NEW YORK (PNN) - January 21, 2013 - Many advanced economies will be threatened by another, long-term fiscal shock unless they tackle the problem of aging populations, the ratings agency Fitch warned on Monday.

“Whilst a successful resolution of the current fiscal crisis remains the most important driver for many advanced-economy ratings, without further reform to address the impact of long-term aging these economies face a second, longer-term fiscal shock,” a Fitch statement said.

Few countries face immediate threats, and reforms implemented by indebted eurozone members such as Greece, Italy and Portugal “have effectively neutralized the long-term impact of aging on public finances in those countries,” it added.

But others, in particular Cyprus, Ireland and Japan, could well see the cost of aging populations jump over the next decade, the agency said, warning that this would affect the sovereign debt ratings of such countries at some point.

“Luxembourg, Belgium, Malta and Slovenia face the most severe impact over the very long term,” Fitch noted.

Based on the agency’s calculations, barring any reforms, debt to GDP (gross domestic product) ratios for the European Union’s 27 member countries would rise by 6.9% by 2020, and by 119.4% by 2050.

“Without reforms to boost labor productivity and/or participation rates in many other advanced economies, population aging will cause potential GDP growth to decline over the long term, exacerbating the fiscal challenge,” Fitch added.