Kazakhstan ranks 24th in the 2024 Mercer CFA Institute Global Pension Index, surpassing several major economies including the U.S. and Saudi Arabia. The index evaluates pensions on adequacy, sustainability, and integrity, with Kazakhstan receiving a C+ rating. Though strong in sustainability and integrity scores, there is a need to improve adequacy, particularly by reducing pre-retirement access to funds and boosting older worker participation.
Kazakhstan has achieved a commendable 24th place among 48 countries in the 2024 Mercer CFA Institute Global Pension Index (MCGPI), as announced on October 15. The Unified Accumulative Pension Fund (UAPF) of Kazakhstan reported that the index evaluates pension systems using three primary categories: adequacy, sustainability, and integrity, which consist of over 50 indicators. Kazakhstan excelled in sustainability and integrity, receiving high scores of 73.1 and 80.4, respectively, while adequacy received a score of 45.8. Overall, the country accumulated 64.0 points resulting in a C+ rating, outperforming notable economies such as the U.S., Spain, Japan, South Korea, China, and Saudi Arabia. The results indicate that while Kazakhstan’s pension system demonstrates robust sustainability and integrity, there remain areas requiring enhancement, particularly in adequacy. The index identified the enhancement of the pension system as essential, especially given demographic trends that show decreasing birth rates coupled with increasing life expectancy. The recommendations from the Mercer CFA Institute emphasize reducing pre-retirement withdrawals from private pension funds and encouraging greater labor force participation among older individuals, a critical measure as life expectancies continue to rise.
The Mercer CFA Institute Global Pension Index is a leading global benchmark that evaluates pension systems on an annual basis, focusing on their ability to deliver adequate income for retirees. The index compares the performance of pension systems from various countries, utilizing sub-indices that measure adequacy, sustainability, and integrity. As demographics evolve with declining birth rates and increased life expectancy, pension systems worldwide face challenges in ensuring financial stability for future retirees. Kazakhstan’s inclusion in this index reflects its ongoing efforts to strengthen its pension framework in alignment with these global trends.
In conclusion, Kazakhstan’s performance in the 2024 Mercer CFA Institute Global Pension Index highlights significant progress in its pension system, particularly in sustainability and integrity. However, the adequacy of the pension framework remains a pressing concern. By addressing these vulnerabilities through strategic changes, such as limiting access to private funds prior to retirement and enhancing the participation of older workers in the labor force, Kazakhstan may further improve its standing in future evaluations. As global demographics shift, the continuous adaptation and improvement of pension systems are increasingly critical.
Original Source: astanatimes.com
