Harnessing a Young Nation?s Demographic Dividends through a Universal NDC Pension Scheme: A Case Study of Tanzania

Bo Larsson, Vincent Leyaro and Edward Palmer

No 136544, Social Protection Discussion Papers and Notes from The World Bank

Abstract: About one-half of Africa?s population will remain below age 30 well past 2050,with relatively few aged 60 and older. Using Tanzania?s projected demographics and presenteconomic point of departure, this paper demonstrates how the implicit ?double?demographic dividend can be harnessed to create inclusive growth. A Swedish-style non financial defined contribution (NDC) system is launched where the government can borrow funds from the future through NDC ?consol? bonds to transform individual savings into human and physical capital to promote inclusive economic growth. The consol bonds constitute a reserve to cover pensions of the retiring ?demographic bubble? in the future as the dependency ratio gradually glides into demographic equilibrium. Minimum transfers tothe current elderly are also introduced with the phase-in.

Keywords: Educational Sciences; Demographics; Labor&Employment Law; Pensions&Retirement Systems; Labor Markets; Rural Labor Markets (search for similar items in EconPapers)
Date: 2019-04-01
New Economics Papers: this item is included in nep-age
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