China Signals End to Child Birth Limits by 2020 at Latest

(Bloomberg) -- China’s parliament struck “family planning” policies from the latest draft of a sweeping civil code slated for adoption in 2020, the clearest signal yet that the leadership is moving to end limits on the number of children families can have.

A new draft of the Civil Code submitted Monday to the Standing Committee of the National People’s Congress removed all “family planning-related content,” according a report published Tuesday in the Communist Party’s People’s Daily newspaper. That would suggest that the decades-old birth restrictions wouldn’t be enforced after the law goes into effect, since the code is intended to govern all aspects of private life from contracts to company registrations to marriages.

Bloomberg News reported in May that the country was planning to scrap birth limits as soon as this year. It would be a landmark end to a much criticized policy -- one of history’s biggest social experiments -- that left the world’s most-populous nation with a worker shortage and an aging population comprised of 30 million fewer women than men.

Shares of companies that stand to gain from the policy shift were muted Tuesday, suggesting the market had already priced in the change. Baby-apparel maker Qibu Co. climbed 2.3 percent as of 11:04 a.m. in Shanghai, while Cre8 Direct Ningbo Co., an office-supply maker that also produces children’s stationary, rose 0.8 percent in Shenzhen.

Demographic trends are weighing on President Xi Jinping’s efforts to develop China’s economy, driving up pension and health care costs and sending foreign companies looking elsewhere for labor. China’s State Council last year projected that about a quarter of its population will be 60 or older by 2030 -- up from 13 percent in 2010.

Chinese health authorities are studying the possibility of financial incentives to boost population growth, local media reported in July. That was a sign that policy could soon move toward encouraging child birth, some three years after limits were relaxed to allow families to have two children instead of one.

Such consequential decisions would require party approval, which could come as soon as an expected meeting of the party’s Central Committee in the fourth quarter of the year. The final draft of the Civil Code was expected to submitted to the National People’s Congress for passage in the first quarter of 2020.

“Family planning has always come first as policy and then become law,” said He Yafu, an independent demographer based in Guangdong and long-time advocate for policy changes. “It is expected that the policy would be lifted by the party first, then the legal procedures would follow to remove it in relevant laws.”

Earlier this month, a Chinese government researcher predicted an end to restrictions on the number of children a family can have.

“It has become an irresistible trend to allow people to make their own decisions on fertility, which will be the direction for the adjustment of population policy in the future,” Zhang Juwei, director of the state-run Chinese Academy of Social Sciences’ Institute of Population and Labor Economics, told China Newsweek magazine.

To contact Bloomberg News staff for this story: Dandan Li in Beijing at dli395@bloomberg.net

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With assistance from Editorial Board