Japan has launched a project to improve the public pension system in Mongolia, sharing its experience in dealing with a rapidly aging society with a country facing a similar demographic shift.
Last autumn, 15 officials from the Mongolian central and local governments in charge of pension policy participated in a seminar in Tokyo sponsored by the health ministry.
In addition, experts from the Ministry of Health, Labor and Welfare and the Japan Pension Service have been stationed in Mongolia to teach local officials how to operate pension systems.
“It is crucially important for any country to establish a solid social security system if the disparity between the rich and the poor is to narrow and its economy is to grow,” said Mamoru Yamashita, a health ministry official who has been stationed in Mongolia under the four-year Japanese project through fiscal 2019, launched at the request of the Mongolian government.
The Japanese project, also sponsored by the Japan International Cooperation Agency, is partly aimed at establishing a better livelihood for nomads in Mongolia whose pension coverage is very low.
Mongolia has a mandatory public pension system for company employees. But nomadic herders and self-employed people participate in pension programs on a voluntary basis.
The number of nomads in Mongolia has been decreasing in recent years as many have abandoned pastoral life following successive natural disasters that have made their livelihoods unstable.
At present, an estimated 270,000 of Mongolia’s 3 million people live as nomadic herders moving from place to place to find pasture for livestock. Of these, only 20 percent are covered by public pensions.
“Livelihoods of nomads will become unsustainable if their animals die due to natural disasters,” a participant in the Japanese seminar said. “Nomadic herding is tough, especially for elderly people, as labor is hard and no leave from work is allowed. That’s why social security is essential to support their lives.”
Under the current pension system, it is difficult for authorities to collect premiums from nomadic herders who travel from place to place throughout the year. In addition, a large number cannot afford to pay.
Under these circumstances, the Mongolian government is considering introducing a universal pension system that covers all people in the country.
“Given aging will advance further in Mongolia, it is meaningful to know what Japan has addressed and will address pension-related issues,” said Basan Batjargal, an official of the Mongolian Labor and Social Protection Ministry who participated in the Japanese study seminar.
A host of problems exists in the Japanese public pension system as well, including sloppy handling of pension records and generational gaps of pension benefits against the background of society’s aging, coupled with a falling birthrate.
“No country has a perfect pension system,” Batjargal said. “We can learn from what Japan has done in the wake of various problems.”
Akihiro Takanashi, an official of the Japan Pension Service, said the study seminar will explain not only the positive aspects of the Japanese pension system but also its problems and demerits. “We want Mongolian officials to decide what to do after analyzing all our system.”