To allow mainland mothers to give birth to children in Hong Kong. There will be more babies and they can contribute to the society later on and in order to release the pressure of population ageing. To expand more programs to attract skilled or talented people to Hong Kong. Just like the Capital Investment Entrant Scheme (CIES), Chinese people can immigrate to Hong Kong and obtain Hong Kong Identity through this scheme. They are required to invest not less than HKD 6. 5 million in selected investments for not less than seven years.
Given the low birth rate problem, the most direct and obvious result of this is population ageing. When the number of new born babies declines continuously, the number of the retired will then far outweigh the number of young working force in a few decades. A further implication of that is the increased burden on the young working force due to the ageing population would rise the saving rate, in turn cutting the consumption and so impose a contracting effect on the economic development.
Impacts of low birth rate will not be only appear a few decades later, but also appear when the rate starts to decline. Starting from the rapid birth decline during the 1970s to 1990s, in the short run, it benefits a lot the economy. The reason is that the numbers in the work force had grown much more rapidly than the population as a whole and also there are fewer little dependents (i. e. children). It thus led to a more rapid economic growth.
When there is a better life quality, the birth rate will further decline. When time goes by, population ageing starts, the decreasing birth rate will cause the aged work force. An older work force could lead to labor shortages, and with fewer younger workers, pension system contributions may not be able to cover the rising costs for health and elderly care. The welfare burden may force governments to raise taxes and families to reduce savings, which will further pinch the economic growth.