An employee is seen at work in a medical equipment enterprise in Lianyungang in East China's Jiangsu Province on Monday. Lianyungang aims to build its biomedical industrial park into a world-class pharmaceutical and medical hub by speeding up the development of a mature industrial chain. Photo: cnsphoto

Chinese technology companies such as Huawei and YITU Tech have started developing medical equipment, a move analysts said is of significance for the world because their technology prowess will help improve research into new medical solutions, while reducing prices.

On Wednesday, Huawei Investment and Holding Co established a company in Shenzhen, South China's Guangdong Province, with a registered capital of 300 million yuan ($42.27 billion). CEO of Huawei Consumer Business Group Richard Yu Chengdong is the new firm's chairman.

The venture will be involved in the R&D, manufacturing and sales of medical products like face masks, personal protective equipment and other vital medical supplies, according to business data provider Tianyancha.

Huawei's move into the medical sector is meaningful for the whole world, as the company's experience in information, big data and cloud computing can complement traditional medical equipment makers' weakness in the information era, Xiang Ligang, director-general of the Beijing-based Information Consumption Alliance, told the Global Times on Thursday.

"For example, Huawei's big data technology can be used to screen whether a CT image shows a person has coronavirus," he said, noting that Huawei is also able to produce ventilators as the technology is proven. 

A handful of other high-profile technology companies in China have entered the sector. On Monday, the healthcare subsidiary of Shanghai-based AI startup YITU Tech expanded its business scope to include sales of medical products like masks and protective outfits. It has obtained a license to produce other vital medical equipment.

New-energy vehicle (NEV) producer NIO is expanding into healthcare products, including appliances for labor protection and disinfectant.

These companies' expansion comes amid a severe global shortage of most medical products due to the COVID-19 pandemic. Lu Zhenwang, founder of Shanghai Wanqing Commerce Consulting, told the Global Times on Thursday that even after the onslaught of the virus, most countries will need to source medical products.

NEV maker BYD recently told the Global Times that on February 8, it diverted part of its production line to the manufacturing of masks and disinfectants. Daily production capacity is five million masks and 300,000 bottles of disinfectant. It has a dozen mask production lines which need about 1,300 components, 90 percent of which are made by the carmaker itself.

"Currently, many foreign multinationals dominate the manufacturing of high-end medical equipment, but if more Chinese companies join the competition, I believe the price of these products will soon drop," Xiang said, noting that China's manufacturing capability and efficiency has been showcased during the ongoing COVID-19 pandemic.

From February 1 to Monday, more than 28,000 companies in China have developed new businesses relevant to masks, disinfections, protective outfits and other medical products, according to business data provider Tianyancha.

Currently, there are 4,706 forehead thermometer manufacturers in China, with 984 newcomers since February, up 1,993 percent compared with the same period last year.