China launches subsidy program for families with children to boost birth rate
Illustrative photo: EPA

China has launched a nationwide subsidy program for families with children to boost the birth rate. About reported state news agency Xinhua.

The program provides for the payment of 3,600 yuan ($503) per year for each child under the age of three.

The subsidy will apply to children born from January 2025, but families with children born between 2022 and 2024 can also apply for assistance.

The policy is expected to benefit more than 20 million families annually. Each province will determine its own subsidy payment schedule.

This measure, which has long been discussed by scholars and policy makers, is a response to demographic crisisthat is looming over China, notes Financial Times.

The subsidies are also an attempt to stimulate weak consumer spending in the second largest economy in the world. Although China has recorded a real economic growth of 5.2% in the second quarter, the widespread fall in prices meant that nominal growth was much weaker at 3.9%.

According to experts, the amount of the subsidy is too small and is unlikely to have a significant impact on fertility or consumption in the short term. However, the program could become the basis for larger-scale support for households in the future.

China's population has been declining for three years in a row, despite the end of the ten-year one-child policy that was in effect until 2016.

In 2024, the number of births increased by about 520,000 to 9.5 million, which is barely half the peak figure of 17.9 million in 2017. At the same time, 10.9 million deaths were recorded in 2024.

In 2022, the population of China decreased for the first time since the early 1960swhen the country was experiencing a massive famine.