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Mar. 10, 2015 - Updated 04:16 UTC



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To Have or to Hold?

Naoki Makita

Nov. 13, 2015

China has announced it is scrapping its decades-old one-child policy. Under the old law, couples paid a heavy fine if they had a second child. That restriction is being swept away. But the new freedom also has a cost.

A company in Beijing produces educational materials for toddlers. Through its online store, the firm sells study kits for learning things like English as well as traditional Chinese poetry.

It also markets imported baby products and develops social network apps for mothers. Company officials are hoping that the new family-planning policy will boost their business.

"A survey of our 10,000 customers shows more than 30 percent of mothers want to have a second child," said Wang Huainan, CEO of babytree. "There’s limitless potential in the education market, and we’ll be setting our sights even higher due to the new policy."

Wu Yi lives in Beijing with a three-year-old son. Her husband lives away from home because of his work, but he plans to come back soon. The 31-year-old mother wants to have a second child, who she believes will teach her son to be more mature and responsible.

"My son is a bit spoiled," Wu said. "If we have a girl, he will probably take care of her and learn to think more about other people."

Wu is vice president at a school for art and film studies. The couple's combined annual income is about 47,000 dollars. That is much higher than what the average Beijing household makes.

Wu thinks education is the most important part of raising a child. Her son goes to a private kindergarten that teaches English to kids. The monthly tuition is 700 dollars, almost triple the cost at public kindergartens.

She is also planning to buy a condominium in a district with an elementary school that has high academic standards.

"That will be a heavy financial burden, but we have to overcome it for our two children," Wu said.

But for some couples, the idea of having a second child remains just that ... an idea ... because of financial difficulties.

Wang Ying is a stay-at-home mom with a one-year-old daughter. She quit her job as a manager at an advertising agency after she became pregnant. Her family’s annual income fell 50 percent to about 16,000 dollars.

The money the couple used to spend traveling and pursuing hobbies now goes toward their daughter’s future education. They feel one child is more than enough.

"If we had two children, we'd have to spend less on education for each of them," said her husband Zhou Yibin. "I’d rather have just one child and give her a better education."

Wang and her husband are the only children in their family. They will eventually have to care for both pairs of parents when they get old.

"We'd need a lot of money if we want to have another child; it would put more pressure on us," Wang said. "There's no way we can support all our parents plus two children."

Naoki Makita joined Aki Shibuya and Sho Beppu live from Beijing to speak about the situation.

Shibuya: Naoki, the one-child policy was in place for decades. What were the advantages and disadvantages?

Makita: The Chinese government imposed this one-child policy around 1980. It was seen as an unprecedented experiment by what was then a poor country. The goal was to put the breaks on runaway population growth. In this respect, the policy was effective. Officials have been saying 400 million births were prevented. But critics outside the country decried the policy as a violation of human rights. And from a practical stance, the imbalance it caused between old and young people made it unsustainable. With its relatively weak social welfare system, such as the pension program, the country could no longer afford to continue down that path. The government predicts that China's population will peak in the late 2020s and then start declining.

Beppu: I understand why the Chinese government decided to end that policy. As you point out there are some families who are not entirely happy with the idea to have a second child. With this policy shift, what kind of impact can that have on family planning?

Makita: The Chinese government has been relaxing the one-child policy in stages. Last year, for instance, it approved couples to have a second child if one of the parents is an only child. But not many families applied -- only 16 percent of eligible couples as a matter of fact. A heavy financial burden is considered to be a major reason. Advanced nations with falling birth rates have various measures in place to encourage families to have more children. They make it easier for couples to work and raise children at the same time. They provide child support allowances and leave for both parents. Gui Shixun, a professor at East China Normal University says China still has to make such improvements.

"The government must increase its support for families with two children. For instance, it must lead the attempt to improve nursery schools, family support and other things as part of its public services so they won't impose a heavy financial burden on families. These costs could stay high if we just let the market determine them."

Beppu: If China's birth rate doesn't pick up despite the policy shift, what kind of impact could it have to the economy?

Makita: In China, the number of people aged 60 or above has reached 200 million. Meanwhile, the working-age population has been shrinking for three years. The government recently predicted that the new policy will help increase the population by 30 million by 2050. But some people are skeptical. They aren't sure if this new policy will be all that effective. As the country's economy slows down, the government is hoping that personal spending will help accelerate growth. But if the working-age population doesn't increase as expected, it will be very difficult to revitalize the economy. We can say, perhaps, that China's economic future depends on whether the government can balance the country's lopsided demographic structure.