Pensions at a Glance Asia/Pacific 2022
Many of Asia’s retirement-income systems are ill prepared for the rapid population ageing that will occur over the next two decades. Asia’s pension systems urgently need to be reformed to ensure that they are both financially sustainable and provide adequate retirement incomes. This report examines the retirement-income systems of 11 non-OECD countries in the region, comparing the results with a selection of OECD countries. The report provides new data for comparing pension systems of different countries. It combines the OECD’s expertise in modelling pension entitlements with a network of national pension experts who provided detailed information at the country level, verified key results and provided feedback and input to improve the analysis.
Gross pension wealth
Replacement rates give an indication of the pension promise relative to individual earnings, but they are not comprehensive measures of cumulated pension payments; they look only at the benefit level relative to individual earnings at the point of retirement, or more generally at a given, later age. For a full picture, life expectancy, normal retirement age and indexation of pension benefits must also be taken into account. Together, these determine for how long the pension benefit is paid, and how its value evolves over time. Pension wealth – a measure of the stock of future discounted flows of pension benefits – takes account of these factors. It can be thought of as the lump sum needed at the retirement age to buy an annuity giving the same flow of pension payments as that promised by mandatory retirement-income schemes.
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