Fertility challenge: China’s demographic imbalances
According to the latest Chinese census, which was taken in 2010, Chinese fertility remains far below the replacement rate at 1.2. Demographers claim a normative replacement rate of 2.1 is required for population replenishment. China’s demographic problem is unique in that its falling replenishment rate was accelerated by China’s one-child policy. However, the entire nation-state embodies varying trends, making it exceedingly difficult for Beijing’s political class to find a uniform solution.
Demographer Wang Feng at the University of California (Irvine) has studied Chinese demography for decades; the Balkanization of China’s demography threatens serious consequences for both economic growth and regional stability. The region with the absolute lowest rate remains Beijing with 0.71 in 2010. The highest rate was Guangxi, a southern province on the Vietnam border registering 1.79.
The reason for disparate regional vagaries is simple: China’s application of its one-child policy was never uniform. In Xinjiang, China’s western corridor, home to Tibetans and Uighurs, people were never subject to China’s one-child policy. Even though minorities account for nearly 8% of China’s total national population, those residing in urban residences were permitted two children those in rural areas could have four or more. Those that claimed Han ethnicity were permitted two children.
The composition of Chinese demography fits into four categories. Areas of low urban fertility contain China’s three mega-cities of Beijing, Shanghai and Tianjin. This section also encompasses the northeastern provinces of Manchuria where the one-child policy was applied the most strictly. The total population in China’s lowest category remains 170 million.
Geographic areas that shape China’s middle category are littoral provinces, including the Sichuan basin in western China. Historically, these areas have been governed by those of Han ethnicity and have experienced fast economic growth coinciding with mass urbanization. This category has over 600 million people.
The third category encompasses mixed ethnic groups living just inside China’s littoral interior such as Henan, Anhui and Hunan. With few urban dwellers, these composite groups include the Ningxia in the northwest, a third of whom are Muslim. The total population is steady at 460 million.
The fourth category encompasses China’s largest composite mix of migrating ethnicities. They tend to be rural, coinciding with other categories of fast-trending fertility rates. Regions such as Guangxi have a population base of 120 million.
Taken as a whole, the Chinese nation-state has suffered badly as a result of its one-child policy. Differences in fertility and its concomitant socio-political problems remain entrenched for China.
China is witnessing the aging of competing provinces at different speeds and trend rates
Making matters more difficult for Beijing’s political class is social volatility, the impact from migration into the Chinese littoral; this means that fertility alone isn’t the only social, economic or political force driving strong vagaries into provincial demography. Witnessing the mass migration of different regions into urban littoral areas meant exacerbating intrinsic ethnic-based regional differences that cannot find any neat policy solution. This means that China is witnessing the aging of competing provinces at different speeds and trend rates.
Why is this significant?
The provision of pensions is a local problem. Even though China fixed the basic rate of state pensions regardless of ethnicity, the contribution rates vary, making local administrators responsible for a heavy burden of sourcing replacement laborers while contributing to higher fixed pension costs.
The demographic profile of Beijing, Shanghai and Tianjin (which has China’s lowest fertility rate) looks healthier because of its ability to attract younger workers into higher paying jobs. Because of domestic migration into these three cities, their overall population is growing annually at 3%.
However, Chinese provinces with high fertility and outward migration suffer for opposite reasons. Without having fresh migrating workers to replenish both locally serviced pensions and downward trending fertility means that hospitals, schools and expensive redundant social services suffer collapse.
Convergence of all negative trends
The region that embodies the convergence of all negative trends is the northeast. Because it implemented the one-child policy most ruthlessly while housing China’s previously successful state-owed coal and steel mills, it suffered a massive net outflow of over 2 million workers. Today, China’s northeast resembles a true rustbelt.
The year 2016 saw China’s demographic crisis explained in the China Business News. It revealed that for every locally paid pensioner, their must be three working people. This means that unless Beijing’s political class reviews policy incentives that shape low fertility, China will be permanently hampered by aging populations, insolvent pension systems, collapsing social services and volatile dependency ratios.
Beijing is terrified of regional challenges. It has long sought to narrow all economic differences between the provinces while seeking to openly erase local political distinctions. This is what underwrites President Xi Jinping’s drive to consolidate his own position within the ruling hierarchy.
China’s hidden fear of internal breakup is revealed in its incessant imposition of stronger central control over peripheries. With trends driving Chinese fertility towards implosion, Xi will need all the international friends he can find.