low birthrates leading to a decrease in demand, reduced production outputs, and lower prices. Long-term effects include a decline in labor supply, resulting in decreased productivity and increased labor costs. Japan’s economic struggles over the past 15 years serve as a cautionary tale for Taiwan, highlighting the potential severe impact on economic development.
In response to these challenges, the Cabinet has outlined a series of policy directives aimed at addressing the needs of Taiwan’s aging population. These include stipends for elderly farmers, subsidies for seniors‘ welfare, a new retirement system, second-generation health insurance policies, improvements to medical services, protection for the underprivileged, and the implementation of a national pension scheme.
The upcoming National Conference on Sustainable Economic Development is expected to delve into the issues of birthrate decline and aging population, with the hope of generating innovative solutions to these pressing challenges. It is crucial for Taiwan to adopt practical and achievable measures to support its aging population and ensure sustainable economic development in the years to come.