The mainland and many other parts of the world may be battling a big problem, the problem of booming population. But China's Special Administrative Region of Hong Kong faces a problem of a different kind: one of the lowest birth rates in the world.

The reasons for Hong Kong's problem, just like the mainland's, are varied: the high cost of bringing up a child, the elaborate pre-birth planning and young women's preference of career over family.

A woman should have an average of 2.1 children to ensure the population to remain stable. Shockingly, the city's average of 0.92 is nowhere near that.

Till recently, women without children were called "childless". Nowadays, a growing number of them in the West are insisting on the term "childfree", the emphasis being on liberation rather than a sense of loss. They reject the job description that "comes with parenting" - loss of freedom, reduced career prospects and financial burden.

Many women in Hong Kong agree.

Susan Fu is one of them. Thirty-year-old Fu is a civil servant and has been married for five years. Her husband works for the Hospital Authority and they earn enough to raise a child, but still motherhood for her could wait.

They are one of many couples in Hong Kong that don't want a child to "interfere" with their life. Fu spends about 10 hours of a normal day at work, and at times works on the night shift. Even on her day-off, she is seen helping colleagues or organizing something or the other. Her husband always needs to work overtime and surfs the Internet for information related to his job even while he is at home.

In Hong Kong, many parents save money for their children's university education. Some even shift home to other districts just to see their children get admission to good schools.

"We want to build our career. Having a baby is a huge responsibility and it will affect our lifestyle," Fu says. "A child is a heavy burden because parents have to worry about everything it does or is supposed to do, especially its education... I don't want to sacrifice my life for a child. I just want to spend my time the way I want."

Fu knows it's more difficult for women in their late thirties to conceive for the first time or give a problem-free birth. But this would not convince her to have a baby now.

Neither would the declining birth rate's impact on Hong Kong's economy make a difference. "The impact on the economy is big social issues. I can't do much to solve that," she says.

Hong Kong's birth rate has been falling over the past decades. About 86,800 babies were born in 1981. The figure dropped to 68,600 in 1995. Five years later, it had dropped to 54,100, though it increased slightly, to 57,300 in 2005.

What's the reason for that? Experts say (higher) education and change in family values have pushed people, especially women, to believe a "quality life" is possible even without a child.

Many would think that the influx of people, especially from across the border, into Hong Kong would more than make up for its falling birth rate. They couldn't have been more wrong, for the number of mainlanders entering the city with a one-way permit is dropping drastically too - from 50,300 in 2003 to 34,000 in 2004.

The economic impact

The low birth rate has been worrying the government, which is studying options to tackle the problem. Early last year, Chief Executive Donald Tsang, when he was still the chief secretary for administration, had urged couples to have at least three children. The government is now planning to even make kindergarten education free so that couples won't think of a child as a financial burden.

University of Hong Kong (HKU) senior lecturer in statistics and actuarial science Paul Yip, who is part of a government study on the population problem, warns that the economic impact of the low birth rate will be felt more deeply in the next five to 10 years. The city has already seen about 30 primary schools close down in September because they didn't have even 23 pupils in the primary one class.

Industries targeting would-be mothers and children too might be forced to change their strategy, or suffer.

Mother World, a chain of stores selling clothes for would-be mothers and children, has been struggling in recent years. Director Choi Tak-tim says the toughest time was from 1998 to 2000 when merely reducing prices was meaningless because there was simply no demand.

"In the past, children's clothes were the most popular items in our shop... Given that an average family used to have two children, it was an attractive business," he says. "But no more."

The toy industry too needs to look towards the mainland and overseas markets. Educational toy designer Kimmy Lau now feels the local market for his product is no longer big enough. Lau feels the mainland and certain overseas markets are developing, where more and more parents are willing to spend on toys.

Professor of decision sciences and managerial economics in Chinese University of Hong Kong Fung Ka-yiu says the consumers' market, especially those selling electronic products, will perhaps be dealt the worst blow. "The consumers' industry is targeted mainly at youngsters... Youngsters like to buy mobile phones, MP3 players and other gadgets even if they don't have a high income. The demand for these products will drop as the number of youths keep falling," he says.

Another problem that Hong Kong faces is "brain drain" because on the whole, people coming to the city have lower qualification than those leaving it, according to the 2003 government population report. Only 30 per cent of the 173,212 people aged 15 or above who entered the city with a one-way permit in 2001 had completed senior secondary level or higher education, while most of the 10,500 emigrants in 2002 were well-educated professionals.

This will make Hong Kong's creative, arts and entertainment industries suffer and affect innovative business strategies and overseas investment, the academics say.

Who'll foot the medical bills?

A low birth rate also means a disproportionately high ageing population. The Census and Statistics Department says the percentage of people aged 65 or above will rise from 11.7 (of 6.8 million) in 2003 to 27 (of 8.3 million) in 2033.

Yip says: "It may be difficult for Hong Kong to position itself as Asia's world city if it has more elderly people than youths."

The low birth rate is also one among several reasons affecting the property sector. Last year, only 17,320 flats were completed, 33 per cent less than in 2004. What's worse, property sector representatives fear the demand for new flats would fall further, thanks to the changing demographic pattern. Among the changes could be younger people spending more to take care of the elderly, meaning a jump in Hong Kong's medical bills.

The estimated elderly dependency rate (the number of elderly aged 65 or above in every 1,000 people aged between 15 to 64) will increase from 161 in 2002 to 428 in 2033, and the median age of the population will rise from 38 to 49.

A Census and Statistics Department study in 2004 showed that 52.8 per cent of the 985,700 senior citizens living with their families were actually aged 70 or above. And about 71.6 per cent of these 985,700 elderly persons were suffering from chronic diseases, with 14.6 per cent of them needing in-patient hospital care in the past year.

It's scary to think, as the Health, Welfare and Food Bureau says, that HK$50 out of every HK$100 tax collected will be spent on medical expenses if the funding method is not changed and the population continue to age.

Hong Kong's medical bill has reached HK$30.2 billion, or 14.4 per cent of the recurrent public expenditure - that is, HK$22 out of every HK$100 tax collected.

That is a heavy burden on the tax system, says CUHK's Fung. "We have fewer youths, the productivity force, and more elderly who depend on medical help. Who is going to foot that bill? We can't ask the elderly because they don't have any income to pay tax. This is a serious problem for the government treasury."

HKU's Yip says Hong Kong needs to encourage couples to have more children and attract more talented people from abroad. And for that Hong Kong needs to build a harmonious society and tackle air pollution.

The city could learn from other low birth rate economies, such as Japan and Singapore, to encourage people to have more children. In Singapore, the first-born of a family is eligible for a S$3,000 (HK$14,402) bonus, and the second child can get S$9,000 (HK$43,212). And maternity leave has been extended from eight to 12 weeks.

Incentives are fine. But the government has also to make couples feel the longing for a child, say the academics.

(HK Edition 04/06/2006 page4)