From the Jamestown Foundation's China Brief, February 11:
Chinese Demographic Signals Bode Ill for Future Development
A new study published February 8 by the Ministry of Public Security of the People’s Republic of China (PRC) (MPS, 中华人民共和国公安部, zhonghua renmin gongheguo gongan bu) reported that there were 10.035 million registered births in 2020, down from 11.79 million in 2019. This represents a 15 percent decrease following the coronavirus pandemic (Guancha.cn, February 8). Although the number of registered births—that is, newborns recorded in the household registration hukou (户口) system—is not the same as China’s official birth rate, the decline has concerned analysts that a long-forewarned demographic crisis may be approaching faster than expected.National birth and population figures for the previous year are usually released in January but have been delayed until April this year as China’s National Bureau of Statistics (NBS) compiles its decennial census. In the meantime, data released by some provinces and cities in January has appeared to confirm the implications of the MPS study. Data released from the capital city of Guangdong province—which saw the highest number of births per province in 2019—showed that birth rates in Guangzhou were down by 17 percent year-on-year and mirrored broader trends across the rest of the province. In Zhejiang, China’s wealthiest province, the cities of Wenzhou and Taizhou reported that new births in 2020 fell by 19 percent and 33 percent respectively compared to 2019 (SCMP, February 2).
These statistics belayed earlier optimism that the pandemic could have fueled a ‘quarantine baby boom’ that would have helped offset years of birth rate decline (CGTN, October 29, 2020, Yicai, January 31). And although China was the only major economy to experience GDP growth last year, the demographic data has sharply exposed the fragility of its recovery from COVID-19 as well as underscoring long-term weaknesses in its labor market that bode poorly for future development.
Entering the “Low Fertility Trap”
Even before the pandemic, official statistics showed that China’s birth rate had declined for three years. In 2019, NBS reported that the total number of new births was 14.65 million, which was itself the lowest number seen since 1961. It is plausible that the total number of births in 2020 will be the lowest on record since China became a nation-state in 1949. Independent analysts have argued that the situation may be even more severe that official numbers indicate and that the 2015 reform of national family planning policy did little to ameliorate ongoing factors contributing to birth rate decline, including high costs of childcare; a serious demographic contraction following the implementation of the One Child policy in 1980 and ongoing efforts to repress ethnic minorities stunting population growth in lower-income western regions (China Brief, February 28, 2020; Jamestown Foundation, July 21, 2020).
Experts worry that China may have fallen into the so-called “low fertility trap,” in which self-reinforcing mechanisms lead to continuous birth decline (SCMP, February 9). Demographers generally hold that the replacement level fertility rate—defined as the average number of children born per woman—necessary to sustain existing population levels should be about 2.1. But the World Bank has pegged China’s fertility rate at under 1.7 since 1995 (World Bank, accessed February 9). Although positive migration has allowed China’s total population to continue growing thus far, a report by the state-affiliated Chinese Academy of Social Sciences (中国社会科学院, zhongguo shehui kexueyuan) estimated that China will begin to see negative population growth as early as 2027 (CASS, January 4, 2019). More pessimistic analysis by the Evergrande Research Institute (恒大研究院, hengda yanjiuyuan) has predicted that negative growth will begin during the 14th Five Year Plan (2021-2025) (FYP) (Yicai, February 3). Even the most conservative experts have begun to signal their concerns about these population changes: in December, the president of the China Population Association (专访中国人口学会, zhuanfang zhongguo renkou xuehui) said in an interview that the national family planning policy should be changed and the population be allowed to make their own decisions regarding childbirth during the 14th FYP (Jiemian News, December 15, 2020).
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A Silver Wave
China’s birth rate crisis has been paralleled by the simultaneous and related problem of a rapidly aging population. According to a report by the Ministry of Civil Affairs (MCA, 中华人民共和国民政部, zhonghua renmin gongheguo minzhengbu), the number of people over the age of 65 in China will hit 300 million during the 14th FYP (The Paper, October 23, 2020). A more pessimistic projection by the Evergrande Research Institute suggests that China will become an aged society—defined by the UN as a society in which more than 14.3 percent of the country’s population is over the age of 65—by 2022 (Evergrande, accessed February 11)....
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Meaning there will be opportunity but I'm not sure how best to approach it.
From Protocol Magazine, February 2:
China's Big Tech goes for the Big GreyThere's a huge, growing, rich tech market finally being tapped: China's seniors. What can the West learn from early wins?
