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Time to invest in Chinese baby food companies?

Friday, August 10, 2018 5:50

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Over the last few years, we’ve heard horrible stories about China and the so-called “one-child policy”. It was designed to control population but it has created a ton of unintended consequences. One of them is having too many young men and not enough young women.

This is from a CNN report:

The one child policy ran until 2015 when it was partially relaxed to allow some couples to have two children, but families have been slow to embrace official approval to expand.

An op-ed in a state-run newspaper titled “Giving birth is a family matter and a national issue too” is the latest to encourage couples to have more children, and call for official action to enable young people to start families.

The full-page column was published in the overseas edition of the People’s Daily, mouthpiece of the Chinese Communist Party. It warned that “the impact of low birth rates on the economy and society has begun to show.”

So giving birth is now a national issue too? Yes it is.

In 2017, the birth rate was 1.6 children per Chinese woman or below the 2.1 rate necessary to keep a population going.

The other consequence is the aging of the population, a problem that Europe can tell you a great deal about.

So what happens next? My guess is that the government will offer incentives to have children.

A few years ago, I heard a presentation of a Dallas man who had lived in China for a few years. He sold his business and just moved to China to experience for himself what was going on over there. He mentioned in the presentation that most Chinese companies do not have the maternity leave that encourages female employees to have babies. Worse than that, many women are not confident that they will get their jobs back.

We will see, but I think that China won’t be the last country to figure out that messing with Mother Nature has serious consequences.

PS: You can listen to my show (Canto Talk) and follow me on Twitter.

Source: http://cantotalk.blogspot.com/2018/08/time-to-invest-in-chinese-baby-food.html

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