Netherlands tops global pension index as Thailand ranks 41st

Consultancy firm Mercer has released the Mercer CFA Institute Global Pension Index 2025, revealing that the Netherlands remains number one this year. Singapore enters the top tier of the global pension index for the first time, while Thailand ranks 41st, classified in the C group, placing it near the lower end of the scale.

The report assessed the pension systems of 52 economic regions worldwide, using three key criteria: the adequacy of retirement income, sustainability of the system, and the integrity of governance.

In 2009, Singapore scored only a C in this index, but in just over a decade, its rating rose to B+ last year and now reaches A in 2025. Tim Jenkins, a partner at Mercer Sydney and head of the report team, said Singapore has strengthened its pension system consistently over the years, steadily improving its ranking. In recent years, the government has focused more on transparency, helping citizens understand the retirement income they can expect.

Singapore’s pension system is based on the Central Provident Fund (CPF), covering all Singaporean workers and permanent residents. Contributions are mandatory for both employees and employers.

“Singapore has moved fully from a C to an A rating,” Jenkins said. “The country’s strong economy also contributes, as the sustainability component of the index considers long-term economic growth.”

For Thailand, the country remains in the C group, near the lower end of the global index, alongside China, Japan, South Korea, Indonesia, and Vietnam. Thailand ranks 41st out of 52 countries, which is 11th from the bottom.

This year, Thailand’s pension system score improved slightly to 50.6 from 50.0 last year but remains below the global average of 64.5. Thailand made the most progress in the integrity of governance, followed by sustainability, while retirement income adequacy saw a decline.

Within ASEAN, Singapore leads with a score of 80.8 (A), Malaysia follows at 60.6 (C+), Vietnam 53.7, Indonesia 51.0, Thailand 50.6 (C), and the Philippines 47.1 (D), showing that Thailand still lags behind its neighbours in retirement income adequacy, despite improvements in governance.

The report notes that Thailand’s retirement income system consists of four components: a public old-age pension, social security for private-sector employees, voluntary employer-established pension plans such as provident funds, and private savings products.

It further recommends measures to improve Thailand’s pension index, including expanding coverage of occupational pensions, increasing minimum support for the most disadvantaged elderly, reducing public debt relative to GDP, and strengthening regulation of private pension schemes.

The report also warned that rising global economic and political uncertainty is prompting many governments to increasingly use pension fund investments to support domestic policies.

“Government regulations and policy actions, from taxation to investment rules, have a significant influence on how pension funds allocate their investments,” said Margaret Franklin, President and CEO of the CFA Institute.

She added that in some countries, governments are using pension funds as a tool to drive investment for national benefit. However, from an investment expert’s perspective, it is essential to be cautious of unintended consequences that may arise when these regulations or restrictions distort the overall system.