This article originally appeared in China Business Review (CBR), the official magazine of the US-China Business Council (USCBC).

The Chinese healthcare sector, which accounted for 6 percent of the country’s GDP in 2016, is expected to capture a 10 percent share in the coming years. Racing to establish a modern system of coverage, services, and products to accommodate the world’s largest population and fastest growing economy, China faces a number of development challenges. As China increasingly makes use of foreign products, services, and expertise to accomplish its reform goals, foreign companies are in a position to advance China’s reform goals in the healthcare sector, if allowed market access.

Although China’s development goals are broad, the recent release of several sector-specific 13th Five-Year Plans (13FYPs) outline priority themes and targets for China’s healthcare reform through 2020. Seeking to expand the quality and reach of nationwide healthcare while controlling cost, the government crafted a variety of FYPs that promote innovation, research and development (R&D), and entrepreneurship, improve healthcare, hospital, and insurance systems, tackle societal health challenges, and build stronger citizen awareness around health issues.

These plans, which serve as a broad overview of China’s evolving healthcare sector, offer scant details on how foreign companies can contribute to China’s healthcare industry. Instead, foreign companies must continue to reference China’s Catalog on Guiding Foreign Investment (CGFI) and Catalog on Encouraged Imported Technology and Products, as well as specific policies portending national strategy for pharmaceutical and medical device sector development. While foreign technology could contribute to specific reform goals, these catalogs and policies are a guide to market restrictions for foreign firms.

However, in addition to new market opportunities in China’s growing healthcare industry, members will also encounter new and existing regulatory hurdles. Such challenges include China Food and Drug Administration (CFDA) clinical trial requirements that burden foreign companies selling products in China; a new two-invoice policy that limits foreign company negotiating power; pricing restrictions for foreign companies registering new products; and ongoing anti-monopoly inspections focusing on healthcare and medical device companies in China.

Nevertheless, new market opportunities will emerge as China prioritizes enhanced quality of life through an increasingly modern national healthcare system. China has taken an important first step toward reaching these broad medical sector development goals by outlining an array of healthcare industry 13FYPs, investment and import catalogs, and other sector-specific policies. Understanding the targets and trends from these respective documents will position a variety of domestic and foreign firms to help develop China’s complex, yet potential-filled, healthcare market.

To read further about these trends and opportunities, please see USCBC’s newly published healthcare sector report, The Pulse of China’s Healthcare, authored by David Solomon.