The market

In 2020, China’s population is expected to reach 1.4 billion, 248 million of whom will be aged 60 years and over (Source:Trends and predictions on China’s ageing population , China National Committee of Ageing). These elderly citizens will require accommodation in facilities that support their medical needs and lifestyle as well as a qualified workforce to care for them. These are currently both in short supply. The growing middle class population is also demanding high-quality services which will put more pressure on a medical system that is already grappling with new health issues like cancers, heart disease and obesity.

The Chinese Government has started an ambitious program to transform the country’s healthcare and aged care industry. The government is accelerating progress by introducing policies to attract private capital from domestic and overseas investors and encourage the adoption of smart healthcare. There is a strong focus on developing the aged care industry as the government aims to provide 35 to 40 care beds per thousand elderly citizens and a workforce of 10 million aged care workers by 2020.

There has been large-scale investment in the development of aged care facilities by the public and private sectors in recent years. In 2015, China had 6.7 million aged care beds which represents an increase of 176 per cent from 2012. The fastest growth occurred in well-developed provinces and municipalities where the pressures of ageing populations are greatest, including Beijing, Chongqing, Guangdong, Hainan, Hubei, Hunan, Jiangsu, Shandong, Shanghai, Sichuan, Tianjin and Zhejiang.

Healthcare and aged care services require a specialised, skilled workforce that is trained to professional standards. The current workforce consists of nurses and casual care workers, typically managed by healthcare professionals or managers with backgrounds in hospitality. The National Health and Family Planning Commission has reported that only 50,000 aged care workers and 38,000 medical care workers have vocational qualifications in China.

Even with the rapid development of recent years, the aged care industry in China is still in its infancy. There is a significant shortage of aged care facilities and the support services industry is just emerging. Industry standards, workforce skills, aged care training, operations management, quality assessment and insurance services are insufficiently established to meet the future needs of elderly patients.

Opportunities
Aged Care Services

Aged care is an emerging industry in China. A large number of local investors, designers and operators do not have adequate knowledge or experience in investing, building and operating modern aged care facilities.

Recent interest in Australian aged care expertise has come from:

●state-owned enterprises
●real estate developers
●property management companies
●life insurance companies
●healthcare and aged care investors and operators
●local design institutes (as partners) to vocational educational and training institutions.

Demand from these groups often focuses on Australian expertise in:

●consulting services for investing in aged care facilities, for example, investment models, operation management models, operational service standards, security and safety standards, and human resource planning, training and development
●architectural design services including master planning and interior design
●operations and management services provided under management contracts or through the establishment of joint ventures with Chinese organisations, for example, service planning, project management, facilities and asset management.

Aged Care Workforce Skills Development and Training

Human resource capacity building is in urgent demand in China, fuelled by a growing population of senior citizens who require different levels of professional care. In 2013, there were approximately 97 million elderly citizens with chronic diseases; 39.5 million disabled elderly citizens; and 50 million elderly people with limited access to proper care services (Source: 2013 China Aged Care Development Report, China Research Centre on Aging, Social Sciences Academic Press). With the Chinese Government introducing a nationwide policy to integrate healthcare and aged care, the demand for qualified and skilled care workers is expected to grow. By 2020, it is estimated that China will require a workforce of 10 million to care for an elderly population of 248 million.

These workers could benefit from Australian expertise in:

●tailored training courses
●on-the-job training
●training for trainers
●short-term study tours and certificate programs overseas and in Australia.

Marketing your products and services
Market entry

The Chinese Government is introducing preferential policies to attract private investment. The industry, however, is expecting more significant changes and improvements, particularly in policies that are associated with the distribution of government subsidies, taxation and land acquisition. In addition, a shortage of human resources and a low quality of service present opportunities for Australian companies that are looking to be involved in China’s aged care industry.

The Australia China Free Trade Agreement (ChAFTA), which came into force on 20 December 2015, enables Australian medical service suppliers to be able to establish wholly Australian-owned hospitals in China, including in Beijing, Tianjin and Shanghai, as well as in the provinces of Jiangsu, Fujian, Guangdong and Hainan.

Additionally, China has made its first ever commitment on aged care services in an FTA, allowing Australian medical service suppliers to establish wholly Australian-owned profit-making aged care institutions in China with no geographical restrictions.

Austrade China has a team of business development staff dedicated to the health care and senior living sectors. Austrade’s staff can offer Australian companies services such as:

●research into the Chinese market
●practical advice on market-entry strategies
●assistance in establishing links with Chinese companies.

Austrade Aged Care Initiatives 2016-17

●Australia-China Aged Care and Healthcare Forum and Expo, Guangzhou, 10-13 November 2016
●Australia Aged Care Training Demo Class Roadshow, 19-23 March 2017
●Medical Mission for China 2017: Smart Health and Private Hospital Forum, 14-18 May 2017.

Contact details

The Australian Trade and Investment Commission – Austrade – contributes to Australia's economic prosperity by helping Australian businesses, education institutions, tourism operators, governments and citizens as they:

●develop international markets
●win productive foreign direct investment
●promote international education
●strengthen Australia's tourism industry
●seek consular and passport services.

Working in partnership with Australian state and territory governments, Austrade provides information and advice that can help Australian companies reduce the time, cost and risk of exporting. We also administer the Export Market Development Grant Scheme and offer a range of services to Australian exporters in growth and emerging markets.