GCC Offers Immense Opportunities in the Healthcare Sector which is Expected to Grow at CAGR of 12.5% up to 2020

Despite growth, healthcare expenditure is still low compared to the world. High population growth, improved average life expectancy, non-communicable diseases, sedentary lifestyles and health insurance to stimulate the healthcare demand.

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healthcare industry in GCC
healthcare industry in GCC

The healthcare industry in GCC has gained momentum over the past few years, driven by the need to address healthcare service capacity constraints and simultaneously improve the quality of health infrastructure amidst a population that is growing swiftly.

Demographic transition, a rise in the region’s aging population, rapid growth in lifestyle risk factors (a natural consequence of an increase in household income), and the increasing prevalence of non-communicable diseases were and still are the prime reasons for the demand for healthcare.

Major investments in healthcare by GCC countries over the past few decades have resulted in significant improvement in the outcome of the region’s overall health status. The health systems established by GCC states are focused on fulfilling the core public health functions of childhood immunization, food safety, environmental health, and essential child and maternal health services.

In terms of absolute healthcare spending, GCC spent USD64.4bn in 2014 as compared to USD58.3bn in 2013 registering a rise of 10.5% YoY.

Despite growth, healthcare expenditure is still low compared to the world. While, the expenditure on healthcare has increased over the past few years, the level of expenditure is still low when a comparison of different indicators is made with the international community; say for example the percentage of healthcare spending to GDP in the GCC is less than half when compared to the developed countries. It is perhaps because of this that a deficiency exists within the system and that a major expenditure is undertaken by GCC countries on sending patients abroad for treatment.

Among the GCC countries, Bahrain has the highest healthcare expenditure as a % to GDP of 5% for 2014 while Qatar’s healthcare expenditure to GDP was at 2.1%. However, Qatar leads GCC in terms of GDP per capita which stands at a whopping USD96,733 in 2014 whereas the lowest GDP per capita is in Oman at USD19,310. In terms of absolute healthcare spending, GCC spent USD64.4bn in 2014 as compared to USD58.3bn in 2013 registering a rise of 10.5% YoY.

Interestingly, GCC’s average GDP per capita stands remarkably higher than the world average, even almost equivalent to the developed world whereas the healthcare expenses per capita is slightly higher than the world average and markedly lower than that of developed economies which indicates sizeable room for growth in the healthcare industry in GCC. To prove that further, GCC regions also stand far behind the developing world, let alone the developed worlds in terms of healthcare expenditure (government) as a % of total (budgetary) expenditure.

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