Singapore suffers dwindling birthrate

Deseret Morning News business writer Dave Anderton is one of six journalists participating in the Asia Pacific Journalism Fellowship program sponsored by the Hawaii-based East-West Center, the Singapore International Foundation and the Chinese International Economic Cooperation Association of Taipei.

SINGAPORE — One of the world's most competitive economies doesn't have an answer for what is fast becoming one of its biggest problems.

Singapore's falling fertility rates could spell disaster for this island city-state, which counts human capital as its top resource.

In 2003, Singapore's fertility rate fell to 1.26, the lowest in the nation's 39-year history and much lower than Utah's rate of 2.68. With fewer than 38,000 babies born last year, the Singapore government is scrambling to find incentives to increase the population.

"It's a big problem," Deputy Prime Minister Lee Hsien Loong told the Deseret Morning News on Tuesday. "People are marrying later."

The pending crisis threatens to introduce chronic labor shortages, higher taxes, shrinking numbers of consumers and a graying population left unsupported by a younger work force.

And immigration, Lee said, will not solve the problem.

"You are looking eventually at a shrinking population," Lee said. "With an aging population you lose vitality and drive. You are no longer looking for tomorrow, you're preoccupied with the benefits today."

Singapore did not always face such a problem. In the 1960s and 1970s, the nation's birth rate was roughly 6 children per woman. Back then, the government launched a campaign to limit population growth to two children per family, hoping to prevent overcrowding and the costs associated with educating and housing a burgeoning population.

The campaign worked a little too well.

"Unfortunately, when we said stop at two, people didn't stop at two," Lee said. "They went down below two."

Now Singapore's Parliament is debating whether to dish out baby bonuses. Some have suggested cash incentives of up to $6,000 for a woman who has a second child and $12,000 for a third.

There is even talk by some of starting economic disincentives.

"In other words, a higher tax rate if you don't get married, a higher tax rate if you don't have children," said Margaret Thomas, associate editor of Today, a daily newspaper in Singapore. "Try as they will to incentivize people one way or another, it can only have a certain impact. It's not going to be the solution."

Ng Koon Ling, a mother of two, agrees money is not the solution.