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Demystifying Chinese Investment in Australian Healthcare
Chinese Investment in Australian Healthcare
Chinese investment in healthcare has soared over the past 3 years. Australia is becoming a highly sought after destination for healthcare investment due to the expertise of health professionals, availability of cutting-edge technology, and high regulatory standards. As China’s aged care industry develops and its medical treatment sector matures there will be a greater need for these high quality products and services and more demand for the businesses providing them.
This January 2018 report is the latest in a series of 'Demystifying Chinese Investment in Australia' reports, by KPMG Australia and The University of Sydney's Business School. It examines Chinese investment in the Australian healthcare sector for the calendar years 2015, when we first recorded investment into the sector, to December 2017.
Key findings
- From 2015 to 2017, Chinese investment in Australia’s healthcare sector totalled AUD 5.5 billion.
- By comparison, Chinese Investment in US’s healthcare sector totalled USD 4.5 billion from 2015 to 2017.1
- Investment is concentrated on Australia’s health supplement and healthcare service delivery sectors, with no major investment in pharmaceuticals, biotechnology or aged care.
- New South Wales has attracted 49 percent of Chinese healthcare investment between 2015 and 2017 to date, followed by Victoria with 45 percent and Queensland with 6 percent.
- Chinese investors are predominantly private companies from diverse backgrounds, including hospitals, specialised healthcare providers, pharmaceutical companies, construction companies and private equity.
- China’s healthcare spending is expected to grow by 8.1 percent annually over the next 5 years.
- Australia’s attractions for China include the digitisation of healthcare services and technical capabilities, management expertise, a stable political and economic environment, and cultural diversity.
Chinese investment in Australian healthcare – Visual report summary
The Australian healthcare sector is well positioned to continue attracting significant Chinese investment. The flow of Chinese capital into the healthcare industry has the potential to increase Australia’s scale and increase the export potential and global reach of Australian brands.
For Australian companies, Chinese investment presents an opportunity to access capital for expansion and new export markets and supply chains.
The outcome of increased investment will be a highly competitive Australian healthcare sector that can accelerate research and continue to improve technological advantages. Increasing the scale in the Australian healthcare industry will benefit both Australian and Chinese consumers into the future.
Footnote
- RHG, Two way street: 2017 update, 2017.
© 2020 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved. Liability limited by a scheme approved under Professional Standards Legislation.
KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.
