China's current way of doing business is sometimes called “capitalism with Chinese characteristics” because companies there are now state or individually owned, or a combination of both. This combination of East meets West has brought China close to its goal of becoming a major global player in medical manufacturing. Perhaps nowhere was this more evident than at the recent Chinese Medical Equipment Fair (CMEF) tradeshow in Schenzen, China, which attracted over 50,000 attendees, 20% of them international, and included exhibitors from around the world with products and services for the entire medical-supply chain.

Much of China's increased economic activity in medical manufacturing has come about because of the recent Rural Health Initiative passed by the Chinese Ministry of Health. The stimulus package provides billions of dollars to build roads and improve the infrastructure in rural China, with the goal of boosting healthcare in those areas. Once this is done, it is said that the country intends to revert to a new kind of communism.

Exhibitor Yuyue, a Chinese manufacturer of medical diagnostic equipment, provided one of the most interesting examples of a company that blends the old and the new for economic success. Listed on the international stock exchange, the firm reports it has been growing at an annual rate of 20% for the last three to five years. The company logo is a fish head, symbol of a “fish jumping through the dragon gate.” According to a company spokesperson, the first Chinese character of this phrase signifies “the achievement of a better state.” The firm is assessing the U.S. market and is soon to change its name and logo to better target this market.

Now privately owned, exhibitor Perlot Group, which designs and manufactures imaging equipment, was state-owned until 2000. President Liu Jinhu did not hesitate to admit that the main appeal of the company's products is low price. He says that in the past, the company turned out less-expensive versions of existing Chinese products. Now it does this for global companies like Siemens, GE Health, and Phillips. The firm's inexpensive products target the rural Chinese healthcare market.

Although Perlot doesn't yet sell to North America, it exhibits at U.S. trade shows such as AACC, an annual radiological show, as homework for eventually penetrating the U.S. market, as well as opening a pipeline to future business with Mexico. Jinhu says that before 2000, the firm had no international visitors at CMEF. Now, it needs three translators just to keep pace.

Carestream Health, an international company with a unit in China, says it works with the Chinese government to develop digital technology that will help bring health care to the over 900 million people living in rural China. Currently, developed areas of the country use mostly film-based imaging equipment. But the lack of roads in remote areas makes it difficult to service the equipment. The company first developed its digital remote-hosted information systems in Europe, and makes and sells them in China (as well as to customers in the U.S., Europe, and other parts of Asia).

“Ten years ago, cultural differences between East and West made it hard it manufacture in China,” says Carestream CEO Kevin Hobert. “Chinese employees had different ideas than Western workers on the importance of meeting deadlines. They also had difficulty making decisions without direction. But now there are no differences in accountability, commitment, and feelings of empowerment,” he says.