Mansoor Ahmed, Director of Healthcare, Education and Public Private Partnerships (PPP), highlighted that “The healthcare sector in the Kingdom continues to evolve alongside the global advancements in technology, research and development. However, the healthcare industry still faces several challenges and hurdles including patient increased awareness of trends and latest treatment methods. In addition to patientcare clearly transitioning to “fee for quality” from “fee for service”
The ongoing changes align with the Governments stated 2030 Vision which emphasises preventative medical care through, amongst others; the promotion of healthy lifestyles and accouraging the growth of private sector competition driving quality and efficiency.
He adds “Based on historical population growth rate of 2.65% per annum, by 2030 KSA will require an additional 50,000 new beds (with current ratio of 2.23 beds per 1,000 population) and over 110,000 bed (with world average of 2.7 beds per 1,000 population) and almost 40,000 more doctors”. Though the Kingdom is moving towards encouraging more private sectors participation in the healthcare market, the key challenge is the extent of investment required, which is estimated to be in the range of USD 11.0 – 17.4 billion (at 2.23 beds) to USD 23.6 – 37.3 billion (at 2.7 beds).”
“One way of bridging the required investment is by creating more REIT funds. We estimate that REIT funds in the Kingdom can unlock around US$7.5 billion to US$ 8.5 billion property value from the private sector, thereby playing a major role in extending the growth in the healthcare sector. In addition to the above, with the foreign investors ownership announcement by the Saudi Arabian General Investment Authority (SAGIA), in which foreign investors can have 100% ownership in healthcare and education sectors, which once implemented, is expected to boost private sector investment in the healthcare sector.”