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Pension Fund Industry in Thailand

Pension Fund Industry in Thailand. Chaibhondh Osataphan Chairman Association of Provident Fund Manager Thailand. First International Pension Fund Conference 13-14 April 2000 Hotel Ritz, Madrid, Spain. Thailand’s Population and Labor force. Total Population = 61.0 million

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Pension Fund Industry in Thailand

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  1. Pension Fund Industry in Thailand Chaibhondh Osataphan Chairman Association of Provident Fund Manager Thailand First International Pension Fund Conference 13-14 April 2000 Hotel Ritz, Madrid, Spain

  2. Thailand’s Population and Labor force Total Population = 61.0 million Non-Labor Force = 28.2 million Labor Force = 32.8 million Life expectancy: M=68yrs F=72yrs Labor Force 12.6 million 4.6 million 10.2 million 2.6 million 2.8 million

  3. Demographics 1999 2020 3 workers: 1 retiree 6 workers: 1 retiree

  4. 1st pillar-Old Age Pension Fund - 5.6 mi. people ~8.8 billion Baht 2nd pillar-Gov. Pension Fund - 1.1 mi. people ~117.4 billion Baht 3rd pillar-Gov. Permanent Employees Fund - 0.1 mi. 3rd pillar-State-Owned Enterprises Fund- 0.2 mi. 3rd pillar-Private sector Fund-0.7mi. Total -7million people(23% of labor force) 304.4 billion Baht (No coverage for Self Employed &Agri. Sectors) (US$ 8 Billion) 6% of GDP The Current Pension Programs in Thailand ~178.2 billion Baht

  5. 3rd pillar- Pension Funds’ Investment Portfolio As at December 31, 1999 Total Investment : 178,162.27 million Baht (~4.69 billion US$) Invested in domestic market only

  6. MAIN CONCERNS&FUTURE REFORM • CONCERNS: • Allows cross border investment. • Mobility of pension fund. • Individual choice of investments. • Minimum vesting schedule for employer contributions. • Provides annuities insurance . • Individual Retirement Fund. • FUTURE REFORMS: • Raise normal retirement age from 55 to 60 for 1 st pillar • Extends coverage of 1 st pillar to smaller employers & self employed. • Introduce 2nd pillar for private sector.

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