China introduces subsidy to spur population growth

BEIJING: China announced that it will start handing out childcare subsidies across the nation, in its latest push to boost birthrates after a worrying drop in recent years.

The government will spend 3,600 yuan ($502) a year per child under age three, according to the official Xinhua News Agency. The assistance, effective retrospectively from Jan. 1 this year and available regardless of the first-, second- or third-child, is meant as an incentive for young couples wary of rising costs of child-rearing.

The policy is expected to benefit more than 20 million families each year, Xinuha reported. China has previously offered tax breaks and has been working to offer more affordable daycare services, it said.


The latest measure follows China's population shrinking for a third straight year in 2024. New births at 9.54 million last year was only half of the 18.8 million registered in 2016 when China lifted its one-child policy.

Diminishing birthrate is a worry for the world's second-largest economy, where the working-age population has been declining in a threat to labour supply and productivity. The country, which lost its title as the most-populous nation to India in 2023, may see its population drop further to 1.3 billion by 2050 and below 800 million by 2100, according to the UN's demographic modelling.

That outlook stems from the alarming drop in marriage rates.