Vietnam Will Start Paying Women to Have Babies in 2027. Here Are the Five Pressures Behind the U-Turn
When Vietnam introduced its two-child policy in 1988, the country's fertility rate was still above 4. Almost 40 years later, the same government is about to start paying women to have babies.
[Vietnam Will Start Paying Women to Have Babies in 2027. Here Are the Five Pressures Behind the U-Turn]
01｜A Fertility Rate Below Replacement for Four Years Running — the Trigger
In May, Vietnam's government released the implementing decree for its new Population Law. Starting January 2027, women who give birth to two children before age 35 will receive a one-time subsidy of at least VND 2 million.
When Hanoi rolled out its two-child policy in 1988 to slow population growth, the national fertility rate was still above 4. Almost four decades on, the same government is preparing to pay people to have babies. The direction has flipped 180 degrees.
So what pushed Vietnam to "now we have to subsidise births"? A quick primer first: the total fertility rate (TFR) is the average number of children a woman will have in her lifetime, and 2.1 is generally taken as the "replacement level" needed to keep a population stable.
Vietnam's General Statistics Office put the 2024 TFR at 1.91, an all-time low. The Health Ministry's latest figure, released late 2025, ticked back up slightly to 1.93. But that comes on the heels of 2.01 in 2022 and 1.96 in 2023 — meaning Vietnam has now spent four straight years below replacement. Four years matters. A single dip can be written off as pandemic noise; a four-year run becomes a trend. Vietnam had hovered near 2.1 for almost 15 years before 2022. After breaking that line, it hasn't come back.
The regional split is just as stark. Urban TFR sits at 1.67, rural at 2.08. Ho Chi Minh City is at the bottom — 1.39 in 2024, ticking up to 1.51 in 2025. In all of Southeast Asia, only Singapore, Thailand, Malaysia and Brunei now have lower fertility than Vietnam.
02｜"Getting Old Before Getting Rich" Is Now Standard Language in Hanoi
Vietnam's 2025 GDP per capita just crossed USD 5,000 (the GSO figure is USD 5,026). That's still roughly three times below the World Bank's high-income threshold of around USD 14,000. Pair that with a fertility rate hovering around 1.9, and the phrase "chưa giàu đã già" — "old before rich" — naturally surfaces.
This isn't a label foreign analysts have pinned on Vietnam. The phrase has become a fixture inside the country, used from Communist Party theoretical journals to financial dailies.
The aging curve is already visible. People aged 60 and over now top 14 million and will add several million more over the next decade. Vietnam is on track to formally enter "aged society" status by 2036.
Set against the rest of East Asia, the contrast sharpens. Japan's TFR fell to 1.15 in 2024, a record low. South Korea's rebounded to 0.80 in 2025. Taiwan's dropped to 0.695 — overtaking South Korea as the lowest in the world. But all three reached those lows only after becoming high-income economies. Vietnam has broken replacement while still earning barely over USD 5,000 per head. That combination is rare in this neighborhood.
03｜The Demographic Dividend Window Closes in 2036 — Three Years Earlier Than Forecast
Vietnam is still in its demographic dividend phase: roughly two working-age adults supporting each dependent. But the official 2024 projection sets the closing date at 2036 — three years earlier than the 2019 version forecast. The working-age population is expected to peak in the late 2030s and decline from there.
For foreign manufacturers, this curve matters in a specific way. The southern FDI belt is also the region with the lowest fertility rates in Vietnam. This industrial triangle posted a TFR of 2.9 in 1999. It's now 1.56. Vietnam's pitch as the next manufacturing base is built on assumptions about labour supply that the demographic data is starting to undercut.
04｜Cities Are Collapsing, Villages Aren't: Why 35 Isn't an Arbitrary Number
Look again at why the law puts the cap at "two children before 35."
The 2024 mid-term census has another set of numbers that rarely makes headlines. The average age of first marriage rose from 25 in 2019 to 27 in 2024. In urban Vietnam it's higher still — first marriages in Ho Chi Minh City now happen past 30, and the number keeps climbing year by year.
Put that next to "two before 35" and the logic is plain. If urban women are marrying at 30, fitting two births into the next five years is tight to start with, and 35 is the medical threshold for "advanced maternal age." The subsidy is aimed squarely at urban middle-class women.
Vietnam's Health Ministry already launched a "Marry Before 30" campaign in early 2024, telling young people to start households sooner. The 2027 subsidy is the next step in the same logic. The government's read on the situation: Vietnamese people aren't refusing to have children. The problem is that urban women are pushing the wedding age past 30, then having only one.
05｜The Health Ministry Says So Itself: This Policy Studies What Others Did
Ask "why now," and the Health Ministry has a public answer.
Deputy Health Minister Đỗ Xuân Tuyên has stated openly that "based on the experiences of a number of countries around the world, the Ministry of Health is studying and proposing policies and solutions to firmly ensure the country's replacement fertility rate."
Newsweek framed it more bluntly: "the downward trend has spurred officials into action over concerns that Vietnam could follow the path of East Asian countries" — China, Japan, South Korea and Taiwan, all of which have seen fertility falls. That framing isn't something a Western outlet pasted on after the fact. Communist Party journals and state media in Vietnam have been publishing analyses of China, Japan and Korea's population troubles for years. Neighboring failures are a standing topic inside the party, academia, and the press.
The Vietnam-China timing contrast is the one worth flagging. When Beijing eased its one-child policy, China's TFR had already fallen far below replacement. Vietnam's 1.93 is still relatively close to the line. That leaves Hanoi a window to act early rather than scramble later.
06｜Three Years of Local Trials, and the Results Aren't Pretty
Before the central scheme, at least five southern provinces had been running their own versions for three years. Subsidies ranged from VND 450,000 to VND 1.5 million, mostly tied to the "two before 35" condition, plus certificates and prenatal care benefits.
The results haven't been encouraging. VnExpress ran the story under the headline "Cash incentives fail to boost birth rates." TFR in most provinces is still falling; the handful that ticked up are still well below replacement.
Population Department director Lê Thanh Dũng said so himself: "cash incentives are only one of several methods." He publicly expects the national TFR to keep falling.
In other words, the people running the 2027 program know money alone won't pull fertility back up.
07｜What the National Scheme Actually Changes — and It Isn't the Amount
VND 2 million is only marginally higher than the local versions and lives in the same order of magnitude. If three years of provincial trials didn't move the needle, a small bump from Hanoi isn't going to produce a miracle.
What's actually different lives in three places, none of them about the cash.
First, the old 2003 Population Ordinance was about controlling growth and capping families at two. The new law explicitly writes "maintaining the replacement fertility rate" into national legislation. The direction is reversed.
Second, the package isn't just cash. Maternity leave for a second child extends from 6 to 7 months for women, with 10 days of paternity leave added for fathers. Families with two or more children get priority access to social housing. These shifts in time and housing costs probably matter more to households than a one-time VND 2 million transfer.
Third, the central scheme replaces a patchwork of provincial deals. Hanoi sets a floor; provinces can still add on top.
The demographic dividend window has about 10 years left (2026 to 2036). What Vietnam actually has to do isn't pull 1.93 back up to 2.1 — it's stop the curve from sliding further. Deputy Minister Tuyên's phrase "firmly ensure the replacement fertility rate" is the real anchor of this policy push. The goal is to hold the line, not to reverse it.
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