Chinese aged care market offers potential, but investment must be long-term

Delegates from the first Australia-China International Aged Care Summit have said the Chinese aged care market represents “enormous” opportunity, but warned investment must be a considered process.

Delegates from the first Australia-China International Aged Care Summit have said the Chinese aged care market represents “enormous” opportunity, but warned investment must be a considered process.

The summit, held last week in Beijing, was a collaboration between AusTrade and the national Chinese peak body of aged and healthcare industries. Attended by around 150 Australian delegates, it was the largest health and aged care trade mission to have left Australia.

For delegate Fiona Somerville, commercial director of The Ideal Consultancy, the most striking feature of the event was the level of interest and enthusiasm from the Chinese, with around 500 Chinese delegates in attendance.

“Our robust service models, our delivery framework and our quality systems were areas the Chinese thought they would value out of learning from,” Ms Somerville told Australian Ageing Agenda.

The summit followed the official signing of the China-Australia Free Trade Agreement in June, which will allow Australian-owned hospitals and aged care facilities to be freely established in China.

The FTA was a likely reason behind the event’s popularity, said another delegate, Lisa Hee, senior lecturer and director of Healthy Ageing and Dementia Programs at Central Queensland University.

“China seems to be more keen to be dealing with Australia as a result; it’s almost as if the publicity around the free trade agreement itself has had instant benefits,” Mrs Hee told AAA.

Mrs Hee, who is also the director of the Elite Health Care Consultancy, said China represented “enormous opportunity” for Australia, as all of the 500 delegates were businesses wanting assistance.

In addition, Chinese investment into the Australian aged care market was also a popular topic of discussion, said Ms Somerville.

Fiona Somerville
Fiona Somerville

“There were a number of organisations who certainly had the capital and they were very interested in investing in Australia. They see it as a really solid safe market, with good returns and very established,” she said.

Aged care in China

Like Australia, China has an ageing population, with the number of people over 60 set to double by 2050 to around 440 million, or 30 per cent of the population.

The need for aged care in China is also growing for cultural reasons. Previously, elderly parents were expected to live with their children as they aged, but the one child policy has begun to limit the potential for this.

In response, the Chinese government in 2013 committed to double the number of aged care beds to eight million by 2020, and increase its aged care workforce from around one million to 10 million.

Mrs Hee said the current quality of aged care offerings in China remained variable, and while there were some “fabulous” facilities, they were often targeted towards the wealthy.

“At the moment there’s just not enough support for the low or middle income earner… You can see some services trying to accommodate those people, but there isn’t a standard, clear-cut way of how that would be funded,” she said.

Australian funding models was one area of interest brought up by Chinese delegates at the event, said Mrs Hee.

“For aged care standards and the aged care system, they very much look at Australia as a leader,” she added.

Australian parallels and investment

Ms Somerville said an interesting takeaway from the summit was that China was facing some of the same challenges and had similar goals as Australia – such as the desire to remain at home – and found there was a strong focus on active living and maintaining community connection.

“The Chinese are probably in a different stage in their life cycle, but they are super quick to learn and adapt,” she said. “They can raise the money, they can build things, but they acknowledge that they do need help in establishing a probably more robust aged care system.”

Beyond service delivery and quality systems, Ms Somerville noted there was a significant interest in Australian aged care design as China looked towards more integrated care models.

In terms of education and training, both delegates noted dementia as one area where Australia could offer significant expertise.

Mrs Hee said there was little attention currently given to those with dementia in China, and there was a lack of understanding about the nature of the disease and how it differed from psychiatric illness.

Ms Somerville said dementia remained a taboo and warned that all education and training must be specifically tailored towards cultural specifications of the Chinese market.

Lisa Hee
Lisa Hee

‘Do your homework’

Despite the many opportunities in China, both delegates warned investment was a long-term process.

Mrs Hee said it was important to take into account Chinese cultural and business considerations, and establish sincere, ongoing relationships. Many Chinese operators had already been spurned by other overseas investors looking to make fast money, she said.

“You cannot go in there in there and say, ‘we’re from Australia; we’re going to tell you how it’s done’. That definitely won’t work,” she said.

“It’s very important that you find out exactly what it is that they’re aiming to achieve; what their visions are, their goals are and how they want people to be involved.”

Ms Somerville said investing in China meant “doing your homework” and existing successful examples had spent considerable time and resources, and had established a local presence to create trust. There were also many Chinese legal requirements to take account of, she said.

“China’s probably a different part of the business; it couldn’t be just swapped in with your normal day to day operations,” she said. “Organisations that are looking to take small steps and bring their expertise in will be really highly valued.”

Want to have your say on this story? Comment below. Send us your news and tip-offs to 

Subscribe to Australian Ageing Agenda magazine (includes Technology Review

Sign up to AAA newsletters

Tags: austrade, australia-china, Australia-China International Aged Care Summit, china, fiona-somerville, free-trade-agreement, lisa-hee,

1 thought on “Chinese aged care market offers potential, but investment must be long-term

  1. Interesting article and well presented discussion. You are quite correct, the Australian aged care model is highly regarded, and this comes from the top down in the central ministry, where delegations have toured globally and to Australia in recent years. I was fortunate to be invited to spend almost 18 months working in China helping to establish aged care services to Australian standard. Some additional critical factors are:
    1) Local connections and networks – you need these to engage the seniors market (which is complex and different to Australia), information on other services and competition, and access to a range of potential partners/allies for business operations;
    2) Identification of good sources of labour workforce. As we were situated in Beijing, we ended up recruiting from colleges in regional areas for front-line care workers due to their more traditional values and elder respect. They provided better fit & retention rates than the city/metro workers.
    3) A good understanding of Chinese culture and values. Their needs and service aspirations are quite different to those of Australian/Western/European cultures. What is needed, wanted, and how it is delivered is unique. And everything is negotiable & re-negotiable.
    4) Integrity, credibility and trust is vital and hard won, however, the power of ‘word of mouth’ and a good reputation is gold.
    5) The Chinese health sector wants to partner with and learn from Australia, they do not want to be patronized, they want to go on a journey with you to become better.
    6) Importing Australian or western aged care systems into China does not work. You can take the ethos, principles and desired outcomes, however everything you plan, design and build must be collaboratively created from within, else you risk failure.
    Good luck to the entrepreneurs.

Leave a Reply

Your email address will not be published. Required fields are marked *