10 Countries On The Verge Of A Crippling Demographic Crisis

Gus Lubin | Feb. 22, 2010, 8:56 AM | 155,661 | 23

Tags: Features, International, Emerging Markets, China, Japan, Russia
When people are having too few babies or too many, there's only so much that gov
ernment can do.
Demographics crises may be the ultimate determinant of the fate of nations and t
he easiest to predict. In most cases, the population shift has already occured t
hat dooms a country to slow or sudden decline.
We picked ten countries that stand out for extreme shifts in population and age,
as well as countries facing unique situations due to political structure. For i
nstance: even moderate shifts occuring in countries with large populations and e
conomies, like the US, can be cataclysmic.
These ten countries are all developed or emergent markets, which is to say they
do not include minor and undeveloped countries that are already locked into demo
graphic chaos (see Niger, home to the world's highest birth rate).
See The Ten Countries On The Verge Of A Demographic Crisis
Part One: Emerging Economies With Out Of Control Population Growth
Pakistan: $167 Billion GDP

Population change by 2040:+38%

Median age in 2010: 21.3
Median age in 2040: 29.4
Birth rate: 65 out of 223
Pakistan is rapidly becoming the fourth most populous country in the world, but
that does not make it one of the BRICs. Far more than neighbors India and China,
Pakistan lacks the infrastructure for educating its surging population and the
economy for employing them.
"Time is running out to put appropriate policies in place. The absence of this m
ay result in large-scale unemployment and immense pressure on health and educati
on systems. In short, a socio-economic crisis may take place, making the demogra
phic dividend more of a demographic threat,â said Durr-e-Nayab of the Pakistan Ins
titute of Development Economics.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN

Egypt: $188 Billion GDP

Population change by 2040:+32%
Median age in 2010: 23.9
Median age in 2040: 32.8
Birth rate: 69 out of 223
Egypt has more than twice the GDP per capita of Pakistan, but just about the sam
e birth rate, median age, and blazing population growth. The rising population t
hreatens to overwhelm the emerging economy, causing a rise in unemployment, poll
ution, disease, and unrest. Already there are not enough jobs for the half-milli
on Egyptians that join the job market each year, according to the AFP.
Extreme population density is another problem.
"Egypt, outside the desert, has the highest population density in the world, wit
h 2,000 inhabitants in every square kilometre, twice that of Bangladesh," said p
opulation specialist Philippe Fargues of the American University in Cairo.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN
Saudi Arabia: $380 Billion GDP
Population change by 2040:+54%
Median age in 2010: 24.6
Median age in 2040: 33.8
Birth rate: 51 out of 223
The quintessential job for a Saudi man used to be an executive position in state
-sponsored company, with a big pay check and very little work. But there are onl
y so many jobs the Sultan can give away. With the population growing at a third-
world rate, the government is struggling to diversify the economy away from petr
oleum, according to the CIA World Factbook.
"In a country with a young demographic profileâ those below 30 make up over 60 perc
ent of the populationâ the need for change has not been as strong for quite some ti
me, and yet the current situation forebodes a rare combination of both challenge
s from a long time past and a unique opportunity to confront them," said Hassan
Hakimian, an economist at the Cass Business School.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN

Part Two: Advanced Economies That Will Shrivel And Die

Ukraine: $116 Billion GDP
Population change by 2040: -21%
Median age in 2010: 39.5
Median age in 2040: 46.6
Birth rate: 202 out of 223
Low birth rate and high emigration rates are the story throughout eastern Europe
. Ukraine stood out for its rate of population decline, which is the highest of
all developing countries, according to the CIA World Factbook. Former President
Viktor Yushchenko saw an even more dire picture when he warned Ukraine could los
e half of its population by 2050, according to Ukraine news site ForUm.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN
South Korea: $800 Billion GDP
Population change by 2040: -2.5%
Median age in 2010: 37.9
Median age in 2040: 51.0
Birth rate: 212 out of 223
South Korea is swiftly catching up to Japan in terms of old populations with dis
mal birth rates. As such it may be heading toward its own lost decades: stagnati
on, labor deficits, and burdensome pensions and health care. Meanwhile, North Ko
rea is turning out babies at a quick rate, which has scary implications for the
island balance of power.
"The challenge facing Korea is especially daunting, and quite simply no other so
ciety at a similar stage of development faces an age wave that is as massive as
Korea's, or as fast-approaching," said Keisuke Nakashima, a researcher at the Ce
nter for Strategic and International Studies.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN

Russia: $1,255 Billion GDP

Population change by 2040: -13%
Median age in 2010: 38.1
Median age in 2040: 45.5
Birth rate: 178 out of 223
Although Russia fared well in the past decade -- named alongside Brazil, India,
and China as Goldman Sach's favorite developing economies -- it is now doomed to
a long and inevitable decline. Low birth rates are already depleting the popula
tion. The labor force can only be preserved with a massive influx of immigrants,
but immigrants are hardly breaking down the door.
Aging populations will produce a heavy pension burdens, as in other developing c
ountries. Russia may be thankful, however, for a high death rate that keeps pens
ions in check. The world's twelfth highest death rate has much to do with alcoho
lism and cigarettes, said the NYT.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN
Germany: $3,235 Billion GDP
Population change by 2040: -10%
Median age in 2010: 44.3
Median age in 2040: 51.2
Birth rate: 220 out of 223
Deaths have outnumbered births in Germany since 1972,according to Steffen Krohne
rt at Berlin's Institute for Population and Development. With this demographic d
ebt, Germans are doomed to watch their industrial power fade, and fade faster ea
ch year. Germany lost its place as the world's top exporter last year to China.
In the past decade, Germans have attempted to stave off decay by extending mater
nity leave to encourage reproduction. They have even considered revising immigra
tion laws in order to recruit a supply of foreign laborers, according to the AP.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN
China: $4,758 Billion GDP
Population change by 2040:+7.5%
Median age in 2010: 34.2
Median age in 2040: 44.1
Birth rate: 151 out of 223
What does it mean for a billion-plus population to become ten years older? An in
credible surge in senior citizens that will break the back of China's state pens
ion system, according to Harvard demographer Nicholas Eberstadt. A big part of C
hina's elderly care -- their children -- are already suffering from policies tha
t limited families to one child.
On the other end of the age spectrum, China's labor force is growing faster than
available jobs. Unemployment won't be a serious problem if China keeps booming,
but it will be a huge problem if theChina bubble pops.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN
Japan: $5,049 Billion GDP
Population change by 2040: -15%
Median age in 2010: 44.7
Median age in 2040: 54.7
Birth rate: 222 out of 223
Hatoyama and other optimists talk about bringing Japan out of its two decade slu
mp. Unfortunately, ongoing demographic shifts could mean the situation is going
to get much worse. Japan has just about the oldest population with the world's l
owest birth rate, and the median age is going to rise another 10 years by 2040.
In fact, floundering Japan may be the next in line for a rating downgrades from
Standard & Poor's.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN
Part Three: Don't Forget The USA
USA: $14,270 Billion GDP
Population change by 2040:+22%
Median age in 2010: 36.6
Median age in 2040: 40.8
Birth rate: 154 out of 223
Although the demographic shift is not as severe as some, the effects will be mag
nified in America's unparalleled economy. Caring for the elderly will cost more
than it does in South Korea because our population is over six times larger. At
the same time, it will cost more than in China because we have a higher degree o
f social welfare legislation, like Social Security and Medicare.
As the timing works out, the latest recession may be the moment demographics cat
ch up to America. The retirement of baby boomers will redefine our basic economi
c structure. Industries like manufacturing are predicted to decline through the
decade, while jobs in medicine and senior care are going to boom.
Source GDP & Birth rate: CIA World Factbook
Source Population & Age: UN