China has the second-largest healthcare industry in the world and its healthcare market has been more rigorous especially in light of the COVID-19 pandemic during 2020. The country has revamped its take and its priorities involving its healthcare system. It has since pushed for several aspects into priority projects involving encouraged industries and market entry of foreign investors.
Check out our previous article on China Market Entry: A Guide for Potential Investors
Find out the opportunities and core areas in today’s healthcare industry in China, and other related news that might concern potential and current, local, or foreign investors.
Size of the healthcare industry
In 2017, the market value for the healthcare service market in China was estimated at RMB 6.22 trillion and is expected to continue growing. Healthcare services include services such as:
- Providing medicine, medical or surgical treatment;
- Hospital service;
- Dental service;
- Optometrical service; and
- Complementary health services or any such service-oriented enterprise oriented towards the prevention, alleviation, curing or healing of human illness, physical disability or injury.
Priorities for the healthcare industry
The Chinese government has implemented some set of regulations even before the onset of the pandemic. These regulations are intended to boost foreign investments in different encouraged industries in China, including healthcare services. Below is the list of areas that may be accessible for foreign market entry:
These types of companies and those others cited in the list may avail of the duty exemption policy from the national government.
Due to the recent pandemic, China (and the rest of the world) moved to shift its priority to the circumvention and prevention of the further spread of the virus. Hence, the physical and mental aspects of the people, whether afflicted by the virus or not, became a vital concern even for businesses.
Opportunities for growth in the healthcare market
Since the virus, most of China has seen the fast-paced action of the healthcare system in China, although much growth is still seen towards the future. The healthcare industry is geared towards innovative progress that takes into consideration the effects that the pandemic has had on the world. Medical insurance is most likely to be seen as more of a necessity now more than ever. Hospitals have increased in number due to the greater demand brought by 2020. Other aspects of the healthcare market may include:
- Technological advancements (e.g. AI-assisted hospital services) will be adopted faster
- Vaccines and other pharmaceuticals to be in high demand
- Hospitals in China, both new and old, will need upkeep and staff
- Nursing homes
- The biotech market in China is on the rise
- Diabetes treatments especially foreign brands
Aside from COVID-19, urbanization, migration to metropolitan areas, an aging populace, rise in wages, increase in living standards, and a preference for technological innovations are all contributing factors that potential businesses might want to consider in looking for market opportunities in the healthcare industry in China.
COVID-19 may have been a devastating catastrophe, but it was a catalyst for change nonetheless. With the increasing size of the healthcare industry in China, investment opportunities are pretty vast as well. However, with the regulations imposed by the government on foreign investment, potential investors planning on venturing out to China (or even those that are already players in the market) may need competent professionals to help them with their business prospects and dealings.
S.J. Grand provides advisory on setting up a business in China. We put our competent team at your service to give you the most effective China market entry and tax optimization strategy. Contact us to get you started.
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