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May 18, 2012

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Home » Metro » Society

City pushes privatization of senior care

SHANGHAI will step up efforts to encourage social forces such as non-profit organizations to provide services for the growing number of elderly people through subsidies, preferential policies and government service purchases, the Shanghai Civil Affairs Bureau said yesterday.

A gradual transition from government investment to private fund investment, joint venture and equity participation is expected as the sector moves in a market and industry-oriented direction, said Ma Yili, director of the bureau.

However, after regulations were relaxed last year to allow foreign investment in the seniors' service field, the response was not good in Shanghai.

"Foreign investment is encouraged and warmly welcomed, but few overseas companies have so far established nursing homes in the city or expressed willingness to invest," Ma said.

"The (limited) purchasing power of local seniors, who receive 2,000 yuan (US$320) to 3,000 yuan of pension per month, may explain the hesitation in investment," Ma said.

Cooperation between government authorities and foreign firms is limited to purchasing equipment such as wheelchairs for elderly people, said Ma.

Last year, the Ministry of Civil Affairs allowed foreign-invested firms to provide care for seniors, but only in joint ventures with Chinese firms.

Overseas participants at the first China International Senior Services Expo, which runs through Saturday at the Expo Exhibition & Convention Center, expressed caution about investing in the market.

Liu Ying, sales manager of Nichii Carenet China Co Ltd, under Japan-based medical services company Nichii Corporation, said his firm will provide facilities, training and consulting for government-invested high-end homes for elderly people, but the time is not mature to make investment directly.

"The Japanese side ... will wait to see the market response before stepping in," he said.

Only 3 percent of Shanghai seniors who meet certain criteria are expected to spend their old age in retirement homes.


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