China's gray economy unlocks potential amid more need for eldercare

BEIJING — With population aging becoming a common global challenge, there is burgeoning demand for innovative and comprehensive eldercare services, which unleashes growing potential for emerging industries.

With an increasingly graying population, China is expected to ride the trend and unlock rapid development of potential industries in the sector, drawing investment from foreign enterprises.

In 2023, people aged 60 and above in China amounted to 297 million, accounting for 21.1 percent of the total population. Experts have predicted that the number will surpass 400 million around 2035 and should reach 500 million by 2050.

Meanwhile, China's gray economy now stands at around 7 trillion yuan ($977.8 billion), and is expected to reach around 30 trillion yuan by 2035.

Japan and the European Union have chosen to promote the gray economy when entering an advanced stage of aging, transforming the potential of an aging population structure into driving forces of domestic consumption by focusing on the needs and preferences of seniors.

The Netherlands is exploring digital applications in the field of home care; Japan is vigorously promoting nursing robots and assistant digital technologies; and Britain is developing fundamental research and business model innovation in the gray economy, said Hu Zuquan, a researcher at China's State Information Center.

The gray economy encompasses a wide range of industries, has a long industrial chain and exhibits diverse business forms.

Business leaders in relevant industries worldwide see opportunities in collaboration with Chinese companies and have made large investments in China.

Sindora Living, a Singapore-based firm focused on nursing homes and residential care facilities, opened a high-end eldercare institution in May in Nanjing, capital of Jiangsu province in East China.

"We see a booming market for eldercare in China in the future, and we chose to invest in China," said Nathaniel Farouz, managing director of Sindora Living.

Yada Panasonic Community is another example of foreign collaboration in the industry. In 2023, the community, which aims to provide advanced eldercare services integrated into daily life, opened in Yixing, Jiangsu, along with a Wellness Smart Town infused with Panasonic technologies for aging care and healthy lifestyles.

"Panasonic brought more than 20 years of experience accumulated in Japan, where the aging problem is more severe, to China, and participated in the building plans, landscape construction and space designs of the community to create a safe and comfortable life for residents," said Tetsuro Homma, executive vice-president of Panasonic Holdings Corp.

Eldercare-related industries in China are currently mainly concentrated in basic services such as catering, nursing and healthcare, said Zhang Shixin, an official with the National Development and Reform Commission. The diversified and personalized needs of the senior community have not been effectively met, which contain huge development opportunities, Zhang said.

In 2023, the size of China's eldercare products market reached 5 trillion yuan. Meanwhile, there were more than 490,000 eldercare-related businesses in China at the end of 2023.

Jack Wu, managing partner of Acadia Advisory Group, said that as a massive market, China is a good place for British investors.

"Take the eldercare market as an example. China has a rapidly aging population, while the UK has one of the leading eldercare industries in the world, and this will become a sector with huge investment potential between the two countries," said Wu.

Xinhua