Private Firms Encouraged to Invest in Senior Care Sector (China)

Singapore-China Economics & Trade Cooperation

China (December 7, 2007)

The Chinese government encourages private capital to invest in services for the elderly as the country feels pressure from its increasing aging population, a senior official said at a national symposium on senior care on Wednesday. "It's a shortcut to promote wholesome and rapid development of senior care service with China's underdeveloped economy and limited financial input in the public sector," said Zhang Ming Liang, director of the Social Welfare and Social Affairs Department of the Ministry of Civil Affairs. The government has constituted favorable policies for institutions in terms of capital investment, land provision and taxation, further mobilizing social resources to take part in initiating senior care undertaking, Zhang said.

Zhang pointed out that private sectors could set up their own senior care institutions or in joint venture. The government will introduce a series of policies and regulations to guarantee their lawful operation, and allocate more funds to purchase senior care services. The value of China's social security fund had reached 400 billion yuan (US$53.3 billion) by the end of June this year, according to the National Council for Social Security Fund (NSSF).

China's social security fund was established in August 2000 to prepare for the country's coming peak of an aging population. The government also encourages more volunteers to provide senior care services in communities, Zhang said. It is predicted that the country's total population will peak at 1.46 billion in 2030 and the number of senior citizens will hit 437 million by 2051. "Suppose that five percent of China's 145 million elderly population need to live in old folks' homes," Zhang said, "more than seven million beds will be needed, but the present number of 1.7 million beds is far from enough."

China now has more than 40,000 senior care institutions with about 1.7 million beds for its population of 145 million over 60, of which about 67 percent live in rural areas and about 13 million aged people over 80 are now in dire need of care, according to figures from the Ministry of Civil Affairs.

Source GAA