Editorial Notes

Tackling Thailand's declining birth rate, the Greek crisis and spiraling Olympic costs in Tokyo

Editorial Notes is a selection of editorials from newspapers in the Asia News Network (ANN).

1. Thai tax scheme alone can't spur the birth rate

The Nation/ANN

A newborn baby. PHOTO: ST FILE

Parents will need more comprehensive assistance from the govt to counter the adverse effects of a greying society

The more children you have, the more likely you'll be poor: That was the grim slogan of a national birth-control campaign more than four decades ago. It was dire, but it was also accurate, and it remains accurate today. In the years since, the cost of rearing, educating and keeping a child healthy has steadily risen. It's the embarrassing, albeit practical, reason why many married couples forego parenthood.

The result is that Thailand, like many other countries, has witnessed a sharp drop in the birth rate, and thus the proportion of seniors in its population is swelling. We are rapidly turning into an aged society. By 2030 one in four citizens will be 60 or above.

We can take pride in successfully slowing population growth in an overcrowded world - from more than a million births a year to 760,000 as of 2010, projected to fall below 700,000 within two decades - but we've never effectively addressed the consequences of that drastic reduction.

Warranting a measure of optimism is the Finance Ministry's proposed tax adjustments to encourage parents to have babies. The Revenue Department plans to increase the tax allowance for children starting in 2017 as a way of offsetting current demographic shifts. It is too early to say whether the notion will alter the situation, but the fact that the government has begun looking for solutions is an encouraging sign.

As it stands, the personal-tax structure - like many other policies instituted during the baby-boom years - offers parents no genuine benefit. 

The tax allowance of Bt15,000 (S$597.41) to Bt17,000 a year for children is a drop in the ocean compared to costs, and it has remained unchanged for years. 

The Revenue Department is mulling the idea of doubling that to Bt30,000, surely a boon to struggling households but still a long way from covering actual expenses. And, again, there is no guarantee the move would help increase the birth rate.

Another measure being considered is extending the tax allowance to cover any number of children. Currently the maximum allowance is for three children. The idea is, again, to encourage couples to have more children, but it's unrealistic given that the average family had just 1.6 per offspring in 2012, and that figure has been declining since. Few couples today want to have more than three children. 

You have to go back 40 or 50 years to find Thai families averaging six children. 

So this concept is highly unlikely to have an impact.

Most urban couples in particular these days are sticking to one child, since even the expenditures facing a single-child family represent a daunting burden. The government must come up with fresh, comprehensive plans to support parents, beginning - as is surely obvious - in the areas of education and healthcare. 

It must keep in mind the quality of family life rather than just measuring need in quantity. This is the long-term future of the country we are dealing with, and tax adjustments, however well- intended and marginally helpful, are an inadequate response to an increasingly urgent problem. 

2. China's valuable support for a strong eurozone

China Daily/ANN

A pro-Euro protestor during a rally in front of the parliament building in Athens, Greece.  PHOTO: REUTERS

Knotty as it is, the unfolding Greek debt crisis is by no means unsolvable as long as confidence in a united and prosperous European Union and strong euro can prevail.

This is a key message visiting Chinese Premier Li Keqiang delivered to top EU leaders in Brussels on Monday.

At a crucial moment when pessimism has brought the Greek crisis to such a head that the country is closer to a default on its debt repayments than ever, Li offered a spark of enthusiasm to restart the stalled talks by calling on Greece and its creditors to reach a last-minute deal that will allow Greece to remain in the eurozone.

Given the escalation of the country's crisis over the weekend sent a shock wave through the global stock markets on Monday, there are ample reasons to worry about the uncertainties surrounding the events in Greece and the effect a default would have on Europe, relations between China and the EU, global financial stability and the nascent global economic recovery.

Greece has announced that it will hold a referendum on a bailout plan proposed last week by the country's creditors. In response, Greece's eurozone partners have refused to extend the country's bailout program and the European Central Bank capped its emergency support for the country's banks. A real danger now looms of Greece exiting the euro, which might derail the global economic recovery and damage the long-term viability of the euro as a currency.

However, such a tragedy is neither certain nor unavoidable.

The EU should shoulder its responsibility to prevent the Greek crisis from overshadowing the fragile global recovery.

As a major customer and supplier of the 28-nation EU, and a responsible long-term holder of Eurobonds, China's confidence in and commitment to a strong eurozone offers EU leaders the necessary support to look at the Greek crisis from a broader and longer perspective.

When Li said that China will not only consider a China-EU investment platform to back European Commission President Jean-Claude Juncker's plan to revive the European economy, but also buy more bonds issued by the European Investment Bank, EU leaders should be clear that China wants to see the EU maintain its integrity and a forward trajectory.

Such a confidence-building effort is particularly valuable, especially from such a large country as China which already has a huge stake and seeks to further expand it in a strong eurozone. It will be a tragedy to allow inaction over the Greek crisis to stand in the way of growth-boosting Sino-EU cooperation.

3. Conduct thorough review to control costs of building new Olympic stadium

The Yomiuri Shimbun/ANN

Photographers take pictures during the meeting of the Tokyo 2020 additional event programme panel in Tokyo on June 22, 2015. PHOTO: AFP

Can the idea of injecting a sum as huge as ¥252 billion ($2.76 billion) into the construction of a stadium ever win public understanding?

Education, Culture, Sports, Science and Technology Minister Hakubun Shimomura unveiled Monday a reworked plan for the construction project for the new National Stadium, the main venue for the 2020 Tokyo Olympic and Paralympic Games.

Under the reworked plan, construction of the new stadium is expected to cost about ¥90 billion more than the original ¥162.5 billion estimate that was based on the basic design proposal.

The new stadium is scheduled to be complete in May 2019, four months before the opening of the 2019 Rugby World Cup in Japan.

Its special structure, with a retractable roof supported by two gigantic arches, is said to be a prime factor inflating the construction costs of the stadium. But the reworked plan has stopped short of altering the costly structure.

Due to construction schedules, installation of the retractable roof is to be postponed until after the Olympic Games are over in 2020. We are stunned by the fact that, even when the installation cost of the roof is excluded, the construction of the new stadium will cost so much. Were there any options of calling off the special structure itself, using the massive arches?

Prominent architects in Japan had presented an alternative construction plan to reduce the overall costs and achieve completion in time for the rugby competition.
Shimomura said, “There is no reason to rule out the possibility that the stadium could be constructed in time [with the alternative plan].” If so, he must decide on making a drastic review.

Bad precedent

Yoshiro Mori, chairman of the organizing committee for the 2020 Tokyo Olympics, emphasized that the innovative design of the stadium had received “a high evaluation and expectations” from the International Olympic Committee (IOC). By saying this, he showed his stance of sticking to the idea of constructing the stadium with the current design.

Yet the injection of a huge sum of money into the construction of the main venue of the Olympics would go against IOC’s trend of reforming the Olympic Games to reduce the costs of hosting.

Setting a bad precedent may discourage other cities from hosting the Olympic Games in the future, on the ground of financial conditions.
Shimomura’s stance of going ahead with the plan with no prospect of securing a financing source is also problematic.

The construction is to be financed not only from the national treasury but also by the Japan Sport Council (JSC), an independent administrative agency in charge of the stadium project, which will break into the fund the council manages and allocate it. 

The JSC is expected to raise the percentage of sales of its sports-promoting “toto” soccer lottery allocated to the construction of the new stadium to 10 percent from the current 5 percent.

The sports ministry will make a request again to the Tokyo metropolitan government to shoulder more than ¥50 billion of the cost of building the stadium.

Even when all these measures are put together, however, it is apparent that they would fall short of the projected cost of ¥252 billion. Shimomura said that he will call for cooperation from the private sector, through donations and otherwise. But he is overoptimistic in his expectations.

We are appalled by the state of disarray in which the construction costs have fluctuated so much and so often since the JSC held an international competition with assumed total costs of ¥130 billion in 2012.

The responsibility of the sports ministry, as the competent authority, is grave. Thorough examination is needed so as not to lead to serious problems in the future.

The new stadium must not become a “negative legacy” of the 2020 Tokyo Olympics.