VIETNAM HOPES THIRD, FOURTH CHILD WILL BE THE ECONOMIC CHARM
Ending two-child policy could boost birthrate and spending
ATSUSHI TOMIYAMA, Nikkei staff writer
Most families in Vietnam have two children.
HANOI
-- The Vietnamese government is expected to end its de facto two-child
policy by the end of the year amid a population that is aging faster
than expected.
For the past 29 years, the government has
encouraged families to have no more than two children. Even though the
limitation was never as strict as China's, most couples have only two
offspring.
Earlier this month, however, the country's
health ministry began showing a negative view toward the rule when it
said couples should be able to decide how many children they want. The
country's justice ministry later expressed support for the change. The
government is now expected to officially eliminate the policy in 2017.
The
move is expected to boost child-related consumption, especially among
middle-class and wealthy citizens. Consumer spending accounts for 70% of
the country's gross domestic product. Increased spending could help the
country's economy grow at a faster pace.
Vietnam is
also hoping that grandparents will stimulate consumption, as the elderly
tend to have higher savings rates than younger generations.
There
are no punitive measures for violation. But a total of some 20 million
citizens in the public sector -- including the 4.5 million members of
the Communist Party, as well as government officials and employees of
state-owned enterprises -- have been prone to indirect penalties, such
as not getting promotions or being relegated to lower-status jobs in
smaller cities.
More than 20 years ago, Nguyen Dang
Vinh, a 59-year colonel in the Vietnam People's Air Force, and his wife
had two daughters but they wanted a boy too. The year their third child
was born, the colonel did not get promoted. He did not even receive the
typical annual salary increase that year.
If the new
system encourages families to have more children, it will stimulate
consumer spending and the economy. Greater spending on children has an
impact on several sectors, from food to toys to education, and
indirectly, the housing, automotive and insurance industries.
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