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Can the Eastern Caribbean Currency Union Afford to Grow Old?
Author:
Mr. Hunter K Monroe
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https://orcid.org/0000-0002-7109-3676
Series:
IMF Working Papers
Volume/Issue:
Volume 2009: Issue 038
Language:
English
Publication Date:
01 Mar 2009
DOI:
https://doi.org/10.5089/9781451871869.001
ISBN:
9781451871869
ISSN:
1018-5941
Pages:
15
Keywords:
WP; ECCU emigration rate; rate; ECCU member; OECD census data; ECCU pension reform; Pension systems; migration; ECCU pension schemes; Pensions; Pension spending; Public sector; Health care spending; Caribbean
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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The demographic transition in the Eastern Caribbean Currency Union (ECCU) now underway is rapid compared with international experience, and emigration is playing a particularly large role. This paper describes and quantifies several factors which could magnify the challenge of pension reform. First, for some ECCU countries, continued emigration at historical rates would considerably advance the projected date at which pension scheme assets are depleted. Second, there is a significant risk that assets will underperform, given the large exposures to the highly-leveraged public sector and to a lesser extent the record with private sector investments. Third, portfolio diversification away from the public sector could be complicated by age-related pressure for greater central government health spending.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund