Saudi Arabia and Kuwait - Improving Healthcare

Ian Watson
Governments in the Middle East are stepping up to the challenge of delivering much needed social infrastructure. In a departure from the predominantly real estate focus of previous years, the GCC countries are currently investing in housing, healthcare and education for their young and growing populations.

Both Saudi Arabia and Kuwait are exploring ways of improving and investing in their social infrastructure. The Middle East is seeing huge investment in its healthcare sector. Increasing life expectancy, together with the Middle East’s high prevalence of non-communicable diseases such as cardiovascular disease, diabetes and obesity, are putting considerable pressure on existing systems of care. Preventative and primary care are therefore seen as priority areas for the future.

A number of international healthcare providers are interested in moving into the buoyant Saudi market to capitalise on the growing middle class and to provide an alternative to Saudi’s going overseas for ‘medical tourism’.

In Saudi the Ministry of Health covers more than 60 per cent of healthcare expenditures and is encouraging more private sector involvement by providing grant assistance through the Ministry of finance to private healthcare companies. A number of international healthcare providers are interested in moving into the buoyant Saudi market to capitalise on the growing middle class and to provide an alternative to Saudi’s going overseas for ‘medical tourism’. In Kuwait the healthcare sector is undergoing rapid expansion, with the government currently spending an additional US$178 million to upgrade existing hospitals.

Governments in the Middle East are increasingly turning to the private sector for support in developing and delivering large scale projects. There is huge potential and growing appetite for Public Private Partnership (PPP), which has to date been popular in the services and utilities sectors. Both Kuwait and Saudi are now exploring ways of mobilising PPP to develop their social infrastructure.

There are a range of economic, social and political motivations for developing PPPs including the sharing or apportionment of risk, the integration of specialist skill sets, culminating in improved efficiency, as well as the provision of a recognised investment vehicle conducive to the attraction of private sector investment.

PPP also promotes knowledge transfer to the local economy and Kuwait in particular is actively keen on this.

The Middle East impetus is less funding-related and more focused on PPP’s key role in delivering projects more efficiently. PPP also promotes knowledge transfer to the local economy and Kuwait in particular is actively keen on this. The long-term commitment from international and local companies is critical to develop PPP facilities and operate them successfully. Like other countries that have achieved success with PPP, the Middle East will need to build its own specific PPP models based on local requirements.

Faithful+Gould is active in both Kuwait and Saudi Arabia, where we anticipate growing demand from government ministries for support in their capital investments programmes. In Saudi we are based in Riyadh, Jeddah and Al Khobar.