New Delhi, Aug 17: China is projected to face significant economic challenges in the coming decades as its ageing population and mounting government debt weigh heavily on growth prospects, according to reports.
High debt levels increase interest costs and reduce fiscal flexibility, while an ageing society drives up pension and healthcare expenses. These combined pressures could severely limit Beijing’s ability to respond to future shocks, a Newsweek report noted.
The International Monetary Fund (IMF) ranks both the U.S. and China among the world’s most indebted nations. While U.S. gross debt stands at 123 percent of GDP, China’s debt is estimated at 84 percent—largely fueled by debt-driven growth during the 2010s and the ongoing housing market crisis, which has left local governments heavily burdened.
Oxford Economics projects that China’s potential growth could shrink to nearly half its current pace by the 2050s. Demographics remain a major concern: China’s median age, currently around 40, is expected to climb to 52 by 2050—well above the U.S. median age, projected to remain near 41.
The country’s old-age dependency ratio is also set to soar, rising by more than 50 percentage points by 2026 compared to 2010, far higher than the 8–10 point increase expected in the United States. With one of the world’s lowest fertility rates—just 1.2 births per woman—China faces the challenge of a shrinking workforce supporting a growing elderly population.
In contrast, the U.S., despite a below-replacement fertility rate of 1.6, has historically offset demographic pressures through immigration. Economist Jed Cartledge of Oxford Economics said immigration would remain a demographic advantage for the U.S., though current declines under the second Trump presidency are expected to be temporary.
