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Demand for healthcare in Saudi Arabia is set to grow, supported by a demographic shift and an increase in health insurance coverage, Knight Frank said in a new report.
"In Saudi Arabia, rising demand for healthcare and government initiatives favoring an increased participation from the private sector look set to drive expansion in the sector and open new doors for investors," the consultancy noted.
Population dynamics are forecast to shift, with population between the ages of 40 and 59 increasing by 1.5 times and population over the age of 60 increasing more than three times from 2017 to 2035, increasing the demand for health services and broaden the requirement for specialist care.
“Over the next decade, population dynamics are forecast to shift, with a significant increase in the population over 40,” said Dr Gireesh Kumar, Senior Manager, Healthcare, Knight Frank.
“This indicates an expected increase in the burden of lifestyle diseases and the associated co-morbidities which would trigger an upsurge in demand for highly specialized medical and surgical care in the Kingdom.”
To keep pace with population growth, Saudi Arabia will require an additional 5,000 beds by 2020 and 20,000 beds by 2035, based on the current density of beds.
The Kingdom faced a gap of 14,000 beds in 2016 and this gap is expected to widen to 40,000 beds by 2035 based on the global average of bed density, the report said.
In the context of growing healthcare demand, Knight Frank said that government initiatives call for a greater participation of the private sector in healthcare as highlighted in the National Transformation Plan (NTP) and the recent privatization plan.
"Private investment in healthcare is being guided by the Saudi Arabian General Investment Authority (SAGIA). We can expect to see further changes to regulatory controls in order to achieve the goal of increased private sector involvement and investment while ensuring a suitable regulatory framework for the upcoming privatization waves and PPP schemes within the healthcare sector," it noted.
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