Vietnam’s aging 100-million population a demographic time bomb

Vietnam’s population of 100 million people means trouble could haunt the country’s demographic future sooner rather than later, with a quickly aging population a major challenge.

The falling children’s mortality rate and the increase of life expectancy is making Vietnam more rapidly reach the aging population figure that spells the end of the « golden population period, » which is defined by the U.N. Population Fund (UNFPA) as having 30% of the population’s children aged below 14, and 15% of all people aged 65 or more.

This means that Vietnam will have less working-age people and more people in retirement age, which can lead to numerous burdens on society.

Vietnam currently stands third in Southeast Asia, after Thailand and Singapore, in the proportion of population aged 65 and over, while its income per capita ranks only sixth in the region.

With its population hitting 100 million last April according to the General Statistics Office, Vietnam is now the 15th most populous country in the world and its population density ranks 41th. When it comes to yearly income per capita, Vietnam is ranked 121st at $4,010. This figure is 10 times lower than that of Japan and 19 times lower than that of the U.S., placing Vietnam in the lower-middle grouping of nations.

Leaps and bounds ?

Vietnam’s population has doubled in the 48 years since its reunification, jumping from 47 million to 100 million. Over the previous century, Vietnam’s yearly population growth has always been higher than the global average. But that trend shifted in the 2000s, following a decade of family planning policies that limited the number of children born in a family to two.

Birth rates are falling across the nation, but the rates themselves differ in different areas. The waves of migrants heading for big cities have also caused an imbalance in population distribution between urban and rural regions. As a result, average incomes and lifespans between localities are markedly different as well.

Those in southeastern Vietnam, home to the country’s manufacturing hubs, enjoy the highest income among all areas in the country. Binh Duong Province leads with a monthly income level at VND8.1 million ($342), four times higher than the bottom of the list: Ha Giang Province in the northern highlands with VND2.1 million a month.

People in HCMC and five southeastern neighbors (including Binh Duong) also have the longest average lifespans. Ba Ria-Vung Tau Province tops the list with an average lifespan of 76.4 years, 8.5 years longer than those in the northern mountainous Lai Chau Province at the bottom of the list.

Lai Chau also has the lowest population density in the country, with only 53 people per km2. In contrast, Ho Chi Minh City has the highest population density at 4,481 people per km2. The average population density throughout the entire country is 300 people per km2.

Vietnam is already half past its « golden population period », starting 2007, when it hit the 90-million population mark. This period is expected to end in 2039, when at least two people of working age must take care of either a child below 15 or an elderly person above 65, according to UNFPA.

Nguyen Thanh Long, an expert at population and development from the National Economics University, said a « golden population period » is a once-in-a-lifetime occasion for any country.

In Vietnam, following a population boom, localities began to persuade couples to bear two children at most starting 1993 as a family planning policy. A decade after that, the country’s birth rate significantly dropped from 3.5 children to 2.1 children born per woman.

The shifting population model, brought about by falling number of children and rising number of people in working age, pushed Vietnam into its « golden population period. » The ready source of young workers became an advantage for the economy to make breakthroughs.

According to a study by professor David Bloom from Harvard University, the shift in population model that gave rise to a large number of people in the workforce has contributed by about 30% to the economic growth of several Southeast Asian countries in the latter half of the 20th century.

Japan and South Korea began their « golden population periods » in 1963 and 1987. Three decades later, both nations prospered and saw a jump in the income per capita, increasing ten-fold to $37,000 and $32,000, respectively.

But not all countries enjoy such an achievement. Thailand’s « golden population period » began 1992. Almost 30 years later, when the country’s population began to age, Thailand’s income per capita only managed to triple to $7,100, putting it in the group of middle-income countries.

« The golden period is only an opportunity, not an automatic pass that benefits any country if they do not have proper strategies to utilize it, » Long said.

In 2017, Vietnam’s Central Party Committee announced there had not been a coordinated solution to utilize the « golden population period » effectively and adapt to an aging population. Population policies then shifted away from sole family planning to focus on all aspects of the population.

In line with global trends, Vietnam’s population growth is slowing down. Experts predict that the population will begin declining in the latter half of the 21st century.

As predicted by the United Nations Population Fund, Vietnam’s population will reach its peak of 107 million people in 2051 and gradually decrease after that. The General Statistics Office, meanwhile, said the population decline will start in 2066 when Vietnam has 117 million people.

The population collapse is said to be a result of declining birth rates, even amid decreasing death rates and increasing life expectancy, thanks to more advanced medical care and better life quality.

With women getting more and more access to education and career opportunities, they will have the tendency to give birth less and less. The trend is not happening only in Vietnam, but globally.

In 2006, for the first time ever, Vietnam had fallen below the replacement fertility rate of 2.1 children per woman, which is needed to sustain a population. Since then, the nation has maintained under that rate, except only for 2020 and 2021.

Given such a low rate, the government has built a Population Strategy through 2030, with the target of keeping the national replacement fertility rate at 2.1, which is the average number of children a woman would need to reproduce.

At the same time, the mortality rate among children has been decreasing, also thanks to improvements in medical care and life quality.

According to the UNFPA, in 1976 Vietnam, 76 of every 1,000 children under five died each year, but the ratio has dropped to just 21 in 1,000, which is much lower than other countries with the same average income.

The life expectancy of Vietnamese people, meanwhile, has been on the rise, staying at 68.6 in 1999, 73.2 in 2014, 74.5 in 2019, and is forecast to rise to 78 in 2030 and 80.4 in 2050.

Vietnam’s population is aging fast and the social insurance network has failed to keep up.

The government expects to have 55% of people over the working age taking their retirement pensions by 2025. But currently only 22% of them are receiving that pension.

With the rate of elderly people on the rise and most with no access to their pension yet, the pressure on the social security system will eventually be « huge » once more people are cashing in on those pensions, according to Professor Giang Thanh Long, an expert on population and development at the National Economics University.

Prof. Long warned that if Vietnam fails to take full advantage of what’s left of its golden population period, economic growth will slow and the nation will face many more difficulties when it officially enters the aging phase in 2036.

The recent birth of Vietnam’s 100 millionth citizen makes it all the more urgent for Vietnam to solve its rapidly aging population problem.

« It is an indisputable fact that the population of Vietnam is aging very quickly, but the nation is not yet a wealthy one. The key when dealing with an aging population is to improve productivity. We have to be rich before we get old to have the resources to handle the problems of the future, » said Long.

By Viet Duc & Hoang Khanh & Thanh Ha – VnExpress.net – July 17, 2023