The Implications Of A Shrinking Chinese Population

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Credit: Joseph Chan/ unsplash
  • China has entered a period of “negative population growth”.
  • The UN projected the population would peak in 2031-32.
  • Despite major government efforts to reverse the trend, China has now begun what is expected to be a long period of population decline.

The ongoing shift in demographics could have a profound effect on everything from how the economy operates to Xi Jinping’s legitimacy. The Guardian spoke to experts about the implications for everything from climate change to the Chinese Communist party.

Climate Change

There has long been talk of the need for economic restructuring through a gradual shift towards higher value, cleaner, more advanced hi-tech and services sectors, away from dirtier, low cost, high volume, low value addition manufacturing jobs. This demographic trend further reinforces the idea that it is about the quality of economic growth not just the quantity of brute output. The good news is that moving away from fossil fuel and pursuing what China termed ‘ecological civilisation’ would help China improve the quality of its economic growth.

Women’s Rights

“To boost fertility rates, the government should take measures that mitigate the motherhood penalty, i.e, offering women with children benefits and protections in the workplace, so that they would not be afraid of being penalized at work because of marriage and childbirth…” says Yige Dong, assistant professor in the department of global gender & sexuality studies, University at Buffalo, SUNY. 

What has been happening is that, on the one hand, experts and policymakers are encouraging young people, especially women, to get [married] earlier and have more children – which does not seem to work and on the other hand, employers are discriminating against women as they are perceived to have more care burdens and are thus deemed as secondary workers.

Superpower Status

“China’s population decline and aging population … is a reminder of America’s great advantage in being open to talented, hardworking immigrants from around the world.” Susan Shirk, author of Overreach: How China Derailed its Peaceful Rise. The slowdown in Chinese economic growth is an interesting real world experiment in whether economically successful countries appear more threatening than ones that are struggling. Are external threat perceptions driven more by a country’s policies and actions or by its economic capabilities?

Global Economy 

In the short term, a reopening Chinese economy should provide an important source of strength for the rest of the world economy this year at a time when major western economies are grappling with higher inflation and interest rates and the war in Ukraine.

“Beyond the next year or so however, the ability of the Chinese economy to be the engine of global growth that it has been in the past looks increasingly in question.” Roland Rajah, director of the Indo-Pacific Development Centre at the Lowy Institute.

The Chinese Economy

“For China, the speed at which the population is aging whilst it transitions to a middle-income economy is one of the concerns … China will get old before it gets rich…” Dr Jennifer Hsu, research fellow at the Lowy Institute.

China’s working age-to-dependency ratio increased from 37% in 2010 to 45% in 2021, meaning that for every 100 people, 45 required support. Working age is defined as ages 15 to 64. This demographic trend can also be expressed in the worker-to-retiree ratio. In 2020, there were 3.74 working-age people per retiree, but this ratio is projected to decline to 1.68 by 2045.

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Source: Theguardian

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