By David Stanway

SHANGHAI (Reuters). – China’s per capita GDP is almost seven times higher than that of Japan. The new findings highlight the problems facing Chinese policymakers trying to reduce rapidly decreasing birthrates.

Experts are concerned that China’s population is aging will place enormous pressure on the country’s health system and social security system. A shrinking workforce may also limit China’s growth potential in the future.

New policies permit families to have up to three children. However, China’s birthrate dropped to 7.52 per 1000 people in 2021. This is the lowest level since 1949, when the National Bureau of Statistics started recording data.

Beijing has taken steps to crack down on private tutoring. Some regions also offer cash grants for couples looking to have a third or fourth child.

In a Tuesday report, YuWa Population Research Institute, Beijing, stated that China’s average cost to raise a child up to 18 years old in 2019 was 485,000 Yuan (or $76,629). This figure is 6.9 times China’s per-capita GDP.

China is second among 13 countries in this study. South Korea has the highest birth rate, and China comes in at number two. Based on 2015 data, the U.S. figures were 4.11 times per capita GDP. Japan’s figures, however, was 4.26.

China’s big cities are more expensive for child rearing, at over 1 million Yuan in Shanghai and 9699,000 Yuan in Beijing. These cities have birth rates that are significantly lower than the national median.

YuWa stated that China’s declining birthrate would have a profound impact on its economic growth, innovation potential and welfare burden.

China should spend at most 5% of its annual gross domestic product to provide incentives to couples for having more children. These include education subsidies and preferential mortgage rates as well tax breaks. Equal paternity, maternity leave and construction of additional childcare centres.

($1 = 6.3292 yuan)