The Chinese government has approved a $500 childcare subsidy for mothers, aiming to ease financial burdens on families and encourage more births amid a growing demographic crisis.
The move comes as China’s population has declined for three consecutive years, with United Nations demographic projections warning it could shrink from 1.4 billion today to just 800 million by 2100.
According to a spokesperson from China’s National Health Commission, the policy is expected to benefit more than 20 million families each year.
Beijing’s state broadcaster CCTV noted on Monday that the nationwide subsidies apply retroactively from January 1, 2025, citing a decision by the ruling Communist Party and the State Council, China’s cabinet.
“This is a major nationwide policy aimed at improving public wellbeing,” CCTV said.
“It provides direct cash subsidies to families across the country, helping to reduce the burden of raising children,” it added.
A health commission official, speaking to Xinhua, explained that providing direct cash subsidies is expected to ease the financial strain of raising children and help address fertility concerns commonly experienced by young couples.
“The government will give families $500 a year for each child under the age of three. The subsidy will be applied from January 2025, but families with children born between 2022 and 2024 can apply for partial handouts,” Xinhua stated.
There were just 9.54 million births in China last year, half the number recorded in 2016 — the year it ended its one-child policy, which had been in place for more than three decades.
The population declined by 1.39 million last year, and China lost its crown as the world’s most populous country to India in 2023.
The subsidies also follow months of calls for the government to support household consumption. While China recorded real economic growth of 5.2 percent in the second quarter, widespread falling prices meant nominal growth was much weaker at 3.9 percent.
