Japan’s care providers see business opportunities in the region

Asia is ageing rapidly, but has little care provision outside the traditional family. Providers from Japan, which has the world’s largest proportion of over 60s, see a big business opportunity for nursing care particularly when it comes to dementia, an illness which strikes the elderly hardest.

China, which already has 230m people over 60, is a prime target, particularly because of its one child policy which has left fewer young adults to care for the elderly.

Nichiigakkan, a leading Japanese provider of long-term care, in December opened a nursing home in Beijing for patients suffering from dementia.

The 23-bed facility caters to wealthy customers, with monthly fees starting at Rmb25,000 ($4,000).

The fees cover specialised therapy, including group activities such as cooking and sessions to help residents remember events from their past. The company has based its programmes on similar offerings in Japan.

In China, Nichiigakkan has gone through a period of trial and error. While the company has offered home care there since April 2016, this strategy has failed to generate the expected results, as it remains common in China for live-in housekeepers to handle nursing care. Nichiigakkan suffered losses of ¥1.4bn ($13.1m) at its China operations for the year through to last March.

The company is hoping that demand for residential care for those living with dementia will turn that loss into a profit by the end of the 2019 fiscal year in March 2020. It forecasts revenues will increase to ¥20bn, 10 times their current level, by the end of March 2021. It is set to open another facility in Beijing and homes in the nearby city of Tianjin as well as in Shenyang, capital of the northeastern province of Liaoning.

The company also plans to provide home-care services and day-care facilities near the residential homes so that patients can benefit from different levels of care.

Medical Care Service, another Japanese company, is also aiming at the Chinese market. It opened a nursing home in 2014 in Nantong, in the eastern coastal province of Jiangsu. Now it is set to open a 150-bed facility in Guangzhou — about two hours on the train from Hong Kong.

China is not the only country in Asia with a rapidly ageing population. The number of people aged 60 or over in Asia is forecast to double from 550m in 2017 to 1.2bn in 2050, according to the UN. Dementia patients in Asia and Oceania are expected to more than double to about 70m by 2050, according to Alzheimer’s Disease International.

This helps to explains why Japanese care providers are also looking elsewhere in the region. Home healthcare provider Riei began training Thai caregivers after setting up a Bangkok unit in 2003. The Japanese company opened its first residential care facility on the outskirts of Bangkok in 2016 to meet demand for nursing care.

Caregivers trained by Riei in Thailand are on hand 24 hours a day. Residents, who are mostly Thai locals, are charged a monthly rate of 60,000 baht ($1,900).

But Japanese companies see not only an opportunity to reach new markets but also to bring much-needed caregivers to Japan. Since December, a consortium including Japanese nursing care providers Sakura Community Service and Egao Ichiban have been experimenting with home healthcare in Myanmar’s commercial capital Yangon. Sakura and its partners plan to bring caregivers trained in Myanmar to Japanese facilities through Japan’s five-year foreign technical trainee programme. Afterwards, the staff will be placed in jobs back home. If the arrangement succeeds, it could help ease Japan’s shortage of caregivers while increasing Myanmar’s caregiving expertise.

Source : Financial Times

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