During the 14th five-year plan period (2021-2025) large numbers of Chinese citizens born over the decade from 1963 will move into retirement. Though China has been accounting for not just economic but also this underlying demographic change for decades, its preparation may still be insufficient. Ageing-induced slower growth in China not only risks hundreds of millions of poorer older livelihoods in China, but slower growth worldwide. Famous for planning, what are China’s ageing planners now up to that intensifying ageing is a reality?

The answer appears to be pushing the growth opportunities of the ‘silver economy’ – any new areas arising from or useful within a context of population ageing. A simplified lifespan concept used in a speech last week by Yang Yansui, director of Tsinghua University’s medical service governance research centre is useful for elaborating China’s emerging thinking. Using a typically Chinese enumeration-based concept, Professor Yang described understanding of an assumed hundred-year life as “50 years of black hair and 50 years of silver hair”.

The idea of a ‘black hair’ half century focuses on the first 50 years of a targeted 100-year life. In this period, after an initial, and in China’s case ever-deeper, human capital accumulation, comes a first and intensive career era, that across generations involves an increasingly innovative application of human capital.

Since implementing a one child policy in 1980 China in fact has been aware its population would age while still a developing country, a challenge known as ‘getting old before getting rich’. It has, hence, for decades sought to ensure its smaller younger cohorts, those along China’s richer coast in particular, are significantly more educated than their parents. In turn, in theory they have the potential to continue pushing out the productivity frontier in the face of adverse per capita productivity pressures in a rapid population ageing context. This is the hope for China’s economy now. Indeed, in 2021, China’s coastal economic frontier of Guangdong, is reported to be opening 11 new universities – the sort of places that China’s new educated elite can push forward the technology frontier.

For the ‘silver haired’ fifty years, staying abreast of technology and serving indirectly to support it, are imperative. Hence, “It is necessary to further provide elderly care services that are real-time, fast, efficient, and low-cost at the same time with the characteristics of interconnection and intelligence”, Chinese media reports Jiang Rui, deputy director of the Shanghai Municipal Civil Affairs Bureau as saying this month. His comments follow the State Council’s November issue of the “Implementation Plan on Effectively Solving the Difficulties of the Elderly in Using Intelligent Technology”, focusing on the elderly to travel and seek medical treatment, and the recent launch by Beijing of the “Elderly People’s Health Care Platform”.

The aim is a win-win that means China’s rising “silver-haired” population share don’t interrupt the flow of progress. The latter would see population ageing ‘ageing’ the economy – counterproductive for all generations (In a corollary to the Malthusian Trap, this has been called the Johnston Trap).

More directly, the second fifty years of an intended century-long life, the ‘silver-haired’ period, is where a person’s economic contribution is expected, on average, to be relatively passive. In this period a “health-wealth” approach refers both to personal wealth and social wealth. Healthiness and active social participation help to drive up consumption and build upon the more frontier-pushing productive work of the ‘black haired’ population share.

To this point, China is also pushing new frontiers in financial reforms, including of the insurance industry, both life and medical, and also of China’s pensions sector. The door, that is, is relatively newly widely open to investors and advisers able to reap new dividends for China’s pensions funds, and hence help to ensure China’s related social funds don’t run dry amid rising payout pressures. At the consumer level, Chinese companies are responding also. E-commerce giant Alibaba, for example, has recently launched ‘Taobao for Elders’, which offers a simplified functionality. JD.com has also launched a number of training initiatives to ensure that older citizens are comfortable making payments and performing other tasks online.

The fifty-year black hair and fifty-year silver hair life offers a useful and important simplification within the long-run and clear-sighted agenda to make sure that population ageing does not derail the economy – to adverse end for all generations. Policy makers everywhere, even in young countries, would do well to equivalently seek to turn the flow of silver, at home and abroad, into a flow of gold.