Raising children is the most expensive in North Korea and China
Raising children is a costly endeavor in all parts of the world. As CNN reports, citing a study by US investment bank Jefferies, the most expensive countries to raise children are North Korea and China. Although China is one of the cheapest countries to have children in terms of absolute expenditure, this should be classified in relative terms. “If we convert this data to a percentage of median disposable income, China becomes the most expensive place to raise children,” the researchers said. Up to the age of 18 it costs US$75,000 to raise a child in China. It costs another 22,000 US dollars to send your child to a university.
That’s why raising children is so expensive in the Middle East
The reason that raising children in the Middle East is so expensive is the cost of education and the cost and availability of childcare for young children. All in all, the tuition fees in China are a lot lower than in the USA, for example, but in many western countries there is the possibility that parents can be relieved by student loans, for example.
The high cost of raising a child also means that Chinese couples are often reluctant to have a child. “As China’s economy develops, there is a good chance that the country will fall into the demographic-economic paradox, like many other industrialized countries, and the birth rate could fall to a lower level than many had expected,” the Jefferies analysts explain. As Reuters also explains, experts warn that “China’s aging population will put enormous pressure on the country’s health and social security system, while a shrinking labor force could also severely limit growth in the world’s second largest economy in the coming decades.”
How can the government make raising children easier?
In general, the government has some options that could reduce the cost burden of raising children. For example, Beijing has already begun to facilitate access to after-school tutoring. A cost reduction for crèches and kindergartens could also be helpful. “We assume that the government is looking to either have these services provided by the state and/or regulate the prices of private services,” the researchers said, according to CNBC. In addition, the Chinese government states in its five-year plan that it intends to increase the number of kindergarten places for children under the age of three to 4.5 per 1,000 inhabitants by 2025. The number is currently just 1.8 per 1,000 inhabitants. According to Reuters, China would need to spend 5 percent of its annual GDP to encourage couples to have more children. These include, for example, educational subsidies, reduced mortgage rates, tax breaks, equal paternity and maternity leave and building more childcare facilities.
E. Schmal / Editor finanzen.net
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