China Throws Money at Population Crisis

Two Chinese cities have introduced cash subsidies as both the central government and local authorities dial up efforts to raise the country’s declining birth rate.

Newsweek reached out to the Chinese Foreign Ministry with a request for comment.

Why It Matters

While China’s birth rate saw a slight uptick in 2024, marking the first increase in eight years, the overall population declined for a third consecutive year. The shift, largely attributed to the end of strict pandemic-era policies, has raised concerns that a shrinking workforce could weigh on the world’s second-largest economy.

Younger generations in China—such as those in South Korea, Japan, and Taiwan—are increasingly delaying or forgoing children. Many cite rising living costs, shifting attitudes toward family life, economic uncertainty, and workplace cultures unfavorable toward prospective mothers.

What To Know

Health authorities in the northern city of Hohhot, capital of China’s Inner Mongolia region, on Thursday unveiled new cash subsidies aimed at boosting births.

Parents with a first child born on March 1 or after will get a one-time subsidy of 10,000 Chinese yuan ($1,380). Those welcoming a second one will receive 50,000 yuan per year until the child reaches the age of 5.

Households in the city of about 3.5 million with a third-born are entitled to an annual 10,000-yuan subsidy for the child’s first 10 years.

The southeastern metropolis of Shenzhen is taking steps toward updating its own pro-natal incentive, including by expanding access to child care services. The city will “actively and steadily implement” these policies in line with national directives, officials told state media.

Local governments across the country considering pro-natal policies hope to replicate the success of Tianmen, a fifth-tier city in Hubei province.

According to earlier official reports, Tianmen saw births rise by 17 percent in 2024, driven by its subsidy program. However, experts note that China’s metropolitan areas—where the cost of living is higher—may struggle to achieve similar results.

Though China does not currently offer child subsidies at the national level, encouraging births was a focus of the rubber-stamp Congress’s annual Two Sessions meetings earlier this month.

What People Are Saying

Zhang Hongmin, head of the Hohhot Municipal Health Commission’s family and aging section, told Chinese Communist Party newspaper the People’s Daily: “Previously, birth subsidies mainly covered second- and third-child families, making it difficult for first-child families to benefit from preferential policies, which in turn limited people’s willingness to have a first child. After research and evaluation, we have now included first-child families [ …] This adjustment aims to better leverage subsidies to boost the birth rate.”

What Happens Next?

Among the measures introduced at this year’s parliamentary session was a modest increase in minimum benefits for rural residents and nonworking residents of urban areas.

The government also signaled an “appropriate” increase to the basic pension for retirees and the expansion of “public interest” elderly care services. These announcements follow the government’s move this year to raise the statutory retirement age for the first time in decades as aging Chinese leave the workforce in record numbers.