Seizing the Demographic Dividend: Seeing Korea is Believing!

Evidence of Korea’s economic transformation can be seen in the development of downtown Busan.

“At the time of independence in 1963, Kenya and Korea were at the same level of economic development.”

When I first heard this statement—from my development economics professor at the University of Nairobi—I admit that it did not strike me as much. However, after returning from a week in Busan, Korea, where I attended the International Union for the Scientific Study of Population’s (IUSSP) 27th International Population Conference, I am stunned by the comparison.

Kenya_vs_Korea_GDP-01
Source: United Nations Population Division, “World Population Prospects, the 2012 Revision”

My professor’s assessment was based on the fact that in the early 1960’s, Kenya and Korea were both poor countries, each having a gross domestic product (GDP) per capita of around $100. Fifty years down the line, things have changed dramatically. Korea is currently classified as a high-income country by the World Bank. With a GDP per capita of about $ 23,000, this East Asian Tiger has had remarkable economic growth and development, and boasts impressive socio-economic indicators. Some of the results of this transformation are quite evident in Busan—fancy sky scrapers, elegant transportation systems, giant shopping malls, not to mention the Samsungs and Hyundais. On the other hand, Kenya has remained a poor country, with a GDP per capita of $800.

Reaping the Dividends

Korea’s impressive economic performance has been credited to robust economic policies geared towards export-oriented manufacturing industry with progressive investments in education, technology and infrastructure.

However, one of reasons which was not mentioned by my economics professor, but deserves attention, is Korea’s ability to reap the demographic dividend. The demographic dividend is the accelerated economic growth that can result from changes in a population’s age structure. When fertility declines, and women have fewer births each year, a country’s young dependent population grows smaller in relation to the working-age population. With fewer people to support, a country has a window of opportunity for rapid economic growth if the right social and economic policies and investments are made.

For this window to exist, fertility has to decline.  Between 1950 and 1975, Korea’s fertility began to decline rapidly—from 5.4 children per woman to 2.9—eventually dropping to 1.2 in 2005. Korea’s success was the result of specific interventions that contributed to rapid and sustained fertility decline, like the expansion of family planning beyond health centers to include home visits/outreach, active behavior change campaigns and subsidized health care.

Source: World Development Indicators, The World Bank
Source: World Development Indicators, The World Bank

In Kenya, fertility has not declined as much. In 1978, Kenya had the highest fertility rate in the world at 8.1 children per woman. This propelled the country’s population growth at a time when the country was witnessing large declines in child mortality. Since then, Kenya’s total fertility rate has dropped to 4.6 children per woman.

Kenya is frequently named as one of the countries in sub Saharan Africa that is poised to take advantage of the window of opportunity to realize the demographic dividend. To do this, there are many lessons that this east African nation can take from the East Asian tiger. Sound socio-economic policies are a must for sustained economic growth and are needed now. So is the decline in fertility. The good news is that the demand is there—beyond current contraceptive users, an additional 26 percent of married women have an unmet need for family planning in Kenya. In other words, they want to delay or limit childbearing but lack contraception. Investments in voluntary family planning and reproductive health need to be a priority in national development planning, with adequate resources allocated for implementation.

It can happen in Kenya. I have seen it in Korea. Not that I ever doubted the demographic dividend, but seeing really is believing.

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