China Faces Economic Challenges From Falling Population
• China's aging population and declining fertility rate may lead to a period of low growth and deflation, similar to what happened in Japan.
• This economic weakness in China benefits countries like the US that import cheaper Chinese goods, helping to ease inflation.
• China's demographic challenges include a fertility rate of just 1.16 births per woman and a population that declined in 2022 for the first time since 1961.
• However, recent data shows signs that China's economy is recovering, with growth across industrial, construction and services sectors.
• Economists warn that without policy changes, China risks long-term stagnation, but measures to strengthen sectors like real estate could help avoid sustained low growth.