China to allow pvt capital in many sectors to boost economy

In a major reform push, China today said a slew of measures, including permitting private capital to build hospitals, in healthcare, education, culture and tourism, would be taken to halt the slowdown of the world's second largest economy.

Private capital is encouraged to invest in nursing homes, cultural and tourism industries, healthcare facilities and educational institutions, Xu Shaoshi, head of the National Development and Reform Commission (NDRC), China's top economic planner, said today.

In China, healthcare, including hospitals catering to over 1.3 billion people are largely controlled by the government putting enormous pressure on the state resources.

There is also seething discontentment among the medical fraternity over the low wages besides dissatisfaction among the people over the medical costs as well as poor facilities.

Observers say that opening up of China's health sector could pave way for top international hospital chains, including India's well established corporate hospitals, to enter world's biggest healthcare market.

Also education as well tourism sectors were tightly controlled by the government and their opening could result in major investment opportunities.

The Chinese authorities agreed to continue to coordinate the tasks of stabilising growth, restructuring the economy and promoting reforms, he said.

In the next step, the government will "waste no time" in introducing more reform measures to stimulate the economy, Xu told state-run Xinhua news agency.

The "to do list" includes reforms in the fiscal, tax and financial sectors, as well as railway investment reform and price reform of resource-based products.

Xu said despite the slowdown of economy, China has the capability to achieve the government's annual economic growth target of 7.5 per cent this year.

But "to achieve this goal, we still have to make arduous efforts," Xu said.

China's economy has been stuck in a protracted slowdown, easing to 7.5-per cent growth in the second quarter from 7.7 per cent in the first three months.

Worries are growing that the prolonged slowdown could affect the global economy.

Playing down the impact of the slow down, the politburo of the ruling Communist Party of China yesterday pledged to keep the economy growing steadily in the second half of this year, amid "extremely complicated domestic and international conditions".