An uncertain future awaits the world’s 7 billion people

By Frank Ching, special to The China Post

Quietly, without much notice, the world’s population crept past the 7 billion mark on Oct. 31, according to the United Nations. The majority of people live on one continent, Asia, with two countries, China and India, accounting for almost 37 percent of the total. What is striking is that while it took thousands of years for the population to reach the 1 billion mark — about 1830 — it took only 100 more years for it to hit two billion and, in the last eight decades, an additional five billion people were added. In the past there was a view that too big a population was a drag on economic growth. That certainly was behind China’s one-child policy, introduced by Deng Xiaoping after the death of Chairman Mao Zedong. Ironically, now, the world’s two most populous countries are also its most rapidly developing economies. In fact, the rise of China and India shows that a certain population size is necessary to achieve a critical mass for economic development.

In fact, economists project that India’s growth will outstrip that of China by about 2020 because, by then, the size of the Chinese labor force would have peaked while India would still have a young population, with a labor force set to grow to nearly a billion workers by 2050.

That is the demographic dividend at work, with a rise in the proportion of people of working age along with a fall in the fertility rate. Output per capita rises during this window of opportunity, before an ageing population lowers economic growth. Of course, population size alone is insufficient for economic growth, as Mao proved during his long years as China’s supreme leader.

An emphasis on politics over economics meant that the country’s working-age people simply did not have the opportunity to develop their potential. Also, as Professor Chu Shulong of Tsinghua University wrote recently, population growth “should also be accompanied by improvement of population quality at the same time, including education, skills, income, and consumption.

“In that case, population growth can generate active effects for economic development.” In the last three decades, the vast Chinese work force combined with low wages was perfect for processing and assembly, attracting capital and manufacturing industries from both Asia and the West. But of course this could not last, and there are many who believe that China is approaching — or has already passed — the Lewis Turning Point, when a surplus of cheap labor runs dry, and employers turn to other low-cost countries. The age-old struggle to get enough food to eat in China is reflected in the salutation that Chinese still use when addressing each other every day: “Have you eaten yet?”