Sun­rise sec­tor bright­ens sun­set years

China’s el­derly care mar­ket is set for a gi­ant leap on en­try of for­eign cap­i­tal

China Daily (Latin America Weekly) - - 13 Business - By ZHENG YIRAN zhengyi­[email protected]­

Eco­nomic risk or hid­den op­por­tu­nity? Or, is it a po­ten­tial game-changer, even an eco­nomic growth driver?

These days, such ques­tions di­vide ex­perts de­bat­ing de­mo­graphic fore­casts that China would soon be­come an ag­ing so­ci­ety, slow­ing the Chi­nese eco­nomic jug­ger­naut.

Thanks to an imag­i­na­tive tweak of the coun­try’s re­form and open­ing-up pol­icy, the threat seen in an ag­ing so­ci­ety may turn out to be a huge busi­ness op­por­tu­nity, ex­perts said.

By the end of 2017, there were 241 mil­lion Chi­nese, or 17 per­cent of the pop­u­la­tion, aged 60 or above. And 158 mil­lion of them, or more than 11 per­cent of the pop­u­la­tion, were aged 65 or above, as per the data of the Na­tional Bu­reau of Statis­tics.

The coun­try’s el­derly pop­u­la­tion is in­creas­ing by 10 mil­lion an­nu­ally. It is es­ti­mated that by 2020, those aged 65 or over will ac­count for 14 per­cent of the pop­u­la­tion.

A fore­cast from the World Health Or­ga­ni­za­tion said that by 2050, more than 35 per­cent of the Chi­nese pop­u­la­tion will be aged 60 or above, which would make China the coun­try with the most num­ber of ag­ing peo­ple.

In any other coun­try, such fig­ures might trig­ger alarm bells, given the ad­verse im­pact that an ag­ing so­ci­ety has had on the Ja­panese econ­omy in re­cent years; but in China, the dis­course ac­quired a par­al­lel track with a pos­i­tive charge.

A re­port from the Chi­nese Academy of So­cial Sciences said el­derly care is a sun­rise in­dus­try whose an­nual sales could reach an es­ti­mated 13 tril­lion yuan ($1.87 tril­lion) by 2030 from the cur­rent 5.9 bil­lion yuan.

Such stu­pen­dous growth is ex­pected on the ba­sis of the ex­pe­ri­ences of de­vel­oped coun­tries. A large base of ag­ing peo­ple in an econ­omy that has seen both re­struc­tur­ing and sus­tained rapid growth is a per­fect recipe for grow­ing a so­phis­ti­cated mar­ket for se­nior-care ser­vices.

That’s be­cause peo­ple would have ben­e­fited from ris­ing in­comes and saved a bit in the past for a sta­ble, fi­nan­cially stress-free post-re­tire­ment life, ex­perts said.

On top of that, when new pol­icy mea­sures en­able for­eign in­vest­ment in the po­ten­tially lu­cra­tive el­derly care sec­tor, what could have been a risk may prove to be one of the driv­ers of eco­nomic growth, they said.

Such in­ter­pre­ta­tions ap­pear plau­si­ble in a pri­vate nurs­ing home in Wei­hai, Shan­dong prov­ince. Here, Sun Ying, 85, and her hus­band Zhang Wei, 86, ex­pe­ri­ence their sun­set years in quiet con­tent­ment and peace, in spite of Zhang’s neu­ro­log­i­cal con­di­tion that was de­tected three years ago.

Their peace ap­pears to arise from the fact that they live in a com­mu­nity of sim­i­lar age peo­ple. The com­mu­nity is a com­mer­cial ven­ture that is op­er­ated by pro­fes­sion­als who de­liver ser­vices tai­lored to ex­act­ing stan­dards.

The nurs­ing home, called Dongfa House, was Sun and Zhang’s choice when they re­al­ized they needed care. They did not want to be a bur­den on their chil­dren who live hec­tic lives.

Sun said: “Here (in the nurs­ing home), each of us has a health record. Our BP (blood pres­sure) is checked once a week. We re­ceive med­i­cal at­ten­tion when­ever re­quired. I en­joy read­ing books ev­ery day, while my hus­band of­ten plays with his poker-mates.

“Some­times, stu­dent vol­un­teers come here to per­form for us. Com­pared with pub­lic nurs­ing homes, we find the staff here to be more pa­tient. Our lives have been en­riched.”

So are lives of all the stake­hold­ers con­cerned — nurses, care-givers, doc­tors, phys­io­ther­a­pists, at­ten­dants, plumbers, elec­tri­cians, me­chan­ics, con­struc­tion work­ers, florists, ma­te­rial sup­pli­ers, providers of var­i­ous other ser­vices.

An el­derly care project en­tails a plethora of in­vest­ments, ac­tiv­i­ties and ser­vices. Done on a mass scale across a vast coun­try like China, it could help drive eco­nomic growth, ex­perts said.

For in­stance, the nurs­ing home that Sun and her hus­band live in charges a monthly fee of 2,140 yuan per per­son. They live in a mid-range 30-square-me­ter apart­ment. A high-end apart­ment could cost 2,460 yuan per per­son per month.

The fee in­cludes a buf­fet meal ev­ery day. Res­i­dents un­dergo a phys­i­cal be­fore ad­mis­sion; the prac­tice en­sures no one with in­fec­tious dis­eases gets ad­mit­ted.

There are many tak­ers for mod­ern el­derly care ser­vices in China. Stated dif­fer­ently, de­mand out­strips sup­ply. So, the gov­ern­ment has amended reg­u­la­tions to al­low the pri­vate sec­tor to set up profit-ori­ented busi­nesses in el­derly care. Small won­der, for­eign in­vestors are lin­ing up to back a range of projects in this seg­ment.

Al­ready, 29 prov­inces and au­tonomous re­gions have de­cided to open up their el­derly care mar­kets. And 26 of them have pro­posed for­eign in­vest­ment in the seg­ment.

In fact, in Jan­uary, China’s Taikang Com­mu­nity, a pri­vately


held firm, teamed up with French se­nior-care com­pany Orpea, to set up a joint ven­ture on the Chi­nese main­land.

Ac­cord­ing to their strate­gic part­ner­ship, the two en­ti­ties will co­op­er­ate and ex­plore the mar­ket for ur­ban-type nurs­ing

homes and re­ha­bil­i­ta­tion cen­ters in China.

Orpea will pro­vide its ad­vanced care tech­niques as well as bring stan­dards and pro­cesses. For its part, Taikang

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