Posted at 4:00 PM
Thank you, Vice Premier Wang for your partnership, your friendship, and your commitment to strengthening the U.S.-China economic relationship. I would also like to extend greetings to Ambassador Cui, Vice Minister Zhang, and my colleagues, Ambassador Froman, Ambassador Baucus, Ambassador Holleyman, and my Under Secretary, Stefan Selig.
Today, I would like to speak about building and enhancing the health care systems in both the U.S. and China. As nations with the world’s two largest economies, we both have the power and the responsibility to provide quality, affordable health care for our citizens.
Cooperating on healthcare, however, is just one element of a far broader commercial relationship between the United States and China. Together, our countries account for nearly 35 percent of global GDP. Our combined trade in goods and services add up to about one-fifth of all international trade. A close and productive U.S.-China commercial relationship, based on responsible partnership, is essential to the growth and stability of the global economy.
As the agency responsible for strengthening America’s economic ties around the world, the Department of Commerce leads the effort to fulfill President Obama’s vision of a more open and market-based trade and investment relationship between the United States and China.
In Seattle last September, President Xi made it clear that he, too, envisions a world of shared responsibilities and deeper commercial relations between China and the United States. “If China develops well,” he said, “it will benefit the whole world and benefit the United States. If the U.S. develops well, it will also benefit the world and China.”
Our leaders want more engagement between our countries, and a relationship founded on mutual interest and respect. They envision that commerce – and our businesses – can lead the way.
That makes the Joint Commission on Commerce and Trade an essential engagement. Working to create the conditions that enable more trade and investment between our countries requires us to not only address issues that inhibit commerce, but also requires us to explore areas of commercial opportunity, including in healthcare, agriculture, and corporate governance.
Last year, Vice Premier Wang, Ambassador Froman and I decided to “reimagine” the JCCT in recognition of the ever-increasing size and scope of the U.S.-China economic relationship. Since the year 2000, our total bilateral trade has grown exponentially, from $116 billion to last year’s $590 billion – a fivefold increase. To put it in perspective, our bilateral trade with China last year was larger than our trade with every country in South America and Africa combined.
We reimagined the JCCT to better address the scale, dynamism, challenges, and opportunities of this unprecedented growth. We changed the way we conduct the JCCT to improve how our countries work together in pursuit of stronger commercial ties, thereby creating new opportunities for meaningful progress.
As part of our refocused agenda, we invited the private sectors of both countries to become partners in the JCCT. We knew we would benefit from their perspective, including their ability to identify the biggest impediments to doing business together and the areas of greatest opportunity.
Over the past year, our JCCT discussions have led to great progress. For example, last year in Chicago, our businesses and governments engaged to boost travel and tourism in both directions, and in September our leaders agreed to declare 2016 the U.S.-China Tourism Year. This morning, our discussions will focus on deepening collaboration between American and Chinese companies, in order to improve the healthcare systems in both our countries.
The fact is, the United States and China each face enormous healthcare challenges, including a growing aging population, the rising prices of medical service and the difficulties of providing accessible, high quality insurance for everyone. Fundamentally, we have to ask ourselves: how do we build and fund a healthcare system that addresses these challenges of rising costs, full coverage, and high quality?
The United States has made progress in addressing these challenges in recent years. President Obama’s Affordable Care Act has improved quality and reduced costs for many patients and providers. It has also provided free preventive care for the insured on most health plans. It has reduced the number of people without health insurance by almost 25 per cent, allowing millions more Americans, including almost 3 million young adults, to access affordable coverage and care.
However, we still spent $2.3 trillion on health care, which is more than 17 percent of our GDP. On the commercial side, productivity losses related to personal and family health problems cost U.S. employers $1,685 per employee per year, or $225.8 billion annually. Clearly, the Affordable Care Act is working, but we have more to do to in the United States to address the challenges of cost, coverage, and quality.
China faces similar challenges – with a serious need for more hospitals, cutting edge technologies and investment from private insurers. Let me give some context to the scale of China’s healthcare needs.
Across China, there are currently1.3 million beds in primary care facilities – and there is a potential market of 1.3 billion people. This mismatch between supply and demand will only become more acute as the country ages.
With respect to technology, for example, there are 2 MRI scanners per 1 million Chinese citizens, which is far below the rate of U.S. and Europe. Limited access to world class technology makes it difficult to provide world class care.
Finally, while the data about health insurance coverage is not clear, we do know that the Chinese private health insurance market is in its infancy. As the central government liberalizes investment in the private health care insurance market, China will see dramatic increases in market competition which will surely result in more Chinese citizens gaining access to high-quality health care.
Further, Chinese officials have stated that they are committed to permitting greater foreign and private investment in hospitals and private health care facilities. Allowing foreign and private investment will not only increase the number of hospitals but will also insure greater access to high quality care.
Similarly, if existing regulations regarding medical device and pharmaceutical approvals are reformed, which happens to be a topic for discussion at this year’s JCCT, more state-of-the art technologies will be available in Chinese hospitals.
American companies are more than ready to support China’s efforts to strengthen its health care system. Chinaco Healthcare Corporation, an American joint venture, has set up private hospitals that serve Chinese and non-Chinese alike. Johnson & Johnson has a significant presence in China, and seeks to design medical devices tailored to the Chinese market. And United Family Healthcare was the first foreign-managed healthcare group in China and currently they operate five United Family Hospitals in China.
Through our Foreign Commercial Service, we have connected U.S. healthcare providers to appropriate health officials in 12 Chinese provinces in an effort to supply more American medical technologies, hospital management, and senior care solutions to Chinese consumers.
These are exactly the type of collaborations we hope will result from today’s discussions, and others, that will take place throughout the JCCT. Through our conversations on subnational cooperation, we believe we can help foster stronger relationships between our cities and municipalities, and our states and provinces that lead to investment opportunities and economic growth in both the U.S. and China. And through our cooperation on agriculture issues at this year’s JCCT, we expect to make progress on food safety and delivery issues that will benefit the people of both our countries.
Our joint challenges are many – but so are our opportunities. I look forward to hearing your ideas, and to working with all of you to craft solutions that benefit our countries, our companies and, most importantly, our peoples. Thank you.