Having replaced its one-child policy with the two-child policy, China expects to abolish population control soon. Yi Fuxian, a senior scientist at the University of Wisconsin-Madison, however, says the impact of the one-child policy on China’s economy, society, politics and national mentality will last for a long time. In an article in the South China Morning Post (December 12) he attributed the slow down in GDP from 10 per cent in 2011 to 6 per cent in 2019, to the one-child policy which in that period shrank the prime-aged labour force of 18-59 year-olds. Yi Fuxian said China’s demographic structure in 2035 will be similar to that of Japan’s in 2018, which means China’s economic growth will continue to decline. In northeastern China – Heilongjiang, Liaoning and Jilin provinces – where the fertility rate has fallen sharply below the national average, the economic engine has stalled. Despite official boasts of 5 per cent annual GDP growth, the fourth national economic census showed that the region’s GDP in 2019 was the same size as in 2012 – meaning zero growth for seven years. The one-child policy has reduced family size and needs leading to a drop in China’s household consumption while savings rates have risen. Much of these savings, in the absence of other investment options, has gone into property, which led to high housing prices. In 2018, China’s household consumption accounted for only 39 per cent of GDP, while in India and the United States, consumption accounted for 59 and 68 per cent of GDP respectively. The one-child policy has also undermined Chinese traditional family values and changed child-bearing attitudes. A generation of children who grew up with no siblings often have much less experience in sharing and compromise. Since 2002, China’s divorce rate has increased threefold and is now twice that of Japan’s. Many Chinese people have been taught, since kindergarten, to have only one child or none at all. The two-child policy was only implemented in 2016 and the number of births was expected to peak in 2018, but even according to the overestimated data in the Health Statistics Yearbook, the number of live births in 2018 was only 13.6 million, far less than the official 2014 forecast of 50 million and the 2016 forecast of up to 22 million. China is making more of everything except babies. China’s state pension age has remained unchanged for more than four decades at 60 for men, 50 for ´╗┐women in blue-collar jobs and 55 years for ´╗┐women in white-collar jobs, but since the ageing of China's population is serous so the Chinese pension age must eventually be raised significantly. This, Yi Fuxian said, may trigger public protests and even lead to social instability. China’s lack of young consumers has led to overcapacity. Parents in China also worry that their only child will be unable to support them later in life, so consume less and save for their retirement. With more than 100 million surplus labourers, China has intentionally or unintentionally pursued a trade surplus to digest its excess capacity.

Subscribe to Newswire | Site Map | Email Us
Centre for China Analysis and Strategy, A-50, Second Floor, Vasant Vihar, New Delhi-110057
Tel: 011 41017353