How the three major demographic trends affect China’s development

The results of the seventh national census announced on the 11th showed that China’s population will reach 1.41 billion in 2020, accounting for about 18% of the world’s total population, and it will still be the world’s most populous country. However, the acceleration of China’s population aging process, the increase of urbanization rate, and the negative growth of the population in Northeast China in the past 10 years have also attracted widespread attention. How will these affect China’s future economic development?

“Silver Economy” has a lot of room for development

According to the results of the seventh national census, the current population of the elderly in China is huge, with 260 million people aged 60 and over, of which 190 million people are 65 and over. Compared with 2010, the working-age population of 16 to 59 has decreased by more than 40 million. Ning Jizhe, director of the National Bureau of Statistics, said that population aging, as a basic national condition for a long period of time in the future, is both a challenge and an opportunity. The aging of the population promotes the development of the “silver economy” and expands the consumption of products and services for the elderly, which is conducive to promoting technological progress.

Li Xunlei, chief economist of Zhongtai Securities, has long studied China’s population. He told that the aging process of a country is usually accompanied by a slowdown in economic growth. Japan, Germany and South Korea are without exception. But this does not hinder the successful transformation of the economies of these countries. Because of the reduction in labor force, these countries will be forced to pay more attention to productivity improvement and explore more development space for high-end manufacturing and service industries.

Li Xunlei believes that the most typical is the health care industry for the elderly, and there will be a lot of room for development in the future. The increase in the aging population will also lead to a reduction in a country’s savings rate, and more funds will flow into consumption, which will promote China’s transformation from an investment-driven economy to a consumption-driven economy, and make economic development healthier.

Professor Marukawa Tomohiro of the Institute of Social Sciences at the University of Tokyo, Japan, countries with more developed economies are more likely to encounter the problem of declining birthrates and aging populations. China and Japan can carry out some cooperation in related fields. At present, some Japanese companies have opened apartments for the elderly in China.

Northeast revitalization should be “dislocation development”

The Northeast region has become a topic of concern in the results of this census. According to data, the total population of the three northeastern provinces in 2020 is 98.51 million, close to 100 million. The scale is still large, but compared with 10 years ago, the population has shown a negative growth, reducing 11.01 million. At the same time, the GDP of the three northeastern provinces as a proportion of the country has been declining year by year. In the first quarter of this year, the GDP growth rates of Liaoning, Heilongjiang, and Jilin were 12.9%, 12.4%, and 14.9%, respectively, which were all lower than the national level. Ning Jizhe said that although the population of the Northeast region is declining, the region has a rich talent pool, and its economic development is still resilient and has great potential.

Li Xunlei believes that it is normal for the Northeast economy, which is dominated by heavy industry, to gradually decline in importance in the national economic transformation. “In the past, the eastern United States was very economically developed, but it has now been surpassed by the West Coast. Detroit in the Great Lakes region was once a glorious automobile city, and now it has become a’rust belt.” He said that the economic growth rate of the Northeast has been relatively low in recent years, just As far as the eastern developed provinces are concerned, it does not prove that the Northeast economy is not working. “The revitalization of the Northeast economy does not need to imitate the developed provinces in the east, and use the Internet or the semiconductor industry.” Li Xunlei believes that the Northeast should develop in a dislocation, based on the advantages of the region, such as strengthening large-scale planting and equipment manufacturing.

Increased urbanization rate is good for agriculture

According to the results of the census, the proportion of my country’s urban population increased by 14.21 percentage points to 63.89% in 10 years, and more than 100 million people moved from rural to urban areas. At present, China’s urbanization rate is at the upper-middle level in the world, which is roughly equivalent to China’s per capita GDP at the upper-middle level in the world.

Li Xunlei believes that at the current rate of urbanization, China’s urbanization rate is expected to reach 70% around 2028. The decrease in rural population is good for the development of modern agriculture. Advanced science and technology and the continuous penetration of the Internet from towns to villages, especially in combination with agriculture, will greatly boost rural economic development.

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