For many demographers, China’s new population policy is “too little, too late”

Beijing (AsiaNews) – China’s decision to abandon its one-child policy is ““too little, too late,” said Shanghai-based Andy Xie, a former Morgan Stanley chief Asia economist, about the Communist Party’s plan to allow all couples to have two children.

“The population will begin to decline in 10 years,” he explained. “Why keep population planning?” He is not alone in this view. Most economists and demographers with a focus on China agree.

For Steve Tsang, a senior fellow at the China Policy Institute at the University of Nottingham in England, “It is an important step in the right direction, but its impact may not be as great as it first appears”. In fact, “Most urban Chinese families do not want to have two children because of the huge costs involved in raising children.”

The announcement spurred heated debate on Weibo, a Chinese-language social-media platform. One user calculated it would cost 1.35 million yuan (US$ 212,000) to raise a child until he or she gets married. With a monthly salary of 5,000 yuan, it will take 45 years to earn enough money for two kids. “I just cannot afford it,” he or she wrote.

Bloomberg Intelligence economists Tom Orlik and Fielding Chen cited three other reasons why the relaxation will have limited impact on the birth rate and the economy: the lag time before any new children enter the workforce, social pressures that push young people to work harder and start families later, and multiple exceptions to the existing rule.

A previous relaxation, allowed families to have a second baby if one parent was a single child, fell well short of the goal of boosting births by 2 million a year.

“The baby boom will probably not show up,” said Zhu Qibing, a Beijing-based analyst at China Minzu Securities Co. “We need to be careful not to overestimate the short-term boost to GDP.”

“China’s working-age population has already begun to shrink,” noted Nicholas Eberstadt, a demographer with the American Enterprise Institute in Washington.

“[L]ong-term population decline is in the cards in the not-too-distant future”. Thus, “This latest bit of tinkering with population control will almost certainly fail to put China on a path to population stability.”