China Proposes To Cut 2/3 Of Its $3 Trillion In U.S. Holdings

shamsheer

Senator (1k+ posts)
http://www.thefinancialphysician.com/blog/?p=6614

From ZeroHedge
China Proposes To Cut 2/3 Of Its $3 Trillion In U.S. Holdings
From China Proposes To Cut 2/3 Of Its $3 Trillion In U.S. Holdings Hedge
All those who were hoping global stock markets would surge tomorrow based on a ridiculous rumor that China would revalue the CNY by 10% will have to wait.
Instead, China has decided to serve the world another surprise. Following last weeks announcement by PBoC Governor Zhou (Wheres Waldo) Xiaochuan that the countrys excessive stockpile of USD reserves has to be urgently diversified, today we get a sense of just how big the upcoming Chinese defection from the buy US debt Nash equilibrium will be.
Not surprisingly, China appears to be getting ready to cut its USD reserves by roughly the amount of dollars that was recently printed by the Fed, or $2 trilion or so.
And to think that this comes just as news that the Japanese pension fund will soon be dumping who knows what. So, once again, how about that end of QE again?
From Xinhua:
Chinas foreign exchange reserves increased by 197.4 billion U.S. dollars in the first three months of this year to 3.04 trillion U.S. dollars by the end of March.
Xia Bin, a member of the monetary policy committee of the central bank, said on Tuesday that 1 trillion U.S. dollars would be sufficient. He added that China should invest its foreign exchange reserves more strategically, using them to acquire resources and technology needed for the real economy.
And as if the public sector making it all too clear what is about to happen was not enough, here is the private one as well:
China should reduce its excessive foreign exchange reserves and further diversify its holdings, Tang Shuangning, chairman of China Everbright Group, said on Saturday.
The amount of foreign exchange reserves should be restricted to between 800 billion to 1.3 trillion U.S. dollars, Tang told a forum in Beijing, saying that the current reserve amount is too high.
Tangs remarks echoed the stance of Zhou Xiaochuan, governor of Chinas central bank, who said on Monday that Chinas foreign exchange reserves exceed our reasonable requirement and that the government should upgrade and diversify its foreign exchange management using the excessive reserves.
Tang also said that China should further diversify its foreign exchange holdings. He suggested five channels for using the reserves, including replenishing state-owned capital in key sectors and enterprises, purchasing strategic resources, expanding overseas investment, issuing foreign bonds and improving national welfare in areas like education and health.
However, these strategies can only treat the symptoms but not the root cause, he said, noting that the key is to reform the mechanism of how the reserves are generated and managed.
The last sentence says it all. While China is certainly tired of recycling US Dollars, it still has no viable alternative, especially as long as its own currency is relegated to the C-grade of not even SDR-backing currencies. But that will all change very soon. Once the push for broad Chinese currency acceptance is in play, the CNY and the USD will be unpegged, promptly followed by China dumping the bulk of its USD exposure, and also sending the world a message that US debt is no longer a viable investment opportunity. In fact, we are confident that the reval is a likely a key preceding step to any strategic decision vis-a-vis US FX exposure (read bond purchasing/selling intentions). As such, all those Americans pushing China to revalue, may want to consider that such an action could well guarantee hyperinflation, once the Fed is stuck as being the only buyer of US debt.
 

Unicorn

Banned
Its a proposal I doubt it will ever materialize. If China wants to continue with its export surplus with the US and with the European union China have no choice but to accept "I owe yous" even when the US dollar is loosing ground.
 

shamsheer

Senator (1k+ posts)
Its a proposal I doubt it will ever materialize. If China wants to continue with its export surplus with the US and with the European union China have no choice but to accept "I owe yous" even when the US dollar is loosing ground.

Thanks to you guys this equation is going to change very soon. I was a part of a recent consumer based business conferece and we have been informed that NA/Europe are matters of Past now. The new emergining and more promising consumer market for the next few decades and starting very soon is India and Far east asia. Countries that are populous yet they have a huge middle class. Chinese export are more suited for people of sub continent anyway becuase they are consumable by both middle and lower middle class. You must have noticed that in the article it is mentioned that only 1 trillion USD is enough for china to maintain that surplus balance.
 

Unicorn

Banned
Thanks to you guys this equation is going to change very soon. I was a part of a recent consumer based business conferece and we have been informed that NA/Europe are matters of Past now. The new emergining and more promising consumer market for the next few decades and starting very soon is India and Far east asia. Countries that are populous yet they have a huge middle class. Chinese export are more suited for people of sub continent anyway becuase they are consumable by both middle and lower middle class. You must have noticed that in the article it is mentioned that only 1 trillion USD is enough for china to maintain that surplus balance.

We really don't have anything to do with it. We are lucky that we have a Prime Minister who is a an excellent economist and have established very prudent economic, trade and monitory polices. If US and Europe continue with huge trade deficit its not very good for them as well as for China they will all go down together.

India does not give China " I owe yous" it only insists the the trade is balanced with in a short time with specified field of goods on a blue print. That Makes India a solid trading partner.
 
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shamsheer

Senator (1k+ posts)
We really don't have anything to do with it. We are lucky that we have a Prime Minister who is a an excellent economist and have established very prudent economic, trade and monitory polices. If US and Europe continue with huge trade deficit its not very good for them as well as for China they will all go down together.

India does not give China " I owe yous" it only insists the the trade is balanced with in a short time with specified field of goods on a blue print. That Makes India a solid trading partner.

Sorry to diappoint you but when I said thanks to you, it only meant the population. There are better economists siting in other parts of the world and have exceedingly better monetary policies but due to their indulgence in somebody else's war and lack of population they cannot be as strong training partner as you are. I just wanted to be clear on what I meant. India has a long way to go.
 

Unicorn

Banned
Sorry to diappoint you but when I said thanks to you, it only meant the population. There are better economists siting in other parts of the world and have exceedingly better monetary policies but due to their indulgence in somebody else's war and lack of population they cannot be as strong training partner as you are. I just wanted to be clear on what I meant. India has a long way to go.

I don't know how you view everything our overpopulation is a liability not an asset. You may have the best economists but we are content with what we got. You are absolutely correct we have long way to go.
 

shamsheer

Senator (1k+ posts)
I don't know how you view everything our overpopulation is a liability not an asset. You may have the best economists but we are content with what we got. You are absolutely correct we have long way to go.

Dear Unicorn! if you think your population is liability then you are living in the past. Population has never been a liability of a nation ever, I mean ever in the history. In the past we were made to believe that population is a liability. You may want to call me a conspiracy theorist but I believe that some body did not want the number of people to grow to a limit that it become uncontrolable for them. You may want to read an article published by Henry Kessenger in 70s or 80s, that may help you understand why and who may be. The economic activity that we see today in India and China is a fruit of population. It is the matter of proper distribution of wealth that can put India on a much faster track of bloom and gloom.
The economists of today consider population as the biggest asset. To give you an apple to apple match. Everything is more expensive in Canada than in US. There is no comparison between US and Canada in terms of
1- Population US >>> Canada
2- Natural Resources per person Canada >>>> US
3- Per sq mile of land occupied per x number of people Canada<<<<<<<<<<<<<<<<<<<<<<<<<<< US

Then why this low population such a head ache for Canada. Becuase
Less consumer means less business means less net income for business men.
With all the positive factor above, Canadians pay very high car insurance (less people to share the burden as US), pay more for per merchendise (less consumption in Canada) and so on.

Simple equation is, if I have 100 buyers of a car in Canada I have 1000 in US, do the math. Every body in a country is an asset, it is a liability for the upper class only becuase they usually do not like Bhookay nangay mangtay people.
 

Unicorn

Banned
Dear Unicorn! if you think your population is liability then you are living in the past. Population has never been a liability of a nation ever, I mean ever in the history. In the past we were made to believe that population is a liability. You may want to call me a conspiracy theorist but I believe that some body did not want the number of people to grow to a limit that it become uncontrolable for them. You may want to read an article published by Henry Kessenger in 70s or 80s, that may help you understand why and who may be. The economic activity that we see today in India and China is a fruit of population. It is the matter of proper distribution of wealth that can put India on a much faster track of bloom and gloom.
The economists of today consider population as the biggest asset. To give you an apple to apple match. Everything is more expensive in Canada than in US. There is no comparison between US and Canada in terms of
1- Population US >>> Canada
2- Natural Resources per person Canada >>>> US
3- Per sq mile of land occupied per x number of people Canada<<<<<<<<<<<<<<<<<<<<<<<<<<< US

Then why this low population such a head ache for Canada. Becuase
Less consumer means less business means less net income for business men.
With all the positive factor above, Canadians pay very high car insurance (less people to share the burden as US), pay more for per merchendise (less consumption in Canada) and so on.

Simple equation is, if I have 100 buyers of a car in Canada I have 1000 in US, do the math. Every body in a country is an asset, it is a liability for the upper class only becuase they usually do not like Bhookay nangay mangtay people.

Bro I said OVERPOPULATION is a huge liability both for India and China. Why would the dictators of China implement one child policy only if it wasn't the case. If you still stand by your note then one of us have got it horrible wrong.
 

ASQR1

Chief Minister (5k+ posts)
Its a proposal I doubt it will ever materialize. If China wants to continue with its export surplus with the US and with the European union China have no choice but to accept "I owe yous" even when the US dollar is loosing ground.

My Bor. china has so many options.

1. China should buy all the gold reserves that U.S. is holding.
2. china should buy all the Real Estate in U.S.
3. China can and should buy all the transportations that moves the world oil, commodities, such as shipping industry, air lines, courier industry.
4. china can and should control all the settlite TV systems thereby controlling the mind set of people like you and me.
5. China should and upgrade poor Nation by investing in then so that it can create new markets for its commodities. and it will than also upgrade the lives of Poor people.
6. China can and should develop Agriculture in their friendly countries like Pakistan where it is ripe for the picking as its Punjab area is ready to be use for great agriculture developments.
7. china should not gear its industry only for weapons manufacture, because that can cause its industry Dependant on wars. and will have to start wars for it to survive.


I can give you many more, but for now I will these for you to ponder.

(jhanda) (clap)
 
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ASQR1

Chief Minister (5k+ posts)
Bro I said OVERPOPULATION is a huge liability both for India and China. Why would the dictators of China implement one child policy only if it wasn't the case. If you still stand by your note then one of us have got it horrible wrong.

That was the consequences of the world telling Chines so, But chines know it better now to not to listen to others but do its own thing.

And behold when they did their own thing, they work wonders.
 

Unicorn

Banned
My Bor. china has so many options.

1. China should buy all the gold reserves that U.S. is holding.
2. china should buy all the Real Estate in U.S.
3. China can ans should buy all the transportations that moves the world oil, commodities, such as shipping industry, air lines, courier industry.
4. china can and should control all the settlite TV systems thereby controlling the mind set of people like you and me.
5. China should and upgrade poor Nation by investing in then so that it can create new markets for its commodities. and it will than also upgrade the lives of Poor people.
6. China can and should develop Agriculture in their friendly countries like Pakistan where it is ripe for the picking as its Punjab area is ready to be use for great agriculture developments.
7. china should not gear its industry only for weapons manufacture, because that can cause its industry Dependant on wars. and will have to start wars for it to survive.


I can give you many more, but for now I will these for you to ponder.

(jhanda) (clap)

Bro you are dreaming if they could they would have done it. What they hold in their hand are US Treasury bills and they survive by issuing their own currency backed up by those treasury bills. Sure if China insists they could have those bills converted to dollars that leave US with no choice than to print money and give it to them. Give them your advise and see what they say to this they have a lot more to loose in doing so than US.
 

shamsheer

Senator (1k+ posts)
Bro I said OVERPOPULATION is a huge liability both for India and China. Why would the dictators of China implement one child policy only if it wasn't the case. If you still stand by your note then one of us have got it horrible wrong.

This article will help you to understand who went wrong. A living example of deadly effects of birth control is Japan's aging population.

http://muse.jhu.edu/journals/china/v002/2.1peng.html

Here is a text copy with the important graphs.

Is it Time to Change China's Population Policy? Peng Xizhe


One of the notable features of China's family planning programme is its decentralised policy formation and programme implementation despite being formed at the end of the 1970s soon after the Cultural Revolution when central planning still dominated. 1 It is formulated and implemented primarily by the provincial governments though local authorities are given some flexibility in adapting the national policy to particular social, economic and cultural conditions locally. As a result, slightly different programmes have been applied in different localities. In the 1970s, this regional diversity was reflected in the implementation of different local regulations pertaining to marriageable age and birth intervals. The current family planning regulations can be grouped into five major categories (see Table 1). 2 Had all Chinese couples followed the local family planning regulations, the total cohort fertility rate in 1990 would have been 1.62, and 1.50 in 1999 as more people became urban residents and changed their birth control categories. 3 Therefore, the notion of "One Child Policy" (OCP) is actually an oversimplification. However, as the term is widely accepted, it will be used in this article.
By the late 1990s, the total fertility rate (TFR) ranged from below one in Beijing and Shanghai, to 3.11 in Tibet. Although it declined nation-wide in the 1990s (see Figure 1), the regional pattern remained more or less the same as in earlier decades (Figure 2). 4 On the whole, the rapid and continuous fertility decline has slowed down China's population growth. 5 It is estimated that in the last three decades, roughly 300 million births were avoided. 6 [End Page 135]

Click for larger view Table 1
Comparison of Various Local Family Planning Regulations, 1990s
Sources: Details of provincial family planning regulations are available at <www.cpirc.org.cn> [15 Aug. 2002].



Click for larger view Figure 1
Total Fertility Rate in China, 1950-2000
Sources: Data before 1995 is from Zhongguo jihua shengyu nianjian weiyuan hui (China Family Planning Yearbook Editorial Committee), Zhongguo jihua shengyu nianjian (China Family Planning Yearbook) (Beijing: China Population Publishing).

[End Page 136]


Click for larger view Figure 2
Provincial Fertility Pattern in China, 1997-9 (%)
Note: Based on estimations by China's State Family Planning Commission. Data for Taiwan, Hong Kong and Macao are not included.

[End Page 137] Major Concerns about China's Current Population Policy and Programme


Some of the controversy over the OCP has to do with the policy itself, while some is related to its implementation. The first round of debate occurred in 1984 when the central government under Zhao Ziyang tried to modify the policy by issuing Government Directive No. 7 which aimed at decelerating the implementation of the programme. This was politicised after the 1989 Tiananmen event and branded by some conservative Party officials as one of Zhao Ziyang's wrongdoings. 7 Since the early 1990s, when China's fertility rate began to approach below replacement level, the discussions have become more open and have incorporated more scientific findings.
At the launch of the OCP, the intention was made clear that this should be a policy measure for a period of only 20 to 30 years. 8 After more than 20 years of implementation, it has met its primary objective of slowing down China's population growth. On the other hand, there are also profound socio-economic and demographic consequences. Current policy debates have concentrated on these issues. Population Aging


A major debate is centred on China's aging population. In 2000, there were 88.11 million elderly (people over 65 years), and the proportion in the total population for the first time in China's history exceeded seven per cent, indicating that for the country as a whole, China had become an "aged society". 9 An aging population has long been a major challenge facing many cities and the wealthier rural areas in the eastern region. In Shanghai, 13 per cent of the city population is 65 and above. Regional variations in population aging are very similar to the regional variations in current fertility, indicating that the aging process is mainly determined by the decline in fertility (see Figure 3). [End Page 138]

Click for larger view Figure 3
Regional Variations in Population Aging, 2000
Source: National Bureau of Statistics of China, China Statistical Yearbook 2001 (Beijing: China Statistics Press), p. 95.


Aging is occurring worldwide. In the next 50 years, the proportion of people over 65 will more than double, growing from 6.8 per cent of the global population to 15.1 per cent. 10 However, unlike many developed countries, aging in China is coming at a much earlier stage in terms of socio-economic development. It is also occurring over a shorter time span.
It is projected that it will take only 27 years for the percentage of the population 65 and above in China to increase from the current seven per cent to 14 per cent. The rapidity of this change is in sharp contrast to some European countries, where the comparable change occurred over a period of 85 to 115 years. 11 It is also estimated that by the middle of this century, while India takes over China in becoming the most populous country in the world, China will remain the country with the largest elderly population worldwide. 12 [End Page 139]
This rapid aging of the population has already put great pressure on China's socio-economic development, especially on the social welfare system. The heavy pension and medical care obligations are regarded as one of the major causes of the infamously low efficiency at the country's state-owned enterprises. Even after two decades of reform, however, the current system suffers from a variety of shortcomings, and faces tremendous difficulties in the old industrial base regions especially where there is a higher level of population aging. There are frequent reports of social unrest linked to pensions. 13
China's current state-supported pension system and other social welfare provisions are highly urban biased. There is very limited social welfare provision for the rural elderly. The fertility transition facilitates the decline of average family size and rapid nuclearisation of the family. The reductions in economic returns from cultivated land and the weakening of family support have made the elderly in the countryside more vulnerable.
By 2030, the aging phenomenon in China will peak. 14 At present, the government is insufficiently prepared to cope with the problem. Some advocate relaxing the OCP to slow down the aging process and create a relatively favourable age structure in the future. However, this argument is flawed in that the potential increase of young people cannot solve the aging problem in the short to medium term, and may actually give rise to a higher child-dependency ratio in the immediate future. This could lead to a larger population in the long term, thereby worsening the situation. The urge for policy relaxation is strongest in areas with a very low fertility rate, such as some coastal regions. 15 Abnormal Sex Ratio


Anabnormal sex ratio at birth is another issue linked to China's OCP. Researchers in the late 1980s attributed the situation mainly to mis-reporting of births. 16 [End Page 140] However, it soon became clear that it was real and that pre-birth selective abortion in favour of boys was the primary cause. 17 The government has employed tough measures to try to prevent and reverse the trend, but with very limited success. The continuous and increasing skew in the sex ratio at birth indicates that the situation has worsened over the years. 18 In 1982 it was 108.5, and 110.9 by 1987, 111.3 by 1990, 115.6 by 1995 and 116.9 by 2000. 19 From Table 2 it can be seen that there are regional variations.

Click for larger view Table 2
Comparison of Various Local Family Planning Regulations, 1990s
Source: China's 2000 Population Census, <http://www.sfpc.gov.cn/cn/news20020516> [25 Nov. 2002].


Some blamed the rigid implementation of the family planning programme as the major cause. Indeed, there is some kind of relationship between the fertility level and abnormality of sex ratio at birth. Provinces with a normal or slightly higher sex ratio at birth actually belong to two groups. One is where there is a concentration of minority people and the fertility rate is relatively higher, the other group is where there is low fertility. The most serious problem is occurring in the provinces/regions which fall somewhere in between. [End Page 141]
However, similar abnormality can also be found in South Korea and India where there are very different family planning programmes. 20 It is believed that attempting to solve the problem by relaxing the population policy will have little impact, especially if the situation has been brought about by a rapid fertility decline, and in a society which has a strong preference for sons. 21 Nevertheless, if not arrested, the problem will have profound social implications in the future, such as insufficient brides, women's status, etc. Population Quality


Another concern is China's overall population quality. Some argue that China's current population policy has a "negative selection" process as it requires urban residents and people with higher social and education status to have fewer children, but grants poor farmers the right to have more. This, they argue results in a deterioration of the overall quality of the Chinese population. The counter-argument emphasises the importance of education in raising population quality. They stress that a smaller population would make it easier for society to enhance the educational quality of the entire Chinese population, while a larger population further jeopardises it. 22 The debate continues. Sometimes proposals to adapt a Singapore-like policy allowing couples with higher education to have more children are discussed. 23
There is also worry about the negative social impact of the single-child generation. By 2001, there was a total of 80 million single children in China. These people are usually considered self-centred, individualistic, less socially responsible, and less able to care for themselves and their families. However, not all academic researchers fully support this stereotyping. 24 Furthermore, there is a worldwide trend towards single child families. 25 [End Page 142] Future Population Growth


The fundamental issues are the extent to which the Chinese population will grow, and the future relationship between the population, resources and environment. There are various population projections based on different assumptions on fertility and mortality. 26 Even according to the lowest projection, the total population will increase by at least 100 million to 1.4 billion before the growth finally stops around the middle of the 21st century. Figure 4 portrays one such population projection.

Click for larger view Figure 4
China's Population Projection, 2000-2050
Note: Projections based on assumption (1) TFR = 1.8, and assumption (2) TFR = 2.0
Source: China State Family Planning Commission, <http://www.sfpc.gov.cn> [3 Nov. 2002].


China is a vast country with abundant natural resources. The large population, however, has caused almost all of the per capita indicators to be well below the world average. Further population growth will no doubt put more pressure on China's fragile environment and aggravate the relationship between population [End Page 143] and natural resources. It is interesting to note that Chinese economists and environment researchers are usually more inclined to prefer a smaller population and rigid population policy, while demographers and sociologists are in favour of a more balanced population. Government Role


In China's new socio-economic era, there are debates over the capacity of the government to influence the situation. This is linked to concerns about the vulnerability of China's fertility transition, and the possibility of a rebound in fertility if the government loses control of population growth. The accuracy of the current population statistics is at the root of all these discussions. There is a general consensus about the general level of China's fertility and the size of the total population which are derived from various nation-wide population surveys and reports. Many researchers, however, are suspicious of the real population figure, especially at the regional level. 27 It seems that so far, the 2000 population census has not made the situation much better. Any future policy changes must address the need to obtain a credible database with solid information.
The administrative restructuring to date has affected 400,000 family planning personnel nationwide, and to some extent has shaken the foundations of China's family planning programme. In places where population growth has already been checked, the local government would like to spend more money on economic related policies. Yet, in certain parts of the countryside, where the fertility rate is still relatively high, the comprehensive rural fiscal reform (fei gai shui or changing from fees to taxes) has put more financial constraints on grassroots family planning networks.
The success of China's population programme is not without cost, politically and socially. Indeed, many have regarded it as the most difficult task of the PRC government (tianxia diyi nan). Apart from the direct economic costs, the hidden costs of the programme can never be accurately estimated. The tension between the government and public over the permitted number of children is one such type of hidden cost. Thus, there is a desire to modify the OCP to make it equate better with couples' fertility desires. Questions are raised about the government's role in phasing out the programme. Some say that market forces and NGOs should be involved in providing family planning services, while the government [End Page 144] should concentrate on policy-related matters only. Nonetheless, there are those who take a more optimistic view, and highlight the government's determination and capacity to implement family planning. In March 2003, the State Family Planning Commission formally became the National Population and Family Planning Commission of China. It has enlarged responsibilities for strategic research on population issues and collaboration between different government agencies. 28 The restructuring is aimed generally at strengthening the capacity of family planning policy-making and programme implementation. Reproductive Health and Reproductive Rights


Since the 1994 International Conference on Population and Development, reproductive health has gradually become a component of China's family planning programme. Supported by the United Nations Population Fund and other international donors, several nationwide projects have been sponsored by the Chinese authorities since the mid-1990s focusing on the provision of quality reproductive health services. 29 These projects emphasise people's voluntary participation and individual rights and promote free choice of birth control methods (zhiqing xuanze). Though only at the experimental stage, they may potentially have a long-reaching impact on China's approach towards population control. It is hoped that the coercive element of China's programme can be eliminated.
China's population programme is gradually giving more respect to the welfare of the individual. Some researchers argue that the numerical birth quota should be abolished from China's family planning programme. Others advocate that the responsibility of men in reproductive matters should be raised. According to official data, the use of male contraceptive methods (male sterilisation and condoms) accounted for only 13.1 per cent of all contraceptive usage in 2001, with the majority of couples relying on female methods, especially long-term ones such as IUD (47.17 per cent) and female sterilisation (36.86 per cent). 30 [End Page 145]
High-ranking family planning officials from China have visited Sweden and the US to learn more about western views and approaches to population-linked reproductive health and rights. One consequence has been the deletion of words and phrases from local regulations that may provoke international criticism. On the whole, international cooperation is facilitating the process of the so-called "two transitions" in China's family planning programme, namely the transition from focusing narrowly on family planning itself to combining family planning with socio-economic development, and the transition from focusing on social control to a combination of social control and an interest-oriented mechanism. Furthermore, China's active participation in international human rights activities, including ratification of the International Covenant on Civil and Political Rights, and entry into the WTO will also help safeguard the reproductive rights of Chinese people.
It is certain that after more than 30 years of family planning, most Chinese couples seek to have smaller families. The present social environment makes implementation of a population control programme easier than before. Two children per family is still the most desired family norm for Chinese couples, no matter whether they live in rural or urban areas. This norm has been more or less consistent over the last two decades. 31 The Timing and Methods of Policy Change


It is argued that the current age structure of Chinese women is not favourable for an immediate change in population policy. A new baby boom is feared because over the next 10-15 years there will be a steady increase in the total number of women of reproductive age. There is concern that the single-child cohort born in the early 1980s will soon marry and produce children, and that any relaxation of the current population policy will have a doubling effect on the total population. 32 Therefore, the general view is that it is better to wait until the 2010s to make any major policy change so that the overall population age structure can adjust smoothly. [End Page 146]
There is also uncertainty over whether the change should take effect from a specific point in time, or apply to some specific population groups. 33 In reaching a decision, the fairness to couples and ease of implementation must both be considered. It is interesting to note that many family planning professionals believe that maintaining the current policy is the optimum course for the time being. Current Position and Future Prospects


The already very low fertility rate is one dilemma that the Chinese government faces. While there is little room for further reduction of individual family size, the need is still pressing to slow down absolute population growth. Another, is the age structure issue. The increase in the proportion of people aged 65 and over needs to be slowed down. However, relaxation of the OCP could lead to a bigger population, which would in turn jeopardise efforts aimed at addressing the aging problem.
The decade-long population debates have fortunately resulted in some consensus, namely that China's current population policy should be generally maintained over the coming few years but local modification, at least as pilot experiments, should be conducted. Many provinces are now modifying local family planning regulations to allow more people in certain categories to have two children. 34 A "natural transition" towards a "two children per family" norm will be gradually put in place. 35
As for the aging issue, it is an important period from now till the 2020s. This is because the dependency ratio is most favourable when both child and old-age dependency ratios are low. If sufficient jobs can be provided for the largest-ever working age population, there will be a one-time "demographic bonus" for development, such as in Japan, Hong Kong and various other east Asian economies. 36 China, therefore, must grasp the opportunity to develop its economy [End Page 147] and reform its social welfare system to cope better with the serious aging problem after the 2020s. Nevertheless, the transfer of some dependency burden from the current generation to the next is inevitable.
The methods and approaches of China's family planning programme should be changed. While the interests of society remain the major rationale, the right of the individual should also receive more attention. Reproductive health and rights should be respected. The public's voluntary participation should be treated as the basic approach of the programme. Also, the family planning programme should be more closely integrated with other socio-economic programmes.
In March 2000, the government issued a directive reaffirming its commitment to population control. 37 It indicated that the present population policy would more or less be maintained for the coming years, allowing some minor modifications. In this context, the government population policy will decide the basic level of China's fertility, at least in the early years of the 21st century.
Deviation from this line will be determined jointly by the ability of the government to implement its policy and programme; the impact of continued social, economic and political reform; and the people's general desire for an ideal family size. Most likely, the Chinese government will maintain its commitment to population control and make every effort to achieve its population target in the 21st century. 38 At the same time, people's voluntary participation and preference will play much more important roles in determining the future fertility level in China.
Efforts to formulate a Family Planning Law began in the late 1970s. Although population control is written in China's Constitution and other national laws such as the Marriage Law, it was only on 29December 2001 that the Law was formally passed by the Standing Committee of China's National People's Congress at its 25th meeting, after more than 20 years of preparation, four rounds of debate and more than 30 drafts.
The Law came into effect as of September 2002. Though its 47 items mainly reaffirm existing policy guidance and principles, its implementation does have [End Page 148] significant implications for China's future population policy and programme. It makes clear that the current population policy will more or less remain unchanged in the near future, but the responsibility of modifying policy measures and regulations is assigned to provincial/regional governments, based on local conditions. It also legalises the position of the family planning network, especially the technical service network, thus bringing to an end the decades-long dispute between the family planning programme and Public Health Bureau. 39
The Law emphasises the establishment and improvement of the interest-oriented mechanism related to population and family planning, and also tries to balance the rights and obligations of the government and individual in relation to family planning issues. Considering the huge regional disparities of the country, the State law can only provide a basic guideline for the country's family planning policy and define the basic rights and duties of citizens. The most difficult aspect of the work remains at the grassroots.
The renaming of China's State Family Planning Commission in March 2003 to the State Population and Family Planning Commission demonstrates the wider administrative and coordination functions assigned it by the State Council. Although China's overall population policy will remain, there will undoubtedly be some modifications and gradual changes in implementation measures over the next few years which reflect recent debate over changing the social levies placed on couples who give birth to more children than permitted, and other developments.


Peng Xizhe ([email protected]) is Director of the Institute of Population Research at Fudan University, Shanghai. He received his PhD in population studies from the London School of Economics. His main research interests include China's population dynamics, population programme, social security reform and labour force, as well as gender studies.
 

Unicorn

Banned
This article will help you to understand who went wrong. A living example of deadly effects of birth control is Japan's aging population.

http://muse.jhu.edu/journals/china/v002/2.1peng.html

Here is a text copy with the important graphs.

Is it Time to Change China's Population Policy? Peng Xizhe gender studies.

This article simply says time to change China's Population Policy. There is nothing in this that suggests that more population is an asset. It simply and correctly points out the drawbacks of one child policy. It states that it would be terrible if there is a very large elderly population, as a result of one child policy, with a tiny working adult population. It states that the urban and rural populations must be taken into account and revisions must be made from time to time on order to control population.
 
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shamsheer

Senator (1k+ posts)
This article simply says time to change China's Population Policy. There is nothing in this that suggests that more population is an asset. It simply and correctly points out the drawbacks of one child policy. It states that it would be terrible if there is a very large elderly population, as a result of one child policy, with a tiny working adult population. It states that the urban and rural populations must be taken into account and revisions must be made from time to time on order to control population.

Let's assume we were having this conversation at star bucks coffee shop. At this point I would like to put a smile on my face, thank you for the good conversation and wish you good luck.
 

only_truths

Minister (2k+ posts)
Bro I said OVERPOPULATION is a huge liability both for India and China. Why would the dictators of China implement one child policy only if it wasn't the case. If you still stand by your note then one of us have got it horrible wrong.
You said it right.To some extent population growth is good for countries to succeed as they depend on young population create wealth. But once that is achieved, over population will be a drain on the country's economy, as natural resources for any country is limited to Nature"s gift.
 
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ASQR1

Chief Minister (5k+ posts)
Bro you are dreaming if they could they would have done it. What they hold in their hand are US Treasury bills and they survive by issuing their own currency backed up by those treasury bills. Sure if China insists they could have those bills converted to dollars that leave US with no choice than to print money and give it to them. Give them your advise and see what they say to this they have a lot more to loose in doing so than US.

I gues you are not upto date in Chines affairs, and you have not read the Statement by Chinese president in the Asean meeting taking place in China, go read it and come back.

What i said was the steps Chinese are on their way taking them one at a time, BRO. But they have choices. Read on part of it in th following web pager.

http://www.thenewstribe.com/2011/04/15/chinese-president-calls-for-inclusive-development-in-asia/
 
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Unicorn

Banned
I gues you are not upto daste in Chines affairs, and you have not read the Statement by Chinese president in the Asean meeting taking place in China, go read it and come back.

What i said was the steps Chinese are on their way taking them one at a time, BRO. But they have choices. Read on part of it in th following web pager.

http://www.thenewstribe.com/2011/04/15/chinese-president-calls-for-inclusive-development-in-asia/

Here is the whole article and highlight the area that talks about Chinese going about buying satalites and other stuff you mentioned.

He is talking about an Asian bloc of countries and this is a good idea. That way non of the countries in the Bloc have to rely on the US dollar a common currency will do for internal trade with in the Bloc. It can be done will take some time and difficulty.

BOAO: Chinese President Hu Jintao on Friday called for inclusive development in Asia as he attended the opening ceremony of the 2011 annual meeting of the Boao Forum for Asia (BFA). As the second decade of the 21st century dawns upon us, Asia is at a new starting point in its development, President Hu said as he delivered a keynote speech at the forum’s opening ceremony in China’s southern town of Boao.
“As the trend toward multi-polarity and economic globalization deepens, the people of Asia have the major task of maintaining both development and stability,” he said.
“That is why the theme of this year’ s BFA annual conference — Inclusive Development: Common Agenda and New Challenges — is so relevant,” said the President.
Among attendants of the meeting are Russian President Dmitry Medvedev, Brazilian President Dilma Rousseff, South African President Jacob Zuma, Republic of Korea (ROK) Prime Minister Kim Hwang-sik, Spanish Prime Minister Jose Zapatero and Ukrainian Prime Minister Mikola Azarov.
More than 1,400 personages from around the globe attended the meeting, which marked the tenth anniversary of the inauguration of the Boao Forum.
“Asians belong to one family,” said the Chinese leader, adding that the people of Asia have a shared mission to promote common development and build a harmonious Asia.
Hu proposed that Asian countries respect diversity of civilization and promote good-neighborly relations.
“We need to translate the diversity of our region into a driving force for more dynamic exchanges and cooperation, increase mutual understanding and trust, and take our cooperation to higher levels,” he said.
The Asian countries need to transform their economic development pattern in keeping with global trends, restructure their economies, build capacity for scientific and technological innovation, and develop the green economy, said the President.
“We need to focus on both the speed and quality of development, and ensure both efficiency and quality,” he added.
“We need to integrate our effort to develop the economy with that to improve people’ s well-being, and achieve coordinated economic and social development,” he said.
Hu said that Asian countries need also to share development opportunities and meet challenges together.x “Large countries should support small ones, rich countries should help poor ones and all should help each other so as to seize opportunities and tackle challenges together,” said Hu.
 

ASQR1

Chief Minister (5k+ posts)
and now you know, and by the way did you not read about diversity and respect and fair treatment for each other.

So my question to you is that when India is going to respect Kashmiris wishes with a fair plebiscite.




When
 
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