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China's demographic dividend disappearing: expert


07:18, January 29, 2013

BEIJING, Jan. 28 (Xinhua) -- China's demographic dividend has been disappearing since 2012, which will have significant impact on economic growth, the People's Daily quoted an expert as saying in a Monday report.

"We should be psychologically and politically prepared for the situation," said Professor Cai Fang, a demographer and director of the Institute of Population and Labor Economics of the Chinese Academy of Social Sciences, in an interview with the People's Daily, the flagship newspaper of the Communist Party of China (CPC).

His remarks came following the first decrease in the size of China's labor force since the country's reform and opening-up drive began in the late 1970s.

Data released by the National Bureau of Statistics (NBS) on Jan. 18 showed that the number of laborers between the ages of 15 and 59 decreased by 3.45 million year on year in 2012, marking the first "absolute decrease" in China's labor force.

Ma Jiantang, director of the NBS, said at a recent press conference that the situation calls for much attention.

The demographic dividend is a window of opportunity in the development of a society or a nation that opens up as fertility rates decline, with faster rates of economic growth and human development becoming possible when combined with effective policies and markets.

A report from the China Development Research Foundation also stated that the country's labor force will decrease by about 29 million over the current decade.

Cai said the disappearing demographic dividend will bring great changes in terms of China's economic growth.

"Potential growth rates are decided by the input of the labor force, capital and improved production rates. The disappearing demographic dividend will significantly affect these three factors," Cai said.

Cai said China's future economic growth will decelerate due to the disappearance of the demographic dividend.

"Facing the disappearance, we can increase the rate of labor participation and the production rate," he said.

As to whether the country should adjust its controversial family planning policy or one-child policy to alleviate the impact, Cai said different families have different expectations and the government should begin to properly adjust population policies from a people-oriented perspective.

"As far as I'm concerned, any adjustment should include being open to a two-child policy," Cai said.


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