How Singapore, Malaysia and Thailand responded to demographic trends after industrialization in the 1970s
In the 1970s, Southeast Asian nations that had achieved independence from colonial powers adjusted their policies and political attitudes to match the demands of industrialization programs they had embarked on. This was also the case for Thailand, which, although an exception in that it had never been under colonial rule, experienced the seventies as a time of democratic struggle against military rule, and as a time of economic and societal transition from a parochial outlook to a more globalised one (Osborne, 2013).
Industrialization in post-colonial Southeast Asia triggered major demographic changes in the region. Low total fertility rate (TFR), an increase in women’s participation in the workforce, and a rapidly aging population, were some of the demographic shifts that began at the time, and these have persisted till today.
The governments of Singapore, Malaysia and Thailand have responded to these population trends in different ways, and the critical evaluation of their responses forms the crux of this article.
Poor total fertility rate
Singapore and Thailand are currently experiencing low TFR for similar reasons. In both countries, people are marrying later, the use of contraception is high, and there is a preference for smaller families due to concerns that supporting a large family in a fast-paced society would be arduous.
Singapore has addressed low TFR by implementing pro-natal policies, while Thailand has adopted a no-intervention approach (Gubhaju & Moriki-Durand, 2003). Pro-natal policies were introduced in Singapore in the 1980s to arrest the low-TFR that had resulted from the overly effective anti-natal policy of the 1970s, which called on couples to limit the number of children they wanted to have to two. The two-child policy was replaced with a subsequent encouragement to have “three, or more if you can afford it”, a statement that was supported by a package of numismatic incentives to encourage couples to have more babies (Yap, n.d.). Low-TFR has not been reversed even with such policies and this prompted the government to introduce in 2013 a more comprehensive marriage and parenthood package worth SGD$2 billion (up from SGD$500 million in 2001). This package included subsidies for childcare, housing grants and even funds for matchmaking events to get individuals of marriageable age together (Adam, 2013).
Thailand, which is facing low-TFR as a result of the effectiveness of its anti-natal policy implemented in 1992, opted for a no-intervention policy in 1997, and by eliminating the stipulation of targets for birth rates, it removed statutory pressure from couples’ decisions on the number of babies they wanted to have.
It is interesting to note that even with Singapore’s pro-natalist policies its TFR recorded in 2000 was 1.59, while Thailand, with a no-intervention policy, reported a TFR of 1.8 in 2001 (up from 1.2 in 1996).
There are important reasons why pro-natalist polices in Singapore failed while the no-intervention approach in Thailand correlated with a low, albeit, slightly higher TFR than Singapore’s, chief of which is the fact that Singaporeans work the longest hours in the world (46.6 hours each week) (Hodal, 2012), making it quite unconducive for them to think of having babies.
In addition, institutional measures to promote procreation may not be effective unless there is a radical shift in the mindsets of employers and workers about the disadvantages of continuously letting work override the importance of time spent with the family. This is why the Singapore government is investing SGD$40 million over the next three years to promote a pro-family environment in the community through Family Life Education talks, workshops and various events (Lee, 2013).
Women in the workforce
Women’s labor force participation is another consequence of the drive toward modernization in Southeast Asia. In Singapore and Malaysia, for example, the presence of a well-trained, educated workforce was crucial to attracting foreign direct investment for business development. This in turn led to opportunities for women to get an education and join the workforce.
However, Singapore was better at promoting gender equity in the workplace, which meant that Singaporean women could meaningfully invest their time and energy in building their careers. Implementing laws that promoted gender equity, for example, the Women’s Charter, enabled the Singapore government to fully tap women’s labor potential.
Malaysia has not done as well in this respect. Hutchingson (2000) notes that MNCs based in Malaysia are obligated to abide by prevailing norms in Malaysian society that favor men over women. Hence, promotions and training opportunities often tend to go to men.
A strong gender equity policy might be one reason why, although much smaller than Malaysia in terms of size, Singapore has a per capita GDP that is much higher than its counterpart’s.
Rapidly ageing population
Another effect of industrialization is a rapidly ageing population, or the increase in the size of the proportion of elderly individuals in a country, which is the direct consequence of a low TFR. A large ageing population is associated with low labor productivity, a higher elderly dependency ratio, and a rise in the number of people suffering from chronic illnesses.
The number of elderly people will exceed the number of young people by 2020 in Singapore, and by 2040 in Thailand. (Gubhaju & Moriki-Durand, 2003). And by the year 2050, the elderly dependency ratio will increase by 50 percent in Singapore and by 34 percent in Thailand.
Ensuring that the elderly have enough retirement savings, as well as accessible, affordable healthcare are key to addressing the problem of an ageing population (Gubhaju & Moriki-Durand, 2003).
Singapore and Thailand have taken different routes in ensuring the economic security and wellbeing of their ageing population.
In Singapore, the elderly rely on the Central Provident Fund (CPF), a social security savings plan established for each Singaporean, from which they can make yearly withdrawals after the age of 55 to support themselves financially (Gubhaju & Moriki-Durand, 2003).
In contrast, Thailand has limited pension coverage for its elderly – only government employees (7 percent of whole workforce) are entitled to pensions (Gubhaju & Moriki-Durand, 2003). What this means for Thailand is that the vast majority of its elderly will be entirely dependent on younger people, a burden that would be amplified if we consider the 34 percent increase in the elderly dependency ratio by 2050.
The Singapore government’s setting up of the CPF in 1955, even before it embarked on massive industrialization to lift the city-state from third-world to first-world status, ensured that every citizen would have a state-controlled, compulsory savings account. The CPF not only provides Singaporeans a sense of security in the form of savings, it will also mitigate the pressure from Singapore’s elderly dependency ratio in 2050.
Thailand has done better than Singapore in terms of healthcare coverage for the elderly. Needy aged folk in Thailand have a free healthcare card and can opt for medical insurance that covers a range of medical conditions for only 30 baht per visit (less than USD$1) – with additional treatment costs being borne by the government.
In Singapore, on the other hand, while elderly patients are entitled to subsidies, these are not as extensive in their reach as those in Thailand. For example, many commonly prescribed branded drugs for diabetes and high blood pressure, which have excellent safety and efficacy profiles are not on the Singapore Ministry of Health’s Standard Drug List 2 (patients using drugs on this list can get a 75 percent discount on the drug’s retail price) (Ministry of Health [MOH], 2013). This means, patients recommended those drugs have to pay the full price themselves (MOH, 2013). Hence, elderly with long-term conditions like high blood pressure and diabetes will run out of funds quickly.
Singapore, Malaysia and Thailand have adopted different strategies to deal with demographic changes. In doing so, each country has had to come up with solutions that matched its own cultural and geopolitical needs.
Richard Philip - 29 August 2013
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