China is introducing a subsidy for parents to care for young children in order to stimulate the birth rate, which has shown a steady decline in recent years. Under the new initiative, families will receive roughly $500 a year for each child under the age of three, informs Bloomberg with reference to the state agency Xinhua.
The financial assistance will be effective from January 1 this year, and more than 20 million Chinese families are expected to receive it each year. The official broadcaster of the People’s Republic of China notes that tax incentives for families with children have already been introduced in the country, and work is underway to expand access to quality childcare services.
The new support system was introduced against the backdrop of another population decline: in 2024, the number of Chinese citizens decreased for the third time in a row. Just 9.54 million babies were born last year — half the number in 2016, when the country abolished the one-child policy.
In 2023, China lost its status as the most populous country in the world — India took first place in terms of population. According to UN estimates, by 2050 China’s population may decrease to 1.3 billion people. These demographic trends are worrying in the world’s second-largest economy, where a shrinking working-age population poses a threat to labor resources and overall productivity.
At this year’s National People’s Congress, a number of lawmakers and political advisers called for more support measures, including increased access to childcare services, to create a “fertility-friendly society”.
