As demographic shifts and technological innovations disrupt the Mexican pensions sector, industry leaders are seizing the opportunity to create a more sustainable and profitable future

Linking the US with Central America, the expansive country of Mexico is the world’s 15th-largest economy and the second biggest in Latin America. Despite ongoing uncertainty surrounding the North American Free Trade Agreement, the Mexican economy has shown remarkable resilience of late, with the IMF expecting the nation to post a steady growth rate of 2.3 percent in 2019.

With a median age of 27.5 years, Mexico boasts a relatively youthful population, and the nation is currently enjoying the economic rewards of this significant demographic dividend. As with many countries across the globe, though, Mexico is facing a rapid shift in its age structure, with the median age projected to increase to 40.8 years by 2050 (see Fig 1). What’s more, the proportion of Mexican citizens aged 65 years or older is expected to reach 25 percent by 2050, reflecting a substantial rise in the number and share of older people in the population.

As life expectancy continues to rise in Mexico, with men living to an average age of 74 years and women to 79.2, citizens are facing an extended retirement period. This, in turn, will require extensive financial planning, as well as access to both state and private pensions. As such, this fast-approaching demographic shift is putting increased pressure on the Mexican pensions system.

Read more @World Finance