The Chinese government encourages foreign investment in the setting up of joint venture hospitals in the country, offering a maximum 70 percent ownership share in such hospitals.

The China News Service reported on Wednesday that Chinese Health Minister Gao Qiang made the statement at the China Development Forum 2007.

The report also notes that the Chinese Health Ministry and Commerce Ministry issued a joint notice, referring to private investment in state hospitals, when China first became a WTO member.

He affirmed that the Chinese government will not intervene in the management of these hospitals, but that the Health Ministry will continue to monitor medical techniques, service quality and assess personnel, according to Chinese law.

Meanwhile, Gao Qiang indicated that China will also carry out reforms in certain state-owned hospitals, including reforms to the national distribution of medical resources, 96 percent of which are currently plunged into such state-owned hospitals. He describes this imbalance as 'irrational'.

The government will introduce the market mechanism into the operation of hospitals, allowing social capital to bolster existing medical services.

Experts predict that the Chinese medical services market will expand gradually at first.

China is becoming the world's most attractive medical services market, offering significant potential for foreign investment.