China's shrinking population a worry for global economy

Shortage of labour, dip in spending by people likely to impact world 

- NICOLE HONG

DESPITE THE ROLLBACK of China's one-child policy, and even after more recent incentives urging families to have more children, China's population is steadily shrinking a momentous shift that will soon leave India as the world's most populous nation and have broad rippling effects both domestically and globally.

The change puts China on the same course of both aging and shrinking as many of its neighbours in Asia, but its path will have outsize effects not just on the regional economy, but on the world at large as well.

Here's why economists and others are alarmed by the developments.

For years, China's massive working-age population powered the global economic engine, supplying the factory workers whose cheap labor produced goods that were exported around the world.