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China's Medical Apparatus Market: A Business Bonanza

The medical apparatus industry is a capital-intensive, technology-intensive, and highly competitive industry that integrates many sciences. The industry is one of the hallmarks that bespeak a country's manufacturing competence and high-tech level.

China's medical apparatus market displays considerable potentials for huge development. Experts say the market will further boom this year and in years that follow. According to experts, the following are good reasons for the up-coming boom:

Favorable changes in state health care policies
As the government takes further measures to curb medical expenditures, hospitals will inevitably seek to offer better and more efficient diagnostic and therapeutic services based on medical equipment to ensure their profits. Hospitals will tend to purchase therapeutic equipments that are of good quality and can deliver multifunctional therapeutic services.

Growing population
The natural growth of the population is the most essential factor that drives the consumption of medical commodities.

Social development
The demand on medical devices is continuously stimulated by ever growing life expectancy, the growing percentage of the old-people in the population structure, and the common desire to improve life quality.

International and domestic economic environment
As China quickens its steps to merge with the international market, more domestic hospitals will upgrade their medical hardware. This will definitely create a bigger market for medical apparatus.

Product Mix Restructuring
Previously, medical equipments used to be single-function machines. For example, one machine did one sort of special diagnosis. The other offered one single special therapeutic service for one special disorder. Yet another did a single job in a hospital lab. Nowadays, the trend in the medical apparatus market is to integrate several functions into one machine. Many different functions such as diagnosis, therapy, analysis, examination, rehabilitation, physical therapy, massage, and healthy care, are extended and more effectively combined if possible and if necessary. The new trend will continue to adjust the product mix in the market and will create more market for such medical apparatus.

Technological breakthroughs
As more and more new technologies are introduced, medical apparatuses display considerably more unique and effective features in sensitivity, applicability, early diagnosis, microanalysis, diagnosis and treatment. The medical apparatuses of new generations will inevitably drive machines of older generations out of market and touch off the demand for newer devices. It is estimated that the market capacity will grow to 86 billion yuan by 2005.

In the past several years, the export of medical apparatuses has been keeping a strong increasing momentum. The total export volume of the medical apparatus stood at 833 million US dollar in 2001, a 25.76% increase on a year-on-year basis. But an analysis of the general situation of import and export in the field will show clearly that China's medical equipment export is mostly low value-added products with low technological content whereas imports are mostly expensive high-tech instruments.



A Tentative Analysis on the China's Import of Medicines and Medical Equipment

In 2001, China's mainland showed a rapid increase in both import and export volumes in the field of medicines and medical apparatus. According to statistics by the state customs, the total import value in the field stood at 7.44 billion US dollars, a 20.35% increase on the year-to-year basis, accounting for 91.75% of the 8.143 billion US dollars spent on the import of the medical equipment and health care products. The trade surplus was 670 million US dollars, a 37.96% drop due to the surge of import and less growth in export on the year-to-year basis.

Medical equipment is one of China's major imports. In 2001, China imported 1.621-billion-USdollar-worth medical equipment, a 44.34% increase on the year-to-year basis, accounting for 45.80% of all the medical and health care related products value (3.54 billion US dollars). Of the imported equipment, X-ray fault examiners, X-ray equipments for surgery and veterinary, other medical apparatuses and equipment for hospital surgery and veterinary, NMR imaging apparatuses were the leading products. Other imported commodities in this field are as follows (in the order of their percentages): patent medicines (23.15%), pharmaceutical aw materials, agricultural chemicals (4.98%), bio-chemicals (2.22%), medical dressings (0.51%). The pharmaceutical raw materials and bio-chemicals shot up while agricultural chemicals and medical dressings dropped. Imports from developed countries grew by big margins.

In 2001, imports of patent medicines and medical equipment from Europe, Asia and North America accounted for 98.91% of the total 3.4 billion-US-dollars imports in the field. Europe accounted for 46.17%. The top ten exporters are as follows (in the descending order): Germany, France, Britain, Italy, Swiss, Holland, Belgium, Sweden, Spain and Austria. Asia accounted for 30.27%. The major exporters were Japan, Korea, India, Singapore, Indonesia, Israel, Vietnam, and Thailand; North America accounted for 22.47%, the United States was the major trader in this field. The imports from Latin America stayed unchanged compared to 2001. The United States was the number one seller in 2001 to China, showing a 47.49% increase on the year-to-year basis, and accounting for 22% of the total imports. Japan and Germany were the second and third exporters to China in this field.

As China will call off the approval procedure for the imports of large-size medical equipment and lower the import tariffs after its ascendancy into WTO, more large-size precision medical equipment will be imported. Therefore, there is a broad and brilliant prospect for the further development in China's domestic market for medical apparatuses.



China's Medical Apparatus Market: A Business Bonanza

China's medical apparatus market displays considerable potentials for huge development. Experts say the market will further boom this year and in years that follow. According to experts, the following are good reasons for the up-coming boom:

Favorable changes in state health care policies
As the government takes further measures to provide better health care provision, hospitals will inevitably seek to offer better and more efficient diagnostic and therapeutic services based on medical equipment to ensure better services. Hospitals will tend to purchase therapeutic equipments that are of good quality and can deliver multifunctional therapeutic services.

Growing population
The natural growth of the population is the most essential factor that drives the consumption of medical commodities.

Social development
The demand for medical devices is continuously stimulated by ever growing life expectancy, the growing percentage of the older-people in the population, and the common desire to improve life quality.

International and domestic economic environment
As China quickens its steps to merge with the international market, more domestic hospitals will upgrade their medical hardware. This will definitely create a bigger market for medical apparatus.

Product Mix Restructuring
Previously, medical equipments used to be single-function machines. For example, one machine did one sort of special diagnosis. Another offered one single special therapeutic service for one special disorder. Yet another did a single job in a hospital lab. Nowadays, the trend in the medical apparatus market is to integrate several functions into one machine. Many different functions such as diagnosis, therapy, analysis, examination, rehabilitation, physical therapy, massage, and healthy care, are extended and more effectively combined if possible and if necessary. The new trend will continue to adjust the product mix in the market and will create more market for such medical apparatus.

Technological breakthroughs
As more and more new technologies are introduced, medical apparatuses display considerably more unique and effective features in sensitivity, applicability, early diagnosis, microanalysis, diagnosis and treatment. The medical apparatus of new generations will inevitably drive machines of older generations out of market and touch off the demand for newer devices. It is estimated that the market capacity will grow to 86 billion yuan by 2005.



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