Sunday, January 20, 2008

Implications of China's Demographics

There are a lot of things about the future of China that need to be forecast, and forecasting is always an "iffy" business -- with China especially, but some phenomena are already known and forecasting is not required. Demographics is one. We know, already, how many people there are on the ground in China today [or, we have a pretty good guess]; and we can calculate, not forecast, how many that will make at each age group ten, and twenty, etc. years from now.This reduces some of the uncertainty involved with such projections, but also make for some sobering conversations.

In a recent post on the blog China Beat, UC Irvine professor Kenneth Pommeranz has a remarkably well-written, concise yet emphatic, discussion of what some of the implications of China's demographics means for urbanization and for the future of China's large US dollar holdings. This is well-worth reading, as it emphasizes the importance of both structural factors in development, and the burden of a large population. The implications for US-China relations, and the dollar are also big!

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