Southeast Asia

The Economic Outlook for Southeast Asia, China and India is a bi-annual publication on regional economic growth, development and regional integration in Emerging Asia. It focuses on the economic conditions of Association of Southeast Asian Nations (ASEAN) member countries: Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Viet Nam. It also addresses relevant economic issues in China and India to fully reflect economic developments in the region.
The Outlook comprises four main parts, each highlighting a particular dimension of recent economic developments in the region. The first part presents the regional economic monitor, depicting the economic outlook and macroeconomic challenges in the region. The second part consists of a special thematic chapter addressing a major issue facing the region. The 2019 edition of the Outlook looks at smart cities, with a special focus on transportation. Addressing traffic congestion, in particular, is critical in realising the potential benefits of urbanisation for growth. The third part of the report includes structural country notes offering specific recommendations for each country, and the fourth part discusses the recent progress made in key aspects of regional integration.

Asia Pacific (APAC)* is the fastest ageing region in the world with more than 200 million people expected to move into the ranks of the elderly (aged 65 years and above) between now and 2030. This represents an increase of 71 percent in the number of elderly people, compared to increases of 55 percent in North America and 31 percent in Europe over the same period.
Driven by improving socio-economic conditions and increasing life-expectancy, the speed at which societies in APAC are ageing poses an unprecedented challenge. For comparison, Singapore’s elderly population will rise from 11 to 20 percent in the next 15 years, while it took France 49 years to do the same. By 2030, Japan will become the world’s first “ultra-aged” nation, with the elderly accounting for more than 28 percent of the population, while Hong Kong, South Korea, and Taiwan will be considered “super-aged”, with more than 21 percent.
Many APAC countries are moving from a period when they reaped a “demographic dividend” to one where they face the prospect of paying a “demographic tax”. Such a significant demographic shift will be accompanied by a host of financial and socio-economic risks affecting multiple stakeholders, as shown in Exhibit A. Consequently, there is an urgent need to evaluate each country’s readiness to manage increasingly aged societies and to develop solutions that mitigate the associated risks. This report takes a deeper look into the impact of societal ageing on elderly healthcare costs in APAC.

Security challenges in East Asia are becoming acute. North Korea is developing a missile-deliverable nuclear weapon, and the long-term stability of the Pyongyang regime is questionable. Taiwan, which Beijing claims as part of Chinese territory, is about to have a presidential election in which a candidate from a pro-independence party is the front-runner. China has also become increasingly assertive in its territorial disputes with Japan and several Southeast Asian countries. Meanwhile, Japan's leaders are attempting to redefine the role Japan plays in regional security affairs. Indeed, Japan's legislature recently enacted revisions to the country's national security laws that would loosen limitations on the use of Japan's armed forces, and the government of Prime Minister Shinzo Abe has pledged to increase defense spending