Comment on “The Social Protection System in Ageing China”

• Published date: 01 July 2015
• DOI: http://doi.org/10.1111/aepr.12105
• Date: 01 July 2015
• Author: Long Ke

Comment on “The Social Protection System

in Ageing China”

Long KE†

Fujitsu Research Institute (FRI)

JEL codes: J26, H53, H55

China started to test an open market policy and economic reform 35 years ago, and

decided to build a market-oriented economy 20 years ago. There are still a lot of prob-

lems with the very Chinese economic reforms. The Chinese government in the Deng

Xiaoping era postponed many difficult reforms, such as political reform and financial

reform. Many people doubt whether the Chinese economy is sustainable.Theoretically, it

is considered that the Chinese economy is going to slow down because of the decline of

the population and the dynamic ageing problem.

China’s leaders have emphasized many times the necessity to create an effective and

equal social protection system in China. But the social protection system is still very

poor, unequal, and not enough to cover all of the people in China. China does not have

an integrated pool for different groups, for example government officials, residents in

urban areas, and residents in rural areas. Institutionally, officials are protected perfectly

by the special pool, but the residents in rural areas are in a terrible situation, many of

them are not protected by any social protection system,especially the residents of inland

China like Guizhou, Guangxi, Qinghai, and Gansu. So how to build an integrated social

protection system is an urgent problem for China, otherwise China cannot stabilize its

society. Cai and Du (2015) point out the problem of the integration of the social protec-

tion system. It is a very important point in their paper, but this integration does not only

mean the integration of the pools for residents in urban and rural areas, it also means the

integration of the pools for officials and non-officials. In China, the officials are a privi-

leged class.

Another point here is how to overcome the ageing problem. China enforced a one

child policy about 40 years ago. This policy was aimed at controlling the increasing

population because the Chinese population increased rapidly in Mao Zedong era. As a

result, China faced the problem of serious food shortage. The dynamism of the popula-

tion was changed by the one child policy. According to some studies in China, the one

child policy reduced the population by 400 million people over the past three decades.

The policy helped China overcome the food shortage and also supported economic

growth. But the legacy of the policy is the ageing problem. The problem is how to care

for so many old people while the social protection system does not function effectively.

The Chinese government decided to deregulate the one child policy, and has promised

†Correspondence: Long Ke, Fujitsu Research Institute (FRI), 1-16-1 Kaigan, Minato-ku, Tokyo

105-0022, Japan. Email: kelong1029@yahoo.co.jp

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doi: 10.1111/aepr.12105 Asian Economic Policy Review (2015) 10, 273–274

© 2015 Japan Center for Economic Research 273