Index > Briefing
Tuesday, April 20, 2021
Population Issues Challenging China

There are a number of medium- and long-term challenges that China has to face. On the one hand, the biggest international challenge would be the geopolitical game that was initiated by the United States against China. On the other hand, at domestic level, an aging population and a declining birthrate would be the most daunting challenge that China has to face.

Statistics show that at the end of 2019, the proportion of China's population aged 60 and above has reached 18.1%. According to the classification standards of the United Nations, this will cause China to be classified as a mildly ageing society in 2000. As the proportion of the country's population aged 60 and over exceeds 20% or the proportion of the population aged 65 and over exceeds 14% which is estimated to happen by 2025, China will then be classified as a moderately ageing society. It is estimated that during the 14th Five-Year Plan period, the population of the elderly will exceed 300 million, causing China to enter a moderate ageing stage.

According to the estimation of the China Development Research Foundation in its China Development Report 2020, there are about 180 million elderly people aged 65 and above in China in 2020, accounting for roughly 13% of the total population. By 2025, this number will increase to 210 million, accounting for about 15% of the total population. In 2035 and 2050, the number of elderly people aged 65 and over in China will reach an estimated 310 million and 380 million respectively, accounting for 22.3% and 27.9% of the total population. This means that by 2050, China will have a population of nearly 500 million elderly people over the age of 60.

Ageing will have a profound impact on China's economic and social development. First of all, it has directly led to a decrease in the labor force. According to data from China's National Bureau of Statistics, the country's elderly dependency ratio has risen to 17.8% in 2019. The Institute of Population and Labor Economics at the Chinese Academy of Social Sciences predicts that China's elderly dependency ratio will continue to rise until 2060, and will exceed that of the number of children around 2028. Secondly, ageing will bring challenges to the pension fund system. If pension payments become unsustainable, poverty among the elderly in China may turn into a serious issue. Data from the China Household Finance Survey (CHFS) shows that the poverty rate of the elderly population in China was 14.5% in 2018 and this problem of poverty among the elderly population is more serious in rural areas. In 2018, the poverty rate of the rural elderly population rose to 19.5%.

Another facet of China's population problem is declining birthrate. According to demographic standards. A society with a population of only 15%-18% with ages between 0-14 has "severely declining birthrate", and if it is less than 15%, it would then be deemed to have an "extreme-declining birthrate". At present, the proportion of children in Japan is about 13%, which falls in the stage of "extreme-declining birthrate". According to China's sixth census, the total population with ages between 0-14 in 2010 in China was 220 million, accounting for 16.6% of the total population, which is already at a serious level in terms of declining birthrate. This is a reminder that China is a society with a declining birthrate issue which is even more severe than that of Japan. That said, China has not paid much attention to the severity of this issue, with some people even think that the declining birthrate is no more than a false proposition.

Since 2016, China has relaxed the one-child policy and allowed parents to have up to two children, with the aim of promoting the increase population and alleviating the pressures of declining birthrate. However, China's population has declined since 2016 even with the policy changes and the declining birthrate has only been worsening with each passing year. From 2016 to 2019, the number of newborns was 17.86 million, 17.23 million, 15.23 million, and 11 million respectively. According to the Guangdong Population Development Academy, the current trend shows that the annual population during China's 14th Five-Year Plan period may fall below 10 million. This means that the two-child policy has failed to achieve the expected results and it also indicates that further liberalization of the childbirth policy may prove to be ineffective.

ANBOUND's founder Chan Kung believes that the declining birthrate should be looked at from a social perspective. He proposes that the declining birthrate is a result of the "juvenilization" of the society which manifests itself in various aspects. Looking at declining birthrate from such a point of view, its impact is certainly not wholly negative, though it does indeed pose greater challenges to the original order of the Chinese society. Chan Kung believes that the declining birthrates will lead to a fragmentation of the traditional social order as well as rules, systems, ideas and traditions. Such loss of tradition and change in culture may also affect the country's future governance and political system.

For instance, China's current culture and art scene is glorifying young, delicately-featured males, or more colloquially touted as "little fresh meat" in the country. They can now be seen in war-themed movies, playing roles that do not usually conform to common perceptions associated with such movies. This reflects the profound impact that the declining birthrate has had on all social stratifications. In fact, the general "juvenilization" brought about by declining birthrate will influence the entire Chinese society as well as reduce the quality of culture and art of the country.

The popularity of the internet and online gaming in the Chinese society is also closely tied to its declining birthrate. In recent times, the internet as well as online gaming have become an essential part of life in the world of declining birthrates. In elevators, subways, and restaurants, countless young people can be seen completely immersed in mobile games, and "internet addiction" has long since become a social epidemic. WeChat's commercial success in China is mainly due to the fact that it is a mobile social game suitable for all ages. From the perspective of the information society, due to the impact of declining birthrates, the Chinese society will become the most controllable one in the world. Not only younger populations are addicted to online and mobile games, increasingly adults too are obsessed about them as well.

The declining birthrate will also seriously affect China's labor and talent supply. "Juvenilization" brought about by the declining birthrate has made it difficult to produce mature and professional workers. Employers have a limited pool of suitable employees to pick from, and many among them are often thought to be insubordinate and unable to withstand social pressure. In such a society, the juvenilization caused by declining birthrate might even severely affect other more mature groups.

China's population growth too, has also been affected. According to statistics, in 2018, there were as many as 240 million single adults in Mainland China, of which more than 77 million lived alone. It is estimated that by 2021, the number of adults living alone will be close to 100 million. The increase in the single population has raised concerns among demographers. Statistics show that from 2013 to 2020, the number of marriage registrations in Mainland China has dropped from a historical high of 13.47 million to 8.13 million. In contrast, the divorce rate has continued to rise. From 1987 to 2020, the number of divorce registrations in China rose from 580,000 to 3.73 million. Under the dual effects of falling marriage rates and rising divorce rates, the fertility rate has decreased year by year. We believe that the essence of this problem is a declining birthrate. Young people do not wish to have children simply because they cannot afford to. In the era of declining birthrate, the younger generation have much higher requirements in selecting their spouse than they did in the past, and this might be a more important reason for them to remain single than mere economic basis.

The declining birthrate issue could even have an impact on national governance and politics. In a normal national governance system, a cycle of politicians from the commencement of their career to their growth, holding of power, and governance is roughly positively correlated with the intergenerational development of the population. Simply put, similar to population development, the emergence and departure of politicians are similar to population development, which is carried out from generation to generation. However, if the problem of declining birthrate becomes more serious, it may delay the intergenerational growth and maturity of politicians, as the younger generations are having difficulty in coping with complex international and domestic situations. This in turn, will pose a challenge for the younger generation in terms of bearing the crucial responsibility of national governance. The emergence of this situation could very well break the political cycle of national governance.

Final analysis conclusion:

On the whole, China's population issue is extremely severe, and the country faces a challenging future. If China reaches the situation where its aging population is unable to achieve prosperity, this will drag down the country's economic growth, consume high amount of economic resources, and increase the pressure on the pension and social security system. The increasingly serious situation of declining birthrate will bring about changes in social order, culture, industries, and traditions, and even affect national governance and political cycles. Because of the huge population of China, the problem of aging and declining birthrate will have a profound impact on China's future development.

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