May 2024

Rethinking the route to retirement investing

At any time in an economic cycle, keeping watch on how retirement portfolios are positioned is good practice. On the back of the relentless swings in asset prices, which investors have endured for so many months, it is vital. Recent market sentiment, as well as fund flows and performance, can attest to this. Take China and Hong Kong equities, for instance. In April, the Hong Kong and Greater China equity markets were the only asset classes posting positive returns, with...

Developing Asia and the Pacific Unprepared for Challenges of Aging Population

Developing Asia and the Pacific is unprepared to secure the well-being of its rapidly aging population as the growing share of older people in the region face challenges from low pension coverage to health problems, social isolation, and limited access to essential services. While longer lifespans reflect the region’s development success, comprehensive policy reforms are urgently needed to support the welfare of older people, according to Aging Well in Asia: Asian Development Policy Report, released today by the Asian Development Bank...

December 2023

Social Protection for Older Persons Social Pensions in Asia

By Sri Wening Handayani & Babken Babajanian The rising number of older persons in Asia has accentuated the importance of strengthening the systems of social protection in the region. This book examines the effectiveness and relevance of noncontributory or social pensions in supporting older persons in Asia. It discusses the political economy and financial sustainability of social pension reform, implications for gender equity and social rights, and design and implementation challenges. Case studies from Bangladesh, Nepal, Thailand, Viet Nam, and South...

October 2023

Large parts of Asia are getting old before they get rich

A bulge in a country’s working-age population is a blessing. Lots of workers support relatively few children and retired people. So long as the labour market can absorb a surge of job-seekers, output per head will rise. That can boost savings and investment, leading to higher economic growth, more productivity gains and developmental lift-off. Yet for countries that fail to seize this opportunity, the results can be grim—as many developing countries may soon discover. Consider Thailand. It is rapidly greying....

Asia pension funds increase share of alternative assets

Asian pension funds are aggressively diversifying their portfolios to include alternative investments in a bid to circumvent the volatility of traditional asset classes and manage liabilities more efficiently. A new report by Cerulli Associates found a rising trend of pension funds seeking more stable returns across market cycles and additional income avenues such as private credit and real assets. “The potential to deliver strong absolute and risk-adjusted returns and beat inflation are key reasons Asia-Pacific ex-Japan pensions are investing in alternatives,” Shaun Ng,...

Asian Retirement Markets 2023: Building Security Against Uncertainty

By Shaun Ng As Asia’s retirement pension funds evaluate the funding status for the many approaching their golden years, alternative investments offer diversification and returns. Major pension funds in Asia have been diversifying further into alternatives, driven by the need to deliver solid returns and combat inflationary pressures as they face a looming underfunding crisis. However, nearly 41% of Asian pensions surveyed by Cerulli cite a “limited understanding” of alternatives, while one-third say they lack in-house expertise when investing in alternatives....

Inflation concerns drive Asia-Pacific pension funds to alternatives

Pension funds in Asia-Pacific are planning to increase allocations to alternatives to hedge against inflation, but they lack the expertise and understanding to manage these assets in-house, according to a Cerulli Associates report. Between 2020 and 2022, these pension funds increased allocations to alternative assets by 28.4%, and are looking to outsource their alternative investments — particularly to hedge funds, private equity and private debt, according to The Cerulli Report — Asian Retirement Markets 2023: Building Security Against Uncertainty. Figures...

August 2023

Dutch pension funds slash €28bn of Asian investments

Sales and losses have led to allocations to the region falling by more than a fifth in 15 months. Allocations to Japan, and Taiwan were the most affected, according to central bank data. A combination of sales and losses have seen Dutch pension fund allocations to Asia fall by €27.5 billion ($30.3 billion) since the last quarter of 2021. Asia allocations by the industry in the first quarter of 2023 totalled €106.6 billion, down from €134.1 billion 15 months earlier, a...

May 2023

A zoom into Asia’s pension reform journey: different perspectives of a multi-pillar approach

By Calvin Chiu & Elvin Tharm Pension reform in Asia is progressing as the region faces numerous challenges: ageing populations, rising life expectancy and the erosion of traditional family and community support for the elderly. While the traditional state-provided pension may provide one potential source of retirement income, Manulife Investment Management believes that a comprehensive multi-pillar approach, such as that outlined by the World Bank, should be the best way forward. In this initial paper of a new series on...

March 2023

European pensions increase ESG pressure on Asia property funds

Adoption of a real estate benchmark in Asia is increasing as leading European pension funds place reporting at the heart of their emissions reduction efforts. Pressure from investors outside Asia is increasing the quality and range of ESG data reported by Asian property funds, according to the leading global ESG benchmark for real estate. “There is increased pressure from asset owners who require their managers to participate in the annual benchmark, although this pressure mostly comes from non-Asian asset owners,”...