BEIJING — Confronted with a shrinking population and a rapidly greying society, China has announced an ambitious five-year plan to build what it calls a “childbirth-friendly society”, pledging sweeping reforms to healthcare, social security and family support in a bid to reverse record-low birth rates.
The policy, unveiled on March 5, 2026 during the country’s annual legislative meetings, comes as official data confirmed China’s population declined for the fourth consecutive year in 2025. At the same time, authorities project that by 2035, 400 million people — nearly one in three citizens — will be over the age of 60, a demographic shift with profound economic consequences.
The government says it will increase spending, refine pension systems and eliminate out-of-pocket medical costs for childbirth, including in-vitro fertilization, beginning this year. The move represents one of Beijing’s most comprehensive attempts yet to address what policymakers increasingly view as a structural crisis.
A Nation Growing Older, Faster
China’s demographic slowdown has accelerated since 2022, when the population began shrinking after decades of growth. Birth rates have continued to fall each year despite the scrapping of the one-child policy and the introduction of two- and three-child allowances.
By 2035, China’s over-60 population is expected to reach 400 million — roughly equivalent to the combined populations of the United States and Italy. This looming “silver wave” threatens to strain public finances, shrink the labor force and dampen long-term economic growth.
In response, authorities said they would improve population services and respond proactively to aging by “promoting high-quality, full employment, improving the income distribution system, and refining the social security system.”
Full Medical Coverage and Financial Incentives
Central to the new policy is a pledge to remove key financial barriers to childbearing.
Beginning in 2026, the government will cover pregnancy-related medical expenses under the national insurance system, including fertility treatments such as IVF, eliminating out-of-pocket costs for families. Authorities will also introduce nationwide childcare subsidies and strengthen housing support for households with children.
The government plans to allocate an estimated 180 billion yuan — approximately ₱1.44 trillion — this year alone to boost birth rates. That funding will cover medical reimbursements and child allowances.
In its official report, the government said China would foster “positive attitudes toward marriage and childbearing” and address employment, education, healthcare and income concerns that discourage young couples from starting families.
Education and Housing at the Core
Recognizing that the cost of raising children extends beyond hospital bills, Beijing also pledged to expand access to education. Government spending on education will be maintained at more than 4 percent of GDP, with additional free preschool placements and expanded senior secondary school capacity.
Housing policies — a persistent source of economic anxiety for young Chinese families — will also be adjusted to provide additional support to households with children, though detailed mechanisms have yet to be published.
The reforms collectively aim to ease what many families describe as a triple burden: high childcare costs, competitive education pressures and demanding work schedules.
Refining a Strained Social Security System
China’s demographic pivot is not limited to boosting births. Officials also announced steps to strengthen the country’s social security and pension systems as the working-age population shrinks.
Authorities have already moved to gradually raise the retirement age — from 60 to 63 for men, and from 55 to 58 for women — in an effort to keep more people in the workforce and shore up pension finances.
At the same time, China aims to expand elderly care services, particularly in rural areas, as the number of retirees accelerates. Policymakers have framed the aging population not only as a fiscal challenge but also as an economic opportunity, promoting the development of a “silver economy” to serve seniors.
Economic Stakes and Regional Implications
The success or failure of the initiative will carry consequences beyond China’s borders. As the world’s second-largest economy navigates demographic headwinds, shifts in its labor force and consumption patterns could ripple across Asia.
For countries like the Philippines, where fertility rates remain comparatively higher but are projected to gradually decline, China’s strategy offers a stark lesson in long-term planning. An aging China could also increase demand for foreign workers in healthcare and elderly services — sectors where Filipino workers have traditionally played a significant role.
Still, demographic behavior is notoriously resistant to policy engineering. Other countries that introduced cash incentives and childcare subsidies have seen limited success in reversing declining birth rates.
A Long-Term Test
China’s latest measures mark a decisive shift from decades of population control to an era of active population support. The government has signaled that birth rates and aging are no longer secondary social issues but central economic priorities.
Whether financial incentives, expanded healthcare, and social security refinements can persuade young Chinese couples to have more children remains uncertain. But with population decline now entrenched and the over-60 demographic expanding rapidly, Beijing has made clear it views inaction as the greater risk.
In the coming five years, China will attempt what few major economies have managed: to bend the arc of demographic change before it reshapes the nation’s future.
