Editorials reflect concern demographics crisis risks hurting economic growth

A series of editorials in a key mouthpiece newspaper are seen to represent concerns from Beijing that the country’s demographics crisis could impact economic growth, with the latest highlighting the need to “improve confidence in population development” and focus on the cultivation of high-quality talent.

A third consecutive editorial by Zhong Yin, a pen name that literally means the voice of the central government, focusing on China’s population strategy appeared in the People’s Daily yesterday.

There are growing market concerns about a shift of demographic dividend to India – which became the world’s most populous country in April, according to the Department of Economic and Social Affairs within the United Nations – at a time China’s economy is slowing.

“There has been heated discussion on the negative growth of the Chinese population, the falling birth rate, and the fact that it’s been overtaken by India. I think the unusual explanations in People’s Daily are a response to concerns about the impact of all these things on China’s economic growth,” said Liu Hongyan, deputy director of the China Population and Development Research Centre under the National Health Commission.

“It’s the right time to bring up the issue of enhancing population quality, because unlike in the early stage of reform and opening-up, when we relied on labour-intensive manufacturing for growth, we’re now in a totally different situation where technology and talent are the key issues.”

The People’s Daily editorials elaborate on President Xi Jinping’s vision on how China should tackle its ongoing demographic shift, including a rapidly ageing society and a falling birth rate, which was revealed during a recent meeting with top officials.

China’s overall population fell to 1.4118 billion last year, with the decline of 850,000 from 2021 marking its first decline in six decades after the national birth rate fell to a record low of 6.77 births for every 1,000 people.

But China should take advantage of the education level, health, skills of its population and continue strengthening to create a “talent dividend”, the Communist Party mouthpiece added.

Calling for the “full development of individuals”, the latest piece yesterday noted that last year the gross enrolment rate in higher education stood at 59.6 per cent, while 95.5 per cent had completed China’s nine-year compulsory education system.

Its basic pension scheme had also covered 1.05 billion people, or around 75 per cent of the total population, and the annual disposable income per person had more than doubled from 16,500 yuan (HK$18,550) to 36,883 yuan in the past decade, it added.

Yuan Xin, a professor of demography at Nankai University’s School of Economics, said China was seeing a growing disadvantage in terms of population size and structure, and the vigorous migration in the past decades, which had optimised the distribution of human capital, “will finally become quiet”.

“The only one favourable factor now is the rising quality of the population, where new potential is lying,” he said.