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Demography is Destiny

Taiwan - shrinking and increasingly alone

Taiwan - shrinking and increasingly alone

by Marcus Roberts | September 05, 2018

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Once our three children are in bed (a process that can take some time, much to my frustration) I often relax by doing the dishes. And while doing the dishes, I sometimes listen to podcasts. This is easier to do now that we have a bluetooth speaker and I don't need to lean down towards my phone to hear it while keeping my arms in the sink. Anyway, that is all an introduction to the fact that I listened to a US think tank symposium (the Hudson Institute I think...) about US relations with Taiwan and the increasing Chinese pressure on the island nation.

(Hear that? Nation! Not a province - I will not bow down like Qantas and call it a mere Chinese province due to Chinese Communist pressure...If you never hear from me again, you'll know I've been dragged off to China to have my organs harvested.)

The podcast was interesting in its relatively pessimistic tone, the panelists thought things were coming to the point where the USA could do little to prevent China in the future pressuring Taiwan diplomatically, economically or indeed militarily. And that an attempt by China to reimpose the One China paradigm unilaterally should not be ruled out in the medium term.

With that in mind, demographic news about Taiwan's future is also looking bleak for the island nation. According to the Taipei Times, the population of Taiwan is going to start to decline in four years' time: 2022. This population decline will begin three years' ealier than was predicted only back in 2016 by the Taiwanese Government. This is largely due to Taiwanese people choosing to marry late and have fewer children. The 2016 total fertility rate of 1.17 children per woman dropped to 1.13 in 2017. The number of new births fell further this year - in the year to August, there were 5,800 fewer births than during the same seven month period the year before.

In 2021 the population is expected to peak at 23.61 million people and then start to decline. By 2060, some predict, the population may have dropped 30 per cent to about 15 million people. At the same time, the working age share of the population will shrink until it is smaller than the non-working aged population by 2027. Those working aged Taiwanese (15 to 65 year olds) will fall by 10 per cent by 2030 and perhaps by nearly 50 per cent by 2065. By 2034 50 per cent of the populaiton will be over the age of 50 (!) All this means, of course, that the Taiwanese economy will find it very hard to keep growing in the years ahead (and to support a decent defence force).

The government has committed to a target of keeping the population at no less than 20 million people with a fertility rate of 1.25 in 2022 and 1.4 in 2030 (still far below replacement of 2.1). But as with King Cnut, this may prove a job beyond them. Taiwan looks as if it is facing some extremely large challenges in the years ahead. Beijing will be watching with interest.

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