Demographic lessons to boost development

China faces significant challenges in sustaining its economic growth, prominent among which is the demographic issue, particularly a declining population and population aging. What's more, China's population is projected to decline further, leading to an increase in the average age of the population. This demographic shift will reduce the proportion of the working-age population, undermining China's potential GDP growth rate.

Japan has already experienced the severe consequences of an aging society, and thus can offer some valuable lessons. Japanese enterprises have addressed labor shortage by investing in automation and robotics, turning demographic challenges into innovation opportunities. The Japanese government, on its part, has implemented policies aimed at bridging the urban-rural gap.

One of China's most pressing economic challenges is the rapid decline in its working-age population. Since total fertility rates remain low despite the adjustments in the family planning policy, China faces a demographic headwind that threatens economic growth. A shrinking workforce leads to lower overall productivity, increasing dependency ratios, and mounting pressure on the social security and healthcare systems.