China's birthrate conundrum#China Newsweek#-Sino-US

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China's birthrate conundrum

Should couples who do not have more than one child pay into a fund that will reward those who have more children? The question became a hot topic after a local newspaper in Jiangsu province put forward the idea of setting up a fund to encourage childbirth, but the public resisted it because it reminded people of a fine that was used to curb childbirth in the past.

No matter what, it reflects a shift from birth control to birth encouragement. But is it so easy to get the low-birth rate trend reversed?

In the 30th issue of 2018, the China Newsweek magazine ran a cover story on the country’s current population development and the potential of the encouragement measures to boost the country’s birthrate.

Below is an excerpt of the article.

Northeast China’s Liaoning province has recently issued a document to offer preferential policies to encourage couples to have a second child, in the areas of taxation, education, social insurance and housing.

Liaoning became the first province to issue a document on encouraging second child children in China. The document says it will explore more measures to reward families having a second child, extending the maternity leave and paternity leave.

The province has a much lower total fertility rate than most of the country’s provinces, regions and municipalities, except Beijing and Shanghai, according to the national population census in 2010.

Liaoning had a total fertility rate at 0.74 against the national level of 1.18 in 2010, although the national level is also far behind the replacement standard of 2.1.

In 1995, Liaoning entered an aging society that shows the population aged above 65 accounting for 7 percent of its total population, and according to a forecast, this aged group will account for 30 percent by 2039.

Many other places have also launched measures to encourage childbirth, such as North China’s port city Tianjin and Shihezi in Northwest China’s Xinjiang Uygur Autonomous Region.

Since China implemented the national policy to allow couples to have the second child in 2016, the number of newborn population did not meet the expectation of an explosive growth.

If the decline in birthrate continues, more places will join in to take measures to encourage childbirth, said some experts.

They believe that it was at critical for the country to adjust the population policy, and if not, the population decline would become an important factor to hinder the economic development.

Fertility decline

China started to allow all couples to have two children since January 1, 2016. There were 17.86 million new births that year, about 1.31 million more than 2015, but the trend did not continue in 2017 that saw 17.23 million new births.

Among the new births in 2017, more than half were second children and more than 40 percent were first children. Compared to 2016, the number of second children increased by 1.62 million and first children declined by 2.49 million.

The decline in the number of first children showed that China’s new generation born in 1980s and 90s are less willing to have children and the number of women has also declined, said Su Jian, a professor from Peking University.

The increase in the number of second children was because women born in 1970s and early 80s seized the opportunity to have a second child urgently, but it might only last for about three years, Su said. The number of second children will drop dramatically by 2019.

The current increase in new births will not continue, and the country’s population will decline rapidly, Su said.

Other experts supported Su’s view. They also think that the increase in the number of new births in 2016 will not be repeated, because couples who wanted to have a second child made use of the policy immediately, but the trend will not continue, and the number of second children will decline dramatically.

A statistics report from Shaanxi province showed 80 percent of the women giving birth to a second child in 2017 were between 25 and 34 years old. The number of second children will decline when the number of women entering this age group will decline in the future.

In Central China’s Henan province, the statistics showed that the number of second children also exceeded the number of first children in 2017. The birthrate will drop gradually, and the aging process will speed up.

Wang Guangzhou, a researcher from the Institute of Population and Labor Economics under the Chinese Academy of Social Sciences who took part in the research on the latest national population policy, said that the increase in the number of second children was along the expected lines, but the total number of new births was lower than expected.

Wang said that the major reason is the rapid drop in the birth of first children. “The increase in the number of second children and the drop in first children caused the total fertility rate to remain the same.”

The real fertility rate that is far behind the expected rate just shows the difference in the thinking of the policymakers and the childbearing group, said Lu Jiehua, a professor from Peking University.

“The reform and opening up brought economic development in four decades and also brought changes in people’s will for childbearing. Some young people think having more children is not a good thing, and having only one child or not getting married and gay marriage is acceptable to them,” said Lu.

The socio-economic development also had an impact on the desire to have children. Lu said that the cost of fostering a child increased a lot and the property prices were too high in large cities. Diverse life choices and improved social security also affect young people’s preferences, he said.

Wang Guangzhou said that the decline in the fertility rate reflects the trend of social development. The rapid decline in the fertility rate has caused rapid aging of the society, and in a long run, it will cause intractable problems in the demographic structure.

Zhang Chewei, vice-president of the China Population Association, said that the latest relaxation to allow all couples to have two children is still not enough, and it would be hard to resume the birth rate to a replacement standard.

Preferential policies

Liaoning issued the encouragement policy on July 5, including measures to combine maternity insurance and basic medical insurance and encourage employers to arrange flexible work agenda for pregnant and nursing women.

Wang Guangzhou said that Liaoning’s current situation was just a miniature of the whole country, and to change the population situation, many other places will follow it in the future.

According to experiences in other countries, it was easy to lower the birth rate, but harder to raise the rate. It has become a focal topic among scholars and the public on how to encourage childbirth.

The measures taken currently across the country are aimed at extending the maternity leave and offering more birth allowance. Some experts and public believe these were only small benefits which could not radically solve the problem.

While being allowed to have a second child, some couples are worried about how to take care of the child. Some predictions showed that the problem curbed birthrate of second children about 8 percent of.

Wang Peian, former deputy head of the National Health and Family Planning Commission, said that authorities are working on a plan to support the care of babies below 3 years old, and the plan will be announced this year.

Some scholars said that except for building child-care centers and providing various fertility benefits, there is need for policies to provide direct financial subsidies and tax cuts.

Liang Jianzhang, CEO of Ctrip and a respected demographer, said that common people would not want to have more children if there were no financial means to cut the birth cost.

Liang said that some countries allocated 1 to 5 percent of GDP to support childbearing, and the successful examples including countries in northern Europe which allocate 5 percent.

Yuan Xin, a professor from Nankai University, said that the income tax should be cut for the family having two children. For example, if the husband earned 20,000 yuan but wife did not work, the family should not pay tax.

Some experts also called for allowing three children. Zhu Lieyu, a National People Congress delegate, proposed the idea during the Two Sessions this year. He said this is the only way to help stabilize the population.

Some scholars shared the view that the new demographic situation requires further relaxation in the family planning policy, until the control on childbirth is fully lifted.

Zhou Tianyong, professor at the Party School of the Communist Party of China Central Committee, said in an article in June that there is an urgent need to relax the fertility control in general.

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