The Straits Times
www.straitstimes.com
Published on Feb 07, 2013
 
Lee Yi Shyan, Immigration

Ageing Japan offers lesson on consequences of keeping out immigrants: Yi Shyan

 
 

JAPAN’S present struggles illustrate the consequences of a silver tsunami, and provide Singapore with a glimpse of future problems, said Mr Lee Yi Shyan, Senior Minister of State for Trade and Industry as well as National Development.

With Ms Lee Bee Wah (Nee Soon GRC), Mr Lee yesterday warned of the need for Singapore to avoid a similar fate.

With economic recession, higher taxes and fewer job opportunities, Japan – the world’s fastest-ageing country – is paying the price for closing its doors to immigration, said Ms Lee.

Now, some local government and grassroots organisations are advocating welcoming immigrants, she noted.

“Now they try to advocate welcoming immigrants through petitions and open dialogues,” she added.

But she did see some rays of light in Japan’s ageing situation, such as more youths being interested in entrepreneurship – as stable jobs become more difficult to find – and profitable businesses aimed at the silver dollar.

Mr Lee said that Japan’s experience “serves as a useful reference point for us to anticipate our problems going forward” as Singapore’s rate of ageing today is similar to Japan’s in 1984.

He painted a bleak picture of life in Japan’s smaller, ageing cities, where shops are either closed or mainly selling goods for the elderly, and young people leave for opportunities in the big cities.

In Yubari, Hokkaido, a small working population meant a “measly tax base”, leading to an 18-year austerity drive which saw the town’s civil service halved, six primary schools merged into one, and the shutdown of hospital facilities.

This story was one repeated across the country, said Mr Lee.

Low fertility plus no immigration have caused Japan’s workforce to shrink since 1996. Economic stagnation has seen public spending soar while tax revenue falls.

“The huge silver tsunami is destabilising Japan, so why doesn’t it increase its working population to maintain a vibrant economy?” asked Mr Lee.

The answer, he said, was simple: “Japan couldn’t build a consensus to allow immigration to boost their workforce.”

He noted that as Singapore ages, its old-age support ratio will fall to 2.1 working citizens for each elderly person. He asked if this “unbearable” burden on the young will be sustainable. Singapore cannot even assume that young people will stay, he added. Competition for talent will increase, not least from cities in the region.

Singapore thus needs to prepare for the silver tsunami now: not just by building up infrastructure, but also by striking a balance between “catering to the present needs and saving up for the future”.

In doing this, he added, Singapore should avoid the experience of another East Asian neighbour: Taiwan, where welfare spending has outstripped public means.
“The experiences of other countries in coping with low fertility, ageing population and rising social expenditure are instructive,” said Mr Lee. “Let us learn the lessons well.”