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China will see its first inhabitants decline in a long time

A weekly recap of the stories to watch in China this week, plus an exclusive analysis written by senior foreign policy editor and former Beijing correspondent James Palmer. Delivery on Wednesday.

April 28, 2021, 6:59 p.m.

Welcome to the China Foreign Policy Letter.

This week's highlights: Beijing's 2020 census data is expected to be a Population decline, Director Chloé Zhao's Oscar victory was not mentioned in the Chinese press, and Jack Ma is under fire again.

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China is expected to see its first population decline since Mao Zedong's big leap forward in its recent census, which could spark a moment of crisis in a country deeply concerned about its aging demographics. After the one-child policy was officially lifted in 2015, the government hoped a baby boom would follow, but the numbers show that it hasn't – because it's simply too expensive to have children in China.

Censuses in communist countries have always been politically sensitive as they often speak of failed policies or hidden disasters. Chinese officials have already delayed the release of the 2020 data – and they may be buried later, either not published or not covered by the media. China recorded more than 1.4 billion people in 2019, and a decline below that number will bring a significant moment closer: when India, with 1.38 billion people, officially becomes the largest country in the world.

The declining numbers have nothing to do with COVID-19 deaths. For the coronavirus to affect the Chinese population, the official death toll – 4,636 – would have to be hundreds of times higher. Although researchers say the real number could be five to ten times higher, deaths would have occurred exponentially on social media or mortality data. (Chinese censorship is strong, but not all-powerful, as documenting state abuses in Xinjiang has shown.)

However, it is possible that the effects of the pandemic last year made people in China even more risk averse to having children.

The population decline essentially reflects a simple reality, aside from a pandemic: having children in China is expensive and stressful, as is the case in most developed economies. At the end of the one-child insurance period, the financial and social costs of raising children kept urban middle-class families from having more – no rules for family planning. (A recently released video game showed just how much is involved in modern Chinese parenting.)

In addition, many Chinese face the responsibility to look after aging parents, especially a generation of only children, as well as the stigma of single parents. For the poor, the stress of child separation due to labor migration, the difficulty of finding education or health care in large cities, and the inability to buy housing – often a social requirement before marriage – are other barriers.

China is not a developed economy, which is why the low birth rate is an even greater burden than for countries like Japan or Italy. Despite China's huge economy, per capita income is still below the global average, compounding the problem of supporting a graying population with a shrinking workforce. China's growth model is still work-driven and, unlike European countries or the United States, has no immigration flow to counteract the loss of fertility. The ethno-nationalist turn under President Xi Jinping makes it unlikely that there will ever be one.

The Chinese authorities are also focusing on what is known as human quality: they want women with college degrees, not farmers, to have babies. Pressure on women to abandon their careers in favor of parenting has increased, along with much feminist opposition. The shock of the new population is likely to result in a leap towards more natalistic politics. On the positive side, this could mean more public funding for health care, child welfare and education.

But the Chinese state's machinery is currently turning to repression rather than reform, and negative measures like abortion restrictions and the displacement of women from work may be more likely. After all, Beijing has spent decades claiming authority over the reproduction of women and there is a huge family planning bureaucracy out there to do.

Oscar winner censored. Chloé Zhao, the Beijing-born director of Nomadland, won an Oscar on Sunday in a Breakthrough for Asian Women in Hollywood. However, this is not mentioned in the Chinese press. Zhao has been a persona non grata since she gave an interview in 2013 criticizing China's policies and calling it "a country where lies are everywhere".

It is not the first time Beijing has thrown away a potential soft-power moment in favor of oppression. Gao Xingjian's 2000 Nobel Prize for Literature has been removed from official memory. In the state media, Mo Yan's 2012 victory is often referred to as China's first. Zhao's outspoken politics come despite her family being among the ultra-rich in China: her father was a steel company boss and a major real estate developer, and her stepmother is Song Dandan, a famous comic book actor.

Xi on tour. Xi is conducting a tour of southern Guangxi Province with a focus on security and development of the border areas in minority areas. The state regards China's southern minorities as more assimilated and therefore less threatening than Uyghurs or Tibetans, not least because they generally lack national ambitions of their own.

According to Bill Bishop's translation, Xi's speech during the tour of the Xiangjiang River, which was the scene of a critical struggle during the long march, was very political. Expect more of this rhetoric ahead of the Chinese Communist Party's (CCP) centenary celebrations in July.

Another debacle in Australia. The ongoing war of words between Canberra and Beijing took an ugly turn this week when the Chinese Foreign Ministry labeled Australia "sick" for tearing up agreements on the Belt and Road Initiative. Australian officials have warned of a possible war over Taiwan, an issue that some US commentators reiterate. This seems very premature: China's saber-rattling over Taiwan is aggressive, but far from an actual invasion – which would be signaled well in advance.

Meanwhile, Jane Golley, a prominent Australian academic, is embroiled in controversy after approving an anonymous, unpublished, and unreviewed paper attempting to defend China's atrocities in Xinjiang and attacking Western scholars. I've seen the newspaper: it's sloppy work that appears to have been produced as part of China's concerted propaganda campaign.

The discipline of Chinese studies in Australia has become politically heated as the country overhauled its relationship with Beijing. A similar phenomenon is already occurring in the United States.

Jack Ma is still in the spotlight. The Chinese authorities are investigating how the Ant Group's proposed IPO was swiftly approved last year. This is a sign that the state's humiliation of tech billionaire and Alibaba co-founder Jack Ma is still ongoing. Ma has been facing a concerted campaign since the IPO was blocked at the last minute, part of a broader crackdown on tech companies.

It is possible that this latest move is intended to completely destroy Ma, perhaps by collecting bribes against him. If so, the politicized overthrow of a man who was once hailed as a national champion would be a sharp reminder of how little space the CCP is willing to give anyone in China today. The destruction of the Alibaba empire could result in it being distributed to members of the political elite behind the scenes.

Oracle plays defense. The Intercept reports that the US software giant Oracle was heavily involved in surveillance work in China, where it was heavily marketed to police and security departments, even when the state's racist surveillance of Uyghurs and other minorities is scrutinized. Ken Glueck, executive vice president of Oracle, responded to the report with an extensive blog post in which he asked for "information about Mara (Hvistendahl, the Intercept reporter)". Finding individual reporters is a common tactic for Chinese firms, but an unusual choice for an American company.

Tourists walk on a platform in Dali City, China on April 25.Kevin Frayer / Getty Images

Dali, Yunnan: 652,000 people

By Chinese standards, the city of Dali is basically a village. Dali is located in the highlands of Yunnan, a southern province known for its food and diverse ethnic groups. It's a quaint, slow-moving city that's been popular with both Western and Chinese hipsters and hippies since the 1980s.

Yunnan was not conquered by Chinese empires until the 1380s, although the Han Empire established military outposts there and Dali was the capital of one of the region's many powers, the eponymous kingdom of Dali, a mountainous Buddhist state.

Today Dali is a famous tourist destination with a thriving arts scene. Most of the locals are Bai, a heavily Sinized minority, but the feeling of Bai identity is largely a show for visitors. The city offers a rare combination of natural beauty, particularly the stunning Erhai Lake, and preserved historical buildings. Dali disappearing to life is a bit like moving to Portland, Oregon: it's what someone would do when burned out in the world and wanted to hang out with pleasant eccentrics.

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