AIDS is likely to cause nearly $US40 billion in losses for China's economy over the next five years, mostly because of lost labor as patients die or fall sick, according a state media report.

Xinhua news agency reports the economic loss is estimated to reach $US36 billion between 2006 and 2010.

Quoting health ministry statistics the report said millions more was likely to be lost as a result of reduced productivity in the agricultural sector.

The predicted losses account for less than 0.3 per cent of China's expected accumulated gross domestic product for the coming five years.

An estimated 650,000 people had the HIV virus in China at the end of last year, according to a study carried out by the health ministry, the World Health Organisation and UNAIDS.

The study, released in January, said there were between 60,000 and 80,000 new HIV/AIDS cases and an estimated 25,000 deaths in 2005 alone.