The Medical Equipment Leasing Industry in China
2018-09-28 15:18 Friday
Medical equipment leasing got a late start in China, when compared with other equipment and infrastructure sectors. However, soaring demand for medical equipment has led to the rapid development of medical leasing industry in recent years, with future growth expected to remain robust.
The elderly population in China aged 65 or over, has reached 149 million, accounting for 10.8% of the total population. The World Bank estimates that the elderly population in China will result in a 40% higher medical burden by the end of 2030, creating enormous demand for medical equipment.
Furthermore, urbanization, increased health consciousness, growing per capita income, and improving national medical insurance schemes, will put additional stress on China's limited supply of medical equipment.
A report on finance leasing released by the Ministry of Commerce reveals that the market value of medical equipment in China was 269 million RMB in 2016, having grown at a CAGR of 17% from 2013-2016.
The government has introduced a series of favorable policies intended to encourage the development of medical equipment leasing industry and meet soaring demand for medical equipment across China.
The State Council issued The Guidance on Development of Medical Industry on March 11th, 2016, stipulating that medical equipment manufacturers and finance leasing enterprises should cooperate in providing installment payment service for medical equipment.
The following year the State Council revised the Regulation on the Supervision and Administration of Medical Devices, with further stipulations for the management of medical equipment. Three months later, the Chinese Ministry of Science and Technology issued The Subject Plan for Medical Equipment Innovation for the Thirteenth Five-Year Plan, which encourages capital injections to expand financing channels, establish medical equipment investment funds, and normalize the investment environment.
The flurry of favorable regulation has improved investor confidence. According to the latest projections, the value of China's medical equipment leasing market will exceed 120 billion RMB in 2018, and grow at a 15.92% CAGR over the next five years, reaching a value of 232 billion RMB in 2022.