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Asian Condom Industry Hit Hard By China’s New Two-Child Policy

Jacob Bojesson

Asian condom manufacturers saw their shares drop Friday after the Chinese government announced that couples can now have two children instead of one.

Many businesses making baby-related products are cheering the increased cap, expecting increased revenue from an expected additional 3 million to 6 million babies each year. Credit Suisse estimates the additional babies will result in an additional $19 billion to $38 billion of spending.

But the condom industry in Japan took a hit from the news, with a 10 percent decline for the stock of Okamoto Industries Inc. Friday. Condom regulations are highly restricted in China, which has created a large industry in neighboring countries. (RELATED: The Insane Numbers That Explain Why China Abolished Its One-Child Policy)

Companies making hair and skin products for children benefitted the most — their sock soared by 40 percent on the Hong Kong stock exchange.

The effects of the change were seen as far away as New Zealand, where the local dollar increased 1 percent in value. New Zealand is a major producer of dairy products and milk powder, which are both expected to be exported in larger amounts due to the policy.

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