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China's demographic challenges

Comments on Zhongwei Zhao "Tackling China’s demographic challenges", 21/01/2016

It is stated that: “Instead in the 1980s China’s Total Fertility Rates (TFRs) fluctuated between 2.2 and 2.9 children per woman. But by the early 1990s, the strong family planning program and profound socio-economic transformation led China’s fertility to fall below replacement levels for the first time. Since the mid-1990s, TFRs have generally remained below 1.6 children per woman.”

Those rates are far from the target of family planning policy, one couple one child, even taking into account children mortality rate. Are they correct?
In the last paragraph, it is remarked that: “Yet, whether this, and other development strategies, will be sufficient to cope with the great socio-demographic changes brought about by China’s rapid urbanisation, ageing population and persistently low fertility rate remains a debatable question.”
Surely, the persistent fertility rate will change after the change in the family planning policy to allow two children per couple, though it may take time to see real effects.

REply to comments by Rechard: I agree it will take long time, a generation’s perhaps, for the new born to become labour force. However, it is possible that people may have different incentives/motives in relation to supporting their old parents and raising children. That means people with another children may work harder or smarter if they can to raise the child. That, though tangentially, be positive to the economy, I would reckon.

How will the government provide more schools for them? That is part of the challenges China will face, though it is not insurmountable. China is transitioning to a more service dominated economy and the education sector will be part of that. Financially, China, like any or at least most countries, must prioritise government spending and education should be a priority due to its many positive effects and spill overs, not to mention its role as part of people’s basic “rights”.

How to tackle people living longer and population aging? In theory, it should not be too hard to do actually. When people live longer, their economic productive life will be longer accordingly. So government can introduce policies/incentives to encourage people who can still work to work longer.

One may say some people may not be able to continue their labour types of work. That may be true, but with adequate retrain, they Further, if old people have adequate superannuation, like the policy in Australia, most of them can live off their own superannuation, though it may take time, indeed very long time.

Having said that, what I mentioned is easy said than done. General policy prescriptions is not hard, but get them in place and implement them in the right way are much harder.

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