New birthrate strategy, billionaires leaving China and an EV tariff challenge

China looks to increase birth rate through a “new marriage and childbearing culture”

What’s the background? The Chinese government’s latest plan to address the country’s decreasing birth rate includes increasing support for families alongside efforts to create non-commercial platforms for young people to meet. Following decades of strict population control under the one-child policy, which ended in 2015, China has struggled to encourage families to have more children. In 2022, China recorded its lowest birth rate ever, and the subsequent population decline prompted the State Council to outline new measures aimed at fostering a more supportive environment for childbirth and family life. These efforts are intended to build a "new marriage and childbearing culture," emphasising the importance of shared parenting responsibilities and addressing the economic and social barriers that deter families from having more children.

Fact 1: In 2022, China's birth rate fell to a record low, with India overtaking it as the world's most populous nation

Fact 2: The new policies aim to provide extensive support for families, including better maternity insurance, extended maternity leave, and financial subsidies for child-related expenses

Fact 3: The state council's initiative emphasises not only economic support but also a cultural shift towards valuing childbearing and marriage. Efforts to create non-commercial platforms for young people to meet and form relationships are part of a broader strategy to promote a family-oriented culture

Concerns about China's ageing population have raised alarms over a shrinking workforce. Once known for its overpopulation, China now faces a future where the labour market will look very different due to an ageing demographic and declining birth rates. These changes create challenges for maintaining population stability, impacting both the economy and social structures. The government recognises this issue, prompting recent measures to build a more “supportive environment for childbirth and family life,” with the goal of fostering economic growth and sustainable consumer markets. However, much depends on how these policies are implemented and whether they resonate with the public—a critical factor to watch closely. This scenario creates potential for increased demand for healthcare, education, and consumer goods aimed at families. Yiyi Jing Government Affairs and Advocacy Manager, British Chamber of Commerce in China (BritCham China)

China loses third of billionaires as economy falters

What’s the background? Zhang Yiming, the 41-year-old founder of TikTok and owner of ByteDance, has topped China’s richest people ranking ($49.3 billion) despite his company facing scrutiny from the US government. According to the Hurun Research Institute’s annual Hurun China Rich List, the total wealth of entrepreneurs on the list this year was $3 trillion, marking a 10% decline from the previous year. The decrease in the number of super-rich reflects China’s economic slowdown, driven by government crackdowns, depressed equity markets, and other factors. This marks an unprecedented third consecutive year of decline for the list, though e-commerce giants have shown resilience, making up the majority of those ranked.

Fact 1: The number of US-dollar billionaires in China peaked at 1,185 in 2021, but it has now fallen to 753

Fact 2: ?For the past three years, Zhong Shanshan, the 70-year-old owner of Nongfu Spring, topped the list, but his business faced significant backlash after being accused on social media for being ‘pro-Japan.’ He is now second on the list

Fact 3: Members on the rich list also retain political influence – about 7 percent are members of China’s top political advisory body, the Chinese People’s Political Consultative Conference, or the National People’s Congress

China’s rich list has been constantly changing, and the overall decline in recent years reflects the sluggish Chinese economy. The list often mirrors economic trends and structures, highlighting technology and sustainability sectors as core areas driving growth in China. While industries like real estate and manufacturing dominated in the past, the current focus has shifted. Alongside e-commerce giants, figures like Robin Zeng, head of lithium battery maker CATL, have made it to the top 10 list, reflecting the strength of China’s emerging sectors. Etsuka Tomonaga Policy Associate British Chamber of Commerce in China (BritCham China)

Coffee break read: ?China’s critical mineral leverage

Why we like it: This piece focuses on China's leverage over critical minerals, revealing an increasingly strategic approach from Beijing towards tech and green energy advancements. China, with its dominance in processing minerals like gallium and germanium, is pivotal to the production of smartphones, semiconductors, and electric vehicle batteries. The piece underscores how China’s export restrictions, including recent limitations on antimony, align with trade tensions—highlighting its response to Western tech curbs. The minerals debate taps into broader discussions on economic security. For Europe, the priority remains balancing supply chain resilience with international partnerships. Rather than focusing solely on risks, the article hints at proactive moves by countries aiming to diversify sources and build homegrown processing capacity. While it’s clear the mineral landscape is evolving, the future still holds potential for cooperation to navigate these mutual dependencies.

Podcast of the Week: China’s Trade Challenges for the European Economy

Why we like it: This podcast discusses the implications of the EU’s decision to impose tariffs on Chinese electric vehicles, with Germany opposing the move. Experts Agathe Demarais and Janka Oertel explore potential trade tensions, including China’s retaliatory measures on European brandy, an area being watched by UK companies. They also examine how the EU might leverage market access restrictions and reflect on lessons from sanctions used in the Russia-Ukraine conflict. The episode raises questions about whether these tensions could escalate into a trade war and how Germany might navigate its stance.

...and finally...

China's iconic baijiu, led by Kweichow Moutai, is eyeing a comeback. While domestic demand has cooled, overseas sales are expanding, especially in South Korea, Europe, and North America. Hong Kong’s recent tax cuts on high-proof spirits should also drive sales. With its international reach growing and share buybacks underway, Moutai may finally shake off its recent “hangover” and find new momentum abroad.