Generation 2050

Growing evidence suggests that investing in the human capital of children and young people contributes to sustained economic growth and political stability. Whilst it is often seen as a cost, investing in the human capital of children and youth should instead be seen as a public investment, since it generates returns to society through higher economic growth. It also avoids social costs associated with negative conduct and low social capital accumulation, which impose both direct and indirect costs on societies in future. Furthermore, human capital development investments are cumulative, since investments made early in a person’s life have more time to materialise.

The Central Asian region has a unique opportunity to harness a “demographic dividend”. Over 50% of the population is under the age of 30. In the next two decades, this cohort will form the largest labour force the region has ever seen, both in terms of absolutely numbers as well as the percentage of the population that is of working age. This presents an opportunity for a demographic dividend, where a higher ratio of working-age individuals to dependents can lead to increased disposable income, fueling consumption, production, investment, and accelerated economic growth. However, realising these benefits requires deliberate action and strategic investments, as the demographic dividend is not automatic.

Central Asian countries risk missing the opportunity for accelerated economic growth, due to underdeveloped human capital. The World Bank’s Human Capital Index measures a country's expected productivity of its next generation of workers, based on their health and education outcomes. This index ranges from 0.6 for Kazakhstan, Uzbekistan, and the Kyrgyz Republic to 0.5 for Tajikistan. This means means that children born in Central Asia today will be only 50-60% as productive when they grow up as they would be if they had access to complete education and full health. Furthermore, underinvestment in areas such as child protection, social protection, water and sanitation, and active labour market measures also contributes to lower human capital in Central Asia. The right human capital investments could significantly increase the region’s human capital, ensuring the region capitalises on its demographic advantages.

Within this context, this study quantifies future demographic challenges and proposes actionable policy and investment strategies to ensure the demographic dividend is achieved. This study will include a comprehensive analysis of demographic projections for children, adolescents, and youth in the five Central Asian countries over the next 25 years (2025-2050). It will also determine the level of investment needed to leverage the demographic potential of the region via investments in core services for children.