China’s Decision To Scrap The ‘One Child’ Policy Is Already Having Unusual Effects On Its Economy

Last week, China ended its one-child policy, allowing couples to have two children for the first time since the population control programme was implemented more than three decades ago. One of the world’s most populous countries, China has nearly 1.4 billion inhabitants, with a staggering 16.5 million births each year. Xinhua, China’s state-run news agency, announced the news via Twitter with a short statement from the Communist Party:

China to allow all couples to have two kids, ending one-child policy: CPC commuique https://t.co/KLYPWfpJ6u pic.twitter.com/9Wt2MLiY5S

— China Xinhua News (@XHNews) October 29, 2015

While the move was well received by the public and international media, not everyone is delighted by the latest development in the Communist country. While shares of companies producing nappies, buggies and baby formula have all seen a spike – contraception and especially condom manufacturers saw a dip in shares following the news last week. One of the biggest losers from the announcement was Japanese condom maker Okamoto Industries Inc., slumping 10 per cent in its share value. According to The Independent, analysts at investment bank Credit Suisse estimated that the relaxed policy to childbirth would result in an extra 3 – 6 million babies born annually in a five year period starting from 2017. Although the only saving grace for condom makers might be the cost of actually having a second child, with authorities warning parents to account for the expense of raising a second child.