Economy/Resources - 43. page

In 2014, China introduced the “two-child” policy, resulting in a peak of 17.86 million births in 2016, the highest number since 2000. However, the “two-child effect” has diminished significantly, with only 15.23 million births in 2018 and a continuous decrease in subsequent years. In 2022, the number of births fell below 10 million, which means that the birth rate in China has dropped by almost half in six years.

The government’s plan to build a public preschool education system with wide coverage, basic protection, and quality by 2020 has resulted in the construction of new public kindergartens throughout the country. However, due to the decline in births, the situation has changed. A kindergarten in Wuhan, Hubei province, which was previously exclusive to children of employees of large state enterprises, is now enrolling children from the general public.

According to a professor at China’s University of International Business and Economics, the decrease in the number of educational institutions, including kindergartens, primary, and secondary schools, has been going on for some time due to the declining birth rate. In rural areas, schools have merged due to the shrinking population. In an interview with Chinese media, a professor at Beijing Normal University predicted a decline of 30 million in the number of students in compulsory education by around 2035, compared to 140 million in 2020.

The low birth rate has impacted China’s education sector, making kindergarten enrollment difficult and resulting in the shrinkage of educational institutions.

Source: Sputnik News, March 6, 2023
https://sputniknews.cn/20230306/1048470268.html

Measured by the volume of goods shipped, China used to be the largest shipping country. It also had a large fleet of ships and sailors. However, its zero-COVID and lockdown policy has ruined this business completely.

On February 24, the Shanghai Shipping Exchange announced that the Shanghai export container price index was $946.68 per TEU (Twenty-foot Equivalent Unit), which has declined for 14 months, setting up the newest and latest low price since 2015. Online pictures showed that the Shanghai port has piled up a large number of empty, unwanted containers; so have the Shenzhen ports.

A veteran shipper said that China’s shipping is like a roller coaster ride. Right after the outbreak of COVID, the U.S. and Europe were trying to implement quarantines. The demand for China’s goods soared and the container price rose four or five times higher. However, since 2022, the U.S. and Europe returned to business as usual, but China has still been locking down, especially with the lockdown of Shanghai in April 2022. This dealt a fatal blowout to Chin’s shipping business.

Source: Radio Free Asia, February 27, 2023
https://www.rfa.org/cantonese/news/economy-02272023035140.html

The former Governor of the People’s Bank of China, Zhou Xiaochuan, has acknowledged that China’s current pension system is facing challenges due to the country’s large and aging population. Zhou made these comments at the “5th Global Wealth Management Forum” hosted by Caijing Magazine on the 25th. According to Zhou, the expansion of the pension coverage in China has created a shortage of funds, making it difficult for the national pension arrangement to provide adequate coverage. He suggested that, in the future, personal pensions will play a crucial role in supplementing the national pension arrangement.

Zhou stated that China’s personal pension system is good in terms of social discussion, but the incentives are weak. The existing personal income tax has some flaws, as a large proportion of individuals in China do not fall within the scope of paying a personal income tax. Furthermore, Chinese enterprises are not anxious to cooperate with the personal pension system due to the high cost burden. This affects their competitiveness. Although the social security funds paid by Chinese enterprises have been adjusted down by 4 percentage points, at 16 percent, the rate of payment is still high, compared to the world.

Regarding the extension of the retirement age, Zhou believes that while there is room to extend the retirement age, it cannot be extended as many years as desired. This involves the average health level and productivity of the elderly, and companies must also take into account the costs involved.

Source: Central News Agency (Taiwan), February 26, 2023
https://www.cna.com.tw/news/acn/202302260106.aspx

China’s Ministry of Housing and Urban-Rural Development announced on February 15 that China has nearly 600 million buildings in cities and villages combined. The ministry spent 3 years and mobilized 5 million people (among whom 2.6 million are from the ministry itself), to cover all cities and all natural villages in China to get this result. The ministry has issued a digital ID to each building.

There are multiple interpretations of the 600 million number. One is that China’s housing is over-supplied. The authorities said 90 percent of the housing is from villages and only 10 percent are in cities. Assuming that is right and only 60 million buildings are in cities, and further assuming each urban housing has 16 units (4 floors and each floor has 4 units), that means China has 540 + 60 * 16 = 1500 million units or 1.5 billion units. China’s entire population is only 1.4 billion (without deducting the COVID deaths).

Another interpretation is that this housing census is to prepare the authorities to impose a real estate tax, as the government is running out of money.

Source: Epoch Times, February 24, 2023
https://www.epochtimes.com/gb/23/2/24/n13936935.htm