Summary
China's birth rate has dropped to its lowest level since 1949, and Trip.com cofounder James Liang warns this could hurt the country's ability to innovate. Liang believes that fewer people means less talent for research and development, which could slow down technological progress. He argues that governments need to spend much more on family-friendly policies to reverse the trend. The issue is not just in China but across much of Asia and the world, where birth rates are falling below the level needed to keep populations stable.
Main Impact
James Liang, a well-known businessman and demographer, says that a shrinking population threatens innovation. He points out that more people mean more minds working on new ideas, patents, and technologies. If populations keep falling, countries may lose their ability to stay ahead in science and industry. This warning comes as China's birth rate hits a record low, and many other Asian countries face similar declines. Liang's views put him at the center of a growing debate about how to balance economic growth with demographic change.
Key Details
What Happened
China's birth rate fell to 5.63 per 1,000 people in 2025, the lowest since 1949. The country's population is expected to drop below 1.25 billion by mid-century. Liang, who has long criticized China's former one-child policy, says this decline is a serious problem. He believes that without enough young people, the economy will struggle to innovate and grow.
Important Numbers and Facts
Many East Asian countries are now below the replacement rate of 2.1 children per woman. South Korea's fertility rate rose slightly from 0.72 in 2023 to 0.80 in 2025, but it is still very low. Japan, Taiwan, and Hong Kong are all "super-aged," meaning more than 20% of their populations are over 65. Even developing countries like Thailand, Vietnam, and India are seeing birth rates fall below replacement levels. Liang estimates that spending 1% of GDP on family policies only raises the fertility rate by 0.1. To raise it by one child, a country would need to spend about 10% of GDP.
Background and Context
Liang has been a vocal critic of China's one-child policy, which was in place from 1980 to 2015. The policy was replaced with a two-child limit in 2015 and then dropped entirely in 2021. But birth rates have continued to fall. Liang's "innovationism" philosophy argues that population size is directly linked to a country's ability to innovate. He says that more people mean more researchers, engineers, and inventors. Without enough young people, he warns, countries may lose control over their own technological future.
Public or Industry Reaction
Not all experts agree with Liang. A recent paper by economists Daron Acemoglu and David Autor found that lower birth rates can actually lead to higher GDP per working-age adult. They argue that companies invest in labor-saving technology when there are fewer young workers. Harvard economist Claudia Goldin points to the unequal distribution of household work as a key reason for falling birth rates. She says women often delay having children because men do not share enough of the childcare and housework. Liang agrees that men should take more responsibility, but he rejects the idea that women should leave the workforce.
What This Means Going Forward
Liang warns that AI could make the situation worse. He says that if AI replaces many jobs, young people may have even less money and stability to start families. On the other hand, AI could also free up time and resources if used wisely. But Liang's biggest fear is that a shrinking population will lead to more decision-making being handed over to AI. "We need more people, otherwise we'll just yield our control to AI," he said. Governments in Asia are trying different policies, from cash bonuses to dating events, but so far results have been small. Liang says much bigger investments are needed to make a real difference.
Final Take
James Liang's warning is clear: without more children, countries risk losing their edge in innovation. The debate over how to fix falling birth rates is far from settled, but the stakes are high. Whether through more government spending, better family policies, or changes in social norms, the challenge of demographic decline will shape the future of economies around the world.
Frequently Asked Questions
Why is China's birth rate falling?
China's birth rate is falling for several reasons, including the long-term effects of the one-child policy, high costs of raising children, and a competitive education system that makes young people delay starting families. Many couples also choose to have fewer children due to work pressures and financial concerns.
What is the replacement rate for population stability?
The replacement rate is 2.1 children per woman. This is the number needed to keep a population stable without relying on immigration. Most East Asian countries, including China, Japan, and South Korea, are well below this level.
Can government policies reverse falling birth rates?
Government policies like cash bonuses, childcare subsidies, and parental leave can help, but they often have only a small effect. James Liang says that spending about 10% of GDP on family policies could raise the fertility rate by one child, but this is a very large investment. So far, no country has found a simple solution to reverse the trend.
