Opinion: To good health: The importance of medicine to a developing economy
Guest commentary by Chen Jiahe
Though China is the world's second largest economy, it is still considered a developing country and ranks only 71 out of 187 nations in per capita GDP in 2017, according to data compiled by the International Monetary Fund (IMF). 
In line with the middle-level per capita GDP, China’s per capita total health spending was 426 US dollars in 2015, ranked 82 among 189 countries as shown by data from the World Health Organization (WHO). As a comparison, the United Kingdom, France and Japan had a per capita spending of 4,356 US dollars, 4,026 US dollars and 3,733 US dollars respectively in the same year. There is indeed a long way to go for China’s health care system.
However, it is not always the case that the more money a country spends on health care, the better the outcomes. For example, the United States spent 9,536 US dollars per capita in 2015, more than two times of Japan. But the life expectancy of the US was 79.3 in 2015, 4.4 years lower than Japan’s 83.7 (all data above were calculated by WHO).
If we take life expectancy as a good gauge of what has been achieved by a country's health care system, China has done a pretty good job. Average life expectancy at birth was 76.5 years in China, ranked at 53 out of 183 comparable countries, according to WHO. This data is only 2.8 years lower than the United States, while China has merely around five percent of per capita total health expenditure compared with the United States, calculated on an international currency basis.
Scientist taking a sample out of a petri dish using a pipette / VCG Photo

Scientist taking a sample out of a petri dish using a pipette / VCG Photo

The level of social stability might be a way to explain the above data. According to the United Nations Office on Drugs and Crime (UNODC), China had an intentional homicide rate of 0.74 out of 100,000 inhabitants in 2014, while the data is 4.88 for the United States in 2015, 6.6 times of China. While the spending on health care prevents people from natural death, it has little to do with murders (especially by guns).
Regular exercise and healthy eating habits are also another contributor to a person's well-being. According to WHO, in 2015, Russia had the largest gap between female and male regarding life expectancy at birth, which was 11.6 years. On average, Russian females live 76.3 years, but Russian males live only 64.7 years.
This is largely because Russians drink an excessive amount of alcohol, which is clearly stated by the International Agency for Research on Cancer (IARC) as a group one carcinogen. According to WHO, in 2010, Russians above the age of 15 consumed 15.1 liters of pure alcohol per capita, ranked 4 out of 191 countries.
Another reason that might strongly affect the health of people is the level of pollution. Famously known as the “world’s factory,” China does not yet have a good environment. The country is working hard on this issue. The importation of wasted items has recently been banned, and air pollution has gradually decreased in the past few years. A better environment can improve people’s health status, which requires no added health expenditure.
Liquid bottle filling production line / VCG Photo

Liquid bottle filling production line / VCG Photo

Although other social and environmental factors come into play, health expenditure is still a significant factor that influences peoples' lives. 
China recently announced a new policy that it will exempt import tariffs on all cancer medicines.Currently China is a small and weak pharmaceutical industry compared to developed countries. Therefore, the importation of medicine is still very important for China’s health care system.
Some people worry that this elimination of the tariff might hurt innovation in China. However, consider the fact that technically speaking, domestic Chinese companies are still far away from the world leading pharmaceutical companies like Pfizer and Merck, therefore that level of competition has not yet been formed between Chinese companies and their international counterparts. As a result, the elimination of tariff will hurt China’s domestic companies very little at this stage.
Living healthily is a vital important part of economic development, and China is walking toward the correct direction of achieving this through the building of health care industry, the stabilizing of society and the purifying of the environment. It is quite certain that in the future, Chinese people will enjoy a healthier life when the country’s per capita GDP reaches a level that is now enjoyed by developed economies.
(Chen Jiahe is the chief strategist at Cinda Securities, Oxon. The article reflects the author's opinion, and not necessarily the views of CGTN.)