Qatar's private healthcare expenditure is expected to grow at 8.8% in the next 10 years, faster than the 5.8% in public healthcare, offering abundant opportunities especially for global drug manufacturers, according to BMI, a Fitch company.
Highlighting that the healthcare expenditure in Qatar is slated to grow steadily from QR15.4bn in 2016 to QR27.1bn in 2026, it said "this is a moderate 10-year CAGR (compound annual growth rate) of 5.8% in local currency and US dollar terms."
Qatar's public expenditure was about 84% of overall health expenditure in 2016 but as healthcare costs increase rapidly on an ageing population and a rising chronic disease burden, the model of almost-free medical services will be increasingly seen as “unsustainable”, and the private sector is being engaged to share some of the financial burden, it said.
In view of government’s move to delegate some of the health and education projects to private sector, BMI said "we forecast private healthcare expenditure in Qatar to grow at a faster 10-year CAGR of 8 .8% in local currency and US dollar terms, at which point the private sector will account for around 20% of total health expenditure in the country - up from 15% in 20 16."
BMI highlighted that healthcare spending growth is expected to outpace gross domestic product growth over the forecast period, reflecting Qatar's increased focus on the healthcare sector development and rising demand for medical treatment.
"Over the long term, in line with improving healthcare access in Qatar, this will provide greater revenue-earning opportunities for multinational pharmaceutical companies," it said, adding other beneficiaries would include medical devices and infrastructure companies, particularly those specialising in the construction of healthcare related projects.
Expecting several planned health infrastructure projects to go ahead, BMI nevertheless said there is a "moderate risk" of them facing continuous delays as the focus remains "skewed" towards Qatar's hosting the FIFA World Cup in 2022 but the population’s access to healthcare though would not be “significantly” affected by the delays.
Observing that Qatar's 2017 budget includes an allocation of QR24.5bn for the healthcare sector, representing 12.3% of the total allocation, BMI said it represents a small increase on 2016 when the budget was QR20.9bn, corresponding to 10% of total expenditure.
"While this allocation appears relatively low compared to major infrastructure projects for areas including transport, capital investment in primary health services remains high on the government's agenda," it said, highlighting planned healthcare capital projects as the expansion of facilities at Hamad General Hospital; the completion of Sidra Medical and Research Center; the construction of new health centres at Al Karaana, Al Rawda, Al Ghuwariyah, Al Muntazah, Al Naeem and Umm Salal, besides health centres under construction at Qatar University.
"We believe the Qatari government's commitment to healthcare underlines its ambition to maintain social stability in the country,” BMI said.
As part of the country's National Health Strategy, the Supreme Council of Health developed a 20-year blueprint (2013-33) for improving healthcare across the country. The Qatar Health Facilities Master Plan will make up a significant component of this roadmap, responsible for the planning and delivery of new health infrastructure projects, it added.
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