Demography is destiny: Preparing Southeast Asia to become the Indo-Pacific’s growth centre
By Gemma King
Looking towards the future of the Indo-Pacific, demographic trends will be the driving force behind economic and social change.
Unlike some other regional developments, the unique advantage of demographic data is that it allows us to pre-empt what the future of our region will look like and prepare accordingly.
As some Indo-Pacific countries see an increase in their youthful populations, others will experience aging – and even declining – populations. Countries with younger populations, and therefore a larger workforce, will experience significant economic growth that has the potential to transform the Indo-Pacific.
The Indo-Pacific region is sitting on a goldmine of untapped economic potential in Southeast Asia.“
We are already beginning to see major Indo-Pacific demographic shifts, with Southeast Asia on the cusp of a significant demographic dividend. It is already home to a sizable young labour force of 470 million people (aged 15-64), and this is number is projected to peak by 2050 at 510 million.
Indonesia is a major contributor to this growth – its labour force will increase to 205 million by 2050. Its close neighbours will follow similar trendlines – the number of young people in the Philippines, Malaysia, Laos and Vietnam is steadily increasing and is also expected to peak in 2050.
We shouldn’t underestimate the power of Southeast Asia’s demographic dividend in radically altering the Indo-Pacific. As the centre of regional economic productivity begins to move away from Northeast Asia, the region itself will become more multipolar and ASEAN will emerge as a more significant player.
But these changes won’t just happen on their own. Taking advantage of Southeast Asia’s demographic dividend – and its expanding working age population – will require deliberate and careful policymaking.
If prepared for properly, Southeast Asia promises to bring significant economic productivity. But if this population growth isn’t accompanied by equitable development – including creating enough jobs and equipping people with the skills they need – the Indo-Pacific’s future isn’t so bright.
Australia and other regional countries have a vested interest in the future prosperity and stability of Southeast Asia. We have a role to play in facilitating the economic growth of our near neighbours – and we should be paying attention to their economic priorities so that we can join in on this growth. If we don’t, the region may face social and political instability.
In Southeast Asia, governments are beginning to identify priority areas to meet their development goals. Indonesia is looking to significantly boost its skilled workforce, and it will need the help of other countries to meet its goals. Partner countries like Australia will be critical for developing these skills – our world class education services can meet Southeast Asia’s demand.
Harmonised partnerships like this will be the key to unlocking a future where Southeast Asia becomes the epicentre of Indo-Pacific growth. It is now up to governments, businesses and industry to understand the priorities of our regional neighbours, and work with them to reach their goals.
Our region is at a crossroads. Now is the time for us to begin seriously investing in Southeast Asia to ensure we see a region characterised by prosperity, not instability.