Handling aging together

Demographic differences create new sources of regional comparative advantage

For much of the past 35 years, cooperation between China and the Association of Southeast Asian Nations has evolved by responding to changing economic realities. It began with trade liberalization and expanded through investment and regional production networks. More recently, digital connectivity and technological innovation have become new engines of cooperation.

Perhaps the next chapter will be written not by markets alone, but by demographics.

Population aging rarely dominates discussions on regional economic cooperation. It is usually treated as a domestic issue, associated with pension reform, healthcare costs and shrinking labor forces. Yet China and ASEAN have reached a stage where demographic change can no longer be read only in the context of national borders. The region has become too economically integrated for that.

China has entered a moderately aging society. According to the 2025 National Report on the Development of Aging, jointly released by the Ministry of Civil Affairs and the China National Committee on Aging, China's population aged 60 and above reached 323.38 million by the end of 2025, accounting for 23 percent of the country's total population. Across ASEAN, the transition is unfolding at different speeds. Thailand and Singapore have already become aged societies, while Vietnam, Malaysia and Indonesia, despite having different demographic clocks, are moving in the same direction.

That timing matters.

Economists have long explained regional integration through comparative advantage. Countries trade because they possess different combinations of labor, capital, natural resources or technology. These differences create mutual gains from exchange.

Demographic transition suggests another source of comparative advantage.

The demographic challenges that China is confronting today are those that several ASEAN economies are likely to face over the next one or two decades. Rather than seeing this difference as a divide, it can be viewed as an opportunity. Experience acquired today in one country becomes useful knowledge for another tomorrow. Policy innovation, healthcare reform, workforce adaptation and technological solutions become resources that can be shared.

Comparative advantage, in other words, may increasingly arise not only from differences in economic resources, but also from differences in where countries stand along the same demographic journey.

This idea deserves greater attention because demographic transition is reshaping almost every part of the economy.

Healthcare is perhaps the most visible example. Aging populations require more continuous care, better management of chronic diseases and greater access to medical services outside major cities. Artificial intelligence is often discussed as a technology that replaces workers. In aging societies, however, it can play a major part by helping a limited number of healthcare professionals serve a much larger population through better diagnostics, medical imaging and telemedicine.

The same logic applies to the labor market. Longer life expectancy also means longer careers. Workers entering their sixties today are often healthier, better educated and more capable of remaining economically active than previous generations. The challenge is no longer whether they can continue working, but whether they can continue learning. AI-supported education platforms make lifelong learning more flexible and affordable, allowing workers to adapt to changing technologies without repeatedly leaving the labor market.

The economic implications extend further.

Population aging is changing patterns of demand throughout Asia. Healthcare services, rehabilitation, assistive technologies, age-friendly housing, financial planning and digital services for older adults are becoming important sources of business activity. The silver economy should not be viewed simply as the cost of supporting older populations. It also represents a growing market capable of generating innovation, investment and employment.

This is where China and ASEAN complement each other particularly well.

China has accumulated considerable experience in digital infrastructure, AI applications and smart manufacturing. ASEAN contributes dynamic markets, expanding digital economies and countries that are progressing through demographic transition at different stages. That diversity allows governments, businesses and researchers to learn from one another instead of repeatedly solving the same problems independently.

The completed negotiations on the China-ASEAN Free Trade Area Version 3.0 illustrate how regional cooperation continues to evolve beyond tariff reduction toward the digital economy cooperation and institutional coordination. Demographic cooperation fits naturally within this broader agenda.

One practical step would be to establish a China-ASEAN partnership for healthy aging. Rather than creating another regional institution, such a partnership could build on existing cooperation mechanisms to encourage joint pilot projects in AI-enabled healthcare, collaborative research on aging technologies, workforce reskilling and policy dialogue on long-term care. The objective would not be technology for its own sake, but practical solutions that improve people's daily lives.

Ultimately, the success of China-ASEAN cooperation should not be measured only by trade volumes or investment flows. It should also be measured by whether the partnership helps both sides respond more effectively to shared structural challenges.

Population aging is one of those challenges, but it is also an opportunity to rethink regional cooperation.

For decades, economists have understood comparative advantage in terms of what countries possess. The next stage of China-ASEAN cooperation may depend just as much on where countries are — not on the map, but along the path of demographic transition.

Knowledge can travel before demographic pressures do. Policies can be tested before they become urgent elsewhere. Innovation can spread before problems become crises.

Trade has connected China and ASEAN. Shared prosperity has strengthened that partnership. Handling aging together may become the next reason to deepen it.

Nisit Panthamit is an associate professor of economics and the director of the Center for ASEAN Studies at the Faculty of Economics at Chiang Mai University, Thailand. Sun Yangyang is a doctoral candidate at the Faculty of Economics at Chiang Mai University, Thailand. The authors contributed this article to China Watch, a think tank powered by China Daily.

The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn.