China reveals its first nationwide childcare subsidy program

(MENAFN) China has introduced its first national childcare subsidy, offering families 3,600 yuan (around $500) annually for each child under three years old. Announced Monday, the policy is the latest in a series of government efforts to reverse the country’s declining birthrate and address its long-term demographic challenges.

The move comes amid concerns over a shrinking population and a rapidly aging society, which have raised alarms about future labor shortages and economic growth. Although China’s population saw a modest rebound in 2024, it had declined for seven consecutive years prior, driven largely by a steep fall in birthrates and increased economic uncertainty among young families.

This new program, set to launch later this year, is expected to support more than 20 million families annually, according to the Chinese National Health Commission. The subsidy will be provided each year until a child reaches the age of three, and it applies to all children regardless of whether they are the firstborn or not. Importantly, the payment will be tax-exempt and won’t affect eligibility for other forms of social aid.

The initiative represents a notable policy shift following decades of strict population control. Since the end of the one-child policy in 2015, China has successively raised its family size limits, allowing two and later three children per household. Yet despite these changes, the country has struggled to raise its birthrate. In 2024, China registered approximately 9.5 million births—up slightly from previous years, but still nearly half the total recorded in 2017.

Officials hope that this latest financial support measure, along with other previously implemented efforts like extended parental leave and tax incentives, will encourage more families to have children and help stabilize the country’s demographic outlook.

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