Kazakhstan Achieves 24th Place in Global Pension Index, Surpassing Major Economies
Kazakhstan has ranked 24th in the 2024 Mercer CFA Institute Global Pension Index, outperforming major global economies like the US and Saudi Arabia. With scores of 45.8, 73.1, and 80.4 across adequacy, sustainability, and integrity respectively, it received a C+ rating. Recommendations to enhance the system include minimizing pre-retirement fund access and increasing older worker participation as life expectancy rises.
Kazakhstan has secured the 24th position out of 48 in the Mercer CFA Institute Global Pension Index (MCGPI) published on October 15, reflecting notable advancements in its pension system. The assessment, conducted by the nation’s Unified Accumulative Pension Fund (UAPF), utilized a comprehensive framework of over 50 indicators categorized into three sub-indices: adequacy, sustainability, and integrity. Kazakhstan’s scores were impressive, registering 45.8 points for adequacy, 73.1 for sustainability, and 80.4 for integrity, culminating in a total score of 64.0 points and a C+ rating, outpacing countries such as the United States, Spain, Japan, South Korea, China, and Saudi Arabia. Despite these commendable scores, the report notes that Kazakhstan faces challenges in enhancing its pension system, which remains the most vulnerable aspect of its score. Recommendations from the Mercer CFA Institute emphasize the importance of reducing pre-retirement withdrawals from private pension funds to bolster financial sustainability. Furthermore, they advocate for increasing labor force participation among older populations, recognizing the need to adapt to rising life expectancies. The findings highlighted by the MCGPI underscore the pressing necessity of improving pension frameworks in light of demographic trends such as declining birth rates coupled with increasing longevity. In a significant observation, the World Economic Forum noted, “there are now more people over the age of 65 than there are under the age of five — a dispersion that’s never occurred before.” This demographic shift places further urgency on reforms within pension systems globally.
Understanding the intricacies of global pension systems is crucial for assessing their effectiveness in safeguarding retirees’ financial security. The Mercer CFA Institute Global Pension Index (MCGPI) evaluates various pension schemes across multiple nations, providing insights into their strengths and weaknesses. This year, Kazakhstan has showcased a significant performance, indicating the improvements made in its pension policies and the shifting demographics that necessitate such progress.
In conclusion, Kazakhstan’s notable ranking in the Global Pension Index indicates significant advancements in its pension system, though challenges remain, particularly in the area of adequacy. The recommendations from the Mercer CFA Institute highlight solutions that could further enhance the sustainability and integrity of the pension system, which is essential given the changing demographic landscape. By implementing these recommendations, Kazakhstan can better prepare for future needs in pension financing and support for its aging population.
Original Source: astanatimes.com
