Impact of Aging Populations on Global Economies and Stock Markets: Insights and Trends

Ankara: The issue of rapidly aging populations is set to have a significant impact on economies and stock markets globally, with countries like Thailand already experiencing the effects of an aging society. The phenomenon is driven by younger generations reluctance to have children, resulting in a dramatic increase in the average lifespan of citizens.According to Thai News Agency, research conducted on 15 countries highlights the economic implications of aging populations. Japan, with nearly 30% of its population aged over 65, has experienced low GDP growth of 0.9% annually over the past decade. Despite this, the Japanese stock market has performed well, with a 10-year compounded return of 8.6%, attributed to reforms by former Prime Minister Shinzo Abe.Other developed nations with high aging rates, such as Italy, Germany, and France, exhibit similar trends. Italys GDP growth has been a mere 0.6% annually, while its stock market has seen a 4.8% increase over the past decade. Germany and France have also experienced low GDP growth of 0.9-1.0% annually, yet their stock markets have shown significant gains, with Germany achieving a 9.3% annual return.Countries like Spain, South Korea, and the UK, with aging populations around 19-21%, have seen slightly better GDP growth at 1.5-2% annually. However, their stock market returns have been relatively poor, reflecting downturns in their respective markets.In contrast, the United States, Australia, and Singapore, with younger populations, have demonstrated higher GDP growth rates of 2.1%, 2.2%, and 2.5%, respectively. The US stock market, in particular, has delivered outstanding returns, compounding at 11.2% over the past decade, suggesting resilience against potential aging-related economic challenges.Developing countries like Thailand, Vietnam, Indonesia, and Malaysia present varied scenarios. Thailand, with 15.4% of its population aged over 65, has experienced low GDP growth of 2.8% and negative stock market returns over the past decade. Conversely, Vietna m, with a younger population, has achieved impressive GDP growth of 8-9% annually.The study concludes that GDP growth in aging societies tends to be slower, as a declining working-age population leads to reduced national production and income. However, stock market performance does not necessarily stagnate in aging societies, as seen in Japan and Germany, where markets have recovered after periods of decline.Reflecting on these findings, there is hope that Thailand and similar countries can stabilize GDP growth and witness a recovery in their stock markets in the coming decade, turning the current economic challenges into opportunities for growth and stability.