Chinese city offers cash for births as alarm grows over China’s ageing population

China’s rapidly ageing population is leaving authorities struggling to boost the nation’s birth rate, searching for ways to reverse the decline.

Now for the first time, one city is offering couples cash to have babies in what may well become a trend across the nation.

The government of Panzhihua city in the far southwestern province of Sichuan announced on Wednesday it will give local families 500 yuan (around US$75) per baby every month if they have a second or third child, until the babies reach three years old, state-run Xinhua News Agency reported.

The city of 1.2 million, known for its steel industry, will also offer free childbirth services to mothers with local household registrations, and set up more nursery schools near workplaces.

Panzhihua city government’s childcare subsidies form part of a broad set of measures announced to attract badly needed talent into the workforce.

The city will also give cash bonuses to qualified top researchers, teachers, medical professionals and entrepreneurs who decide to settle there.

China’s new births plunged to their lowest in almost six decades last year amid the uncertainties of the Covid-19 pandemic.

This points to the prospect that the country’s population, currently at 1.41 billion, may begin to shrink before 2025, according to Bloomberg Economics’ estimates.

As China relaxes its child-bearing policies amid the declining birth rate, the country plans to promote tax deductions for child expenses for those under three, Xinhua reported last week.

Also, at the end of May, Beijing said it would allow married couples to have up to three children.

The previous limit was two children after Beijing ended its decades-long one-child policy in 2016 over concerns of an ageing population, but it didn’t lead to the necessary increase in births, due to the high costs of raising children in the country’s cities, Reuters reported.

Beijing earlier this month pledged to lower the cost of childbirth, parenting, and education by 2025.

The Chinese government is clearly alarmed. After decades of enforcing the one-child policy, the country is facing a rapidly ageing population, with fewer and fewer young workers available to keep the economy going.

Furthermore, the cultural preference for male children in China, combined with the one-child policy, has led to an enormous, and growing, gender imbalance.

Huge numbers of Chinese men can never hope to get married or have children, something that experts fear could increase social unrest in the country and lead to the kind of upheaval the ruling Communist Party is coming to dread.