Others News
- Healthcare next for venture capitalists
Date: 29-Jan-2007 Sources: (Shenzhen Daily)
HEALTHCARE is shaping up to become the next big thing for venture capitalists trying to make money on the Chinese economic boom, State media has reported.
While growing amounts of money are channeled into pharmaceuticals and chemical equipment makers, the information technology sector is receiving a smaller share of the nation's venture capital money, the China Business Weekly said.
The paper quoted U.S.-based consulting firm IMS Health as estimating that China's pharmaceutical industry would expand by 15 to 16 percent this year, compared with average global growth of just 5 to 6 percent.
High growth could continue for many more years in China, as its healthcare industry - broadly defined as hospitals, medicine and equipment - is still underdeveloped compared with other nations.
It accounts for about 3 percent of the overall Chinese economy, as against 10 percent in economies such as the United States and Japan, the newspaper said.
Less than 60 percent of all venture capital funds invested in China last year went to IT, compared with 66 percent the year before, the China Business Weekly reported, citing Beijing-based consultancy firm Zero2ipo.
The main reason is that too much past focus on the Internet has driven up valuations, making many potential deals too expensive for venture capitalists, the paper said.
Last year, US$1.78 billion of venture capital funds was invested in China, the paper said, citing Zero2ipo.
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