China’s growing elderly population presents demanding situations and opportunities for the economy. In a new set of opinions, the State Council proposes various measures for social assistance systems and infrastructure for the elderly population and expand various business segments to take advantage of new market opportunities. We talked about how the proposals aim to grow China’s silver economy, from creating niche markets to government aid for elderly care projects.
The General Office of the State Council has released a new set of Opinions on Developing a Silver Economy to Improve the Well-being of the Elderly (the “opinions”).
The 26-point document proposes a variety of measures for nursing homes to take advantage of the new opportunities presented by China’s aging population.
The fight against an ageing population is a sensible priority for the government. In 2022, China’s population shrank for the first time in six decades, with 850,000 fewer people than last year. This decline accelerated in 2023, when the population declined further through According to the UN’s population model for 2022, China’s population could fall to 1. 313 billion by 2050 and fall below 800 million by 2100.
China’s declining population poses many challenging situations for the country’s long-term development, not least because existing structures for older people are inadequate, even despite the current dependency ratio of older people. systems of care for the elderly and lead to labour shortages in key sectors such as manufacturing.
At the same time, the ageing of the population represents a great opportunity for the so-called “silver economy”. In 2023, people over the age of 60 accounted for 21. 1 percent of the total population, while those over the age of 65 accounted for 15. 4 percent. These figures crystallize the fact that China’s elderly population is becoming a giant and influential customer base that companies want to take seriously to ensure their longevity in the country.
The revisions involve many proposals for the country’s infrastructure for the elderly, which will help ensure the fundamental wishes of the elderly population and their overall quality of life.
These come with improving mechanisms to cover certain basic needs, such as food, shelter and the network, improving the provision of physical care to the elderly and offering more functions for education and entertainment, among other initiatives.
Specific projects include:
In addition to the social facet of senior living facilities, the reviews also highlight tactics to capitalize on the older population as a customer base and expand the overall silver economy, while striving to create products and facilities for seniors.
To expand the silver economy as a whole, the revisions propose pilot and progression initiatives. This includes selling the progression of trading groups by planning 10 trading parks of the so-called “silver economy” in progression zones, such as the Jing-Jin. -Ji Economic Circle, Yangtze River Delta, Greater Bay Area and Chengdu-Chongqing. Twin Cities Circle. They also call for facilitating interregional and foreign cooperation through flexible industrial zones (FTAs) and demonstration zones.
Meanwhile, the opinions also highlight several sectors within the silver economy, providing a useful snapshot of sectors that are considered to have high potential.
Sectors include:
The final component of the reviews focuses on the means government agencies should have to advise and publicize the progress of the silver economy. This segment provides the clearest indication of the government’s concrete measures for the progress of the industry, requesting the allocation of government budget for various projects, among other measures.
For instance, the opinions propose formulating land supply plans in order to meet the land requirements for elderly service facilities and companies operating in silver economy industries. Specifically, the opinions propose planning the establishment of community elderly service facilities in newly built residential areas based on a per capita land area of no less than 0.1 square meters. Idle commercial, office, industrial, and warehousing spaces will also receive support to be converted into safe elderly service facilities.
The revisions also call for tighter monetary and fiscal policies for the silver economy.
Among the investment proposals, it is worth highlighting the call for financing of eligible allocations similar to the silver economy through Special Purpose Bonds (SPBs) of local governments. The BPS is one of the main instruments available to the central government to move the budget to local governments to invest (mainly) in public infrastructure allocations. This means that local governments will be encouraged to spend BPS to fund similar allocations to elder care, which will help local elder care facilities and services while also offering more investment features in allocations for local governments.
Financial institutions are also encouraged to increase support for the construction of elderly service facilities and developing silver economy industry projects.
Finally, the reports address the long-standing problem of fraud against the elderly, calling for extensive anti-fraud education activities for older people and the fight against types of fraudulent schemes, particularly pension scams.
The reviews are not intended to announce express policies or incentives to expand the silver economy. Rather, they seek to explain and organize government priorities for industry progress and tell local governments to formulate and implement progress plans and policies.
For businesses, they provide a detailed summary of the types of products that will be the focus of government efforts and investments and that the government believes have significant potential. In the future, local governments could also create express incentives for companies to provide this information. space.
Companies operating in or planning to enter China’s elder care industry can, along with conducting their own market research, align business models and offerings with the market segments highlighted in the opinions. The aging population in China presents both challenges and opportunities for businesses, making it imperative for companies to adapt and thrive in this evolving landscape.
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China Briefing is written and produced by Dezan Shira
Shira Dezan
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