In my previous column, I explained that, contrary to the impression created by sloppy analysis and lazy use of terminology, the People’s Republic of China (PRC), while being one of the most powerful countries in the world, was not yet a superpower. To reiterate, superpower is a politico-military concept, not an economic one. In all the years that it was the second-largest economy in the world – and one of the most sophisticated economies as well – no one called Japan a superpower.
This, of course, begs the question: Will China become a superpower? The first thing to note is that China is an increasingly powerful country and it can safely be stated that this process will continue. However, it cannot be taken for granted that this process will continue until the country is in the same league as the US. That this uncertainty exists is due above all to one man: the first leader of the PRC, Mao Zedong.
Mao’s strictly enforced “one child policy”, to counter population growth (which was only lifted at the start of 2016), has had a severe demographic impact on China. The consequence is that the Chinese population is expected (by the United Nations Population Division) to peak in 2028 or 2029 (just a decade from now) and then start declining. But, when it comes to a key subset of the total population, namely the working age population (people aged from 15 to 64), that is believed to have peaked just before 2015 and is already declining! And that decline will be especially marked among the younger age cohorts of the working population.
Over the period 2015–2040, the proportion of 15- to 29-year-olds in the working population is forecast to fall from just under 33% to just over 25%, while the equivalent figures for 30- to 49-year-olds are 43% and 37%. By 2040 (just 21 years from now), 22% of the Chinese population will be aged 65 or over, making the country a “super-aged society”. Chinese society will be more aged than the US society will be in 2040.
In 2017, the country’s fertility rate (that is, births per woman) was 1.6, a slight increase over the rate for the year 2000. The fertility rate for the US (and the UK) for that same year was 1.8. Although the one-child policy has ended, the indications are that most families, for socioeconomic reasons, are continuing to have only one child. By contrast, the average American (and British) family has 1.9 children.
No country has ever reached the top of the politico-military hierarchy with an ageing population. Traditionally, in China, care for the elderly has been a family responsibility. But with a declining population, this becomes impossible. So more and more of China’s resources will have to be poured into looking after its elderly. China does not have Japan’s social technological capabilities and high per capita income, which will help its traditional Asian rival handle its ageing population. On top of all this, China’s declining workforce is likely to hurt its economic growth. Thus, while China might reach superpower status, these demographic trends strongly suggest it won’t.