Saudi private healthcare providers are likely to gain from high demand due to population growth, according to S&P Global
Saudi Arabia’s private healthcare services are expected to grow a lot because of population growth and the Saudi Vision 2030 plan. By 2030, the country will need about 30,000 more hospital beds.
High Demand
From 2024 to 2027, the population is expected to grow by about 3% each year, according to a report from S&P Global released on Friday. This growth will boost the economy, especially in areas outside of oil.
More than 70% of Saudi Arabia’s population is under 40 years old, which means that in the future, there will be more older people. Since people are living longer, the need for healthcare will increase, according to the report.
The growth in demand for private healthcare is also supported by government programs and required health insurance.
Investments
The growth of private healthcare in Saudi Arabia will need more money, which is easier now since the Saudi Council of Ministers approved a privatization law in March 2021.
How much healthcare capacity will grow depends on local demand, which is different in each city. In Riyadh, demand is driven by population growth and economic development, with a goal of reaching about 10 million people by 2030.
In Jeddah, the need for healthcare is linked to development and rebuilding projects, with around $90 billion (SAR 338 billion) planned for investment by 2030. In Makkah and Madinah, demand comes from religious tourism. The government wants to increase capacity to serve 6.7 million Hajj pilgrims and 30 million Umrah pilgrims by 2030.
As of 2022, there were about 78,500 hospital beds in Saudi Arabia, according to Statista. Most of these, around 20,500 beds, were located in Riyadh.
Digital Innovation
Alpen Capital says that digital technology and teamwork between public and private sectors have significantly affected healthcare spending in the Gulf Cooperation Council (GCC) countries.
In 2023, Saudi Arabia invested more than $50 billion in various projects, including digital health services, to make healthcare more efficient, accessible, and transparent.
A report from McKinsey highlighted that using digital healthcare solutions more widely could bring an additional $15 billion to $27 billion in benefits to Saudi Arabia’s health system by 2030.
Published: 15th October 2024
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