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12th Five Year Plan (2011-15) National Strategic Emerging Industries

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Is Malthus' new ghost another false alarm?

The latest UN population report "2010 Revision of World Population Prospects" issued on 3 May, 2011 suggests that "the current world population of close to 7 billion is projected  to reach 10.1 billion in the next ninety years, reaching 9.3 billion by the middle of this century." "Much of this increase is projected to come from the high-fertility countries, which comprise 39 countries in Africa, nine in Asia, six in Oceania and four in Latin America". Download United Nation's Population Report 3 May 2011

Neverheless, the UN report warns that "Small variations in fertility can produce major differences in the size of populations over the long run. The high projection variant, whose fertility is just half a child above that in the medium variant, produces a world population of 10.6 billion in 2050 and 15.8
billion in 2100. The low variant, whose fertility remains half a child below that of the medium, produces a population that reaches 8.1 billion in 2050 and declines towards the second half of this century to reach 6.2 billion in 2100. For long-term trends the medium variant is taken as reference".

But according to a Spiegel Online International article dated 3 November 2011, "birth rates are actually in free fall worldwide. Experts predict that the world's population will start shrinking in 2060 and that - with a bit of imaginative policymaking - the birth and death rates could actually balance out". Click here

Even if this less alarmist equilibrium may eventually come true, the challange is what would happen during the trajectory as exploding populations and urbanization in much of the developing world threaten to  push the world's resources and ecology to a tipping point and beyond.

Neverthless, the Spiegel Online article tells an interesting other side of the story. "To a certain extent, the fears are justified. The global population will continue to grow for decades. "But," says Wolfgang Lutz, "that shouldn't distract us from the fact that an entirely different development has been underway for some time."

"Lutz is the director of the Vienna-based International Institute for Applied System Analysis (IIASA) and one of the world's most prominent demographers. As he sees it, it is "highly probable that mankind will begin to shrink by 2060 or 2070."

"The demographics of the poorest countries are still shaped by population growth, which is supported by three factors: First, life expectancy is on the rise, increasing statistically by three months each year. Second, child mortality is declining. And, finally, the children produced by the population boom are now reaching reproductive age".

"But how many children does the average woman in this boom generation give birth to? Indeed, it is this number that will shape the long-term future -- and, in most countries, it is in free fall. In 1950, the average was five children per woman, a number that has since declined by half, to 2.5. This is alarmingly close to the so-called replacement fertility rate of about 2.1 children per woman, the value at which the size of a population remains constant."

"In China, the one-child policy has caused the birth rate to plunge even more rapidly. Even in Shanghai, a city of 23 million, couples are not taking advantage of new rules that allow them to have two children. Statistically speaking, Chinese women here are having only 0.6 children, which is the lowest rate among all major Asian cities. "From a population standpoint," Lutz predicts, "China will begin to stagnate in 10 to 20 years."

"Only Pakistan, Afghanistan and the countries in sub-Saharan Africa are still reporting significantly higher birth rates. Niger leads the pack with a particularly impressive rate of seven children per woman. Indeed, by the end of the century, Africa is expected to be home to more than 2 billion people. But the demographic pendulum is shifting even there, as women begin to have fewer children".

This factual reality is a function of the followiung dynamics

(a) China (a fifth of mankind) is getting old before it gets rich, with rapidly declining birth rates under a One Child Policy;

(b) In other parts of the developing world where populations are increasing, better education and living standards are translating into a desire for qualilty rather than quantity in the number of children to be raised. "Economics is the best contraceptive", according to a famous quote.

(c) All over most of the western world, populations are on a long-term declining trend, although there is increasing awareness that a balance needs to be struck between work and raising children.

"At some point in the next century, (Lutz) says, the world population could stabilize at a level of about 6 billion people. "That would put us within a range that environmentalists view as tolerable for our planet," he says."

"Lutz admits that it will require some imagination when it comes to policymaking. But he also thinks that "people aren't just mouths to feed. They also have brains that can find new solutions."

"RMB Cross-Border Settlement: Origins, Mechanics, and Opportunities"

A BBVA research report dated 9 March 2011

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