Hong Kong: The Asian pathfinder
Hong Kong is undergoing a seismic cultural shift with the introduction of its compulsory savings scheme, the Mandatory Provident Fund. Its arrival will boost the local fund management industry through a consistent inflow of funds which employers and workers are legally obliged to maintain. Other Asian countries, most notably China, are scrutinizing its implementation to see what aspect of the Hong Kong model they can adopt. Julian Marshall reports
Tackling the pensions issue is not normally high on politicians' agendas. The accepted view is that it will not win you many votes.
Indeed it is far more likely to lose them for you. Not for nothing has it been dubbed "the third rail on the track" - the electrified one in the middle. Touch it and you die.
So prevalent is this view that the pensions issue has still to be addressed in many countries worldwide, not least in Europe where three of the world's leading economies, Germany, France and Italy, have each yet to come up with a serious solution.
However in Asia, politicians are grasping the nettle. Following in the footsteps of its neighbour and fierce rival Singapore, Hong Kong is taking on the retirement provision problem and it means business. "We are not going to be paper tigers," says Alan Wong, deputy managing director of the Mandatory Provident Fund Authority, which has responsibility for implementing the new scheme.