The Hanoitimes - UK-based research firm BMI forecasts that healthcare spending will grow to US$22.7 billion in 2021, recording a compound annual growth rate (CAGR) of approximately 12.5 percent from 2017 to 2021.
The Vietnamese health-care market is forecast to heat up in the coming time when more big investors are showing interest in the sector while private hospitals are promoting high-quality services to enlarge the share.
After the investment of the country’s largest private company Vingroup in the health-care services sector with the establishment of Vinmec hospitals in seven cities and province across the country, the local market has recently continued to see FLC Group, a resort conglomerate, begin the construction of a VND3.72 trillion (US$159.78 million) international hospital in the northern province of Thai Binh.
Vingroup has seven hospitals across the country
According to FLC Group, Thai Binh International General Hospital will be the largest in the province with the accommodation of 1,000 inpatients. The hospital, which will be part of a larger 12-hectare complex including a hotel, will first start operations in 2022 with 500 beds.
FLC CEO Huong Tran Kieu Dung said that the hospital will be the first in a chain of large-scale hospitals that the group plans to build in different parts of the country in the coming years.
"We aim to increase our competitiveness in manufacturing and distributing medical products and health services to create a high-quality medical system that the government has demanded," she said.
With the government’s policies to encourage medical privatization to reduce the burden on public hospitals and improve the quality of the country’s healthcare services, investment in the healthcare sector, especially in the high-end segment, is forecast to continue rising.
The participation of new players will make competition in the market fiercer as many private hospitals, including foreign-invested ones, are also increasing investment for high-quality healthcare services to gain the share in the potential market.
Hoan My Medical Corporation, for example, last year decided to acquire Hanh Phuc International Hospital in the southern province of Binh Duong. The investment has helped it lead the private hospital system in terms of high-quality healthcare services.
After the acquisition, Hoan My will focus not only on international obstetrics and pediatrics, but also international polyclinics due from this year, said Huynh Le Duc, general director of Hoan My Medical Corporation.
Eng Aik Meng, chairman of the Singapore-Vietnam Cancer Center, said that there remains large room for private healthcare providers to operate in Vietnam.
He said the outlook for foreign investors in the healthcare sector is positive as Vietnam’s population is ageing quickly, with the elderly accounting for one-third of the total population in the next 15 years.
Besides, the rapid urbanization is stimulating demand for quality healthcare within Vietnam while overcrowding in public hospitals is expected to intensify, resulting in long wait time and a shortage of beds, he said.
According to experts, economic growth and demographic changes are driving demand for healthcare services throughout Vietnam, and not just in the two economic hubs Hanoi and Ho Chi Minh City.
UK-based research firm BMI forecasts that healthcare spending will grow to US$22.7 billion in 2021, recording a compound annual growth rate (CAGR) of approximately 12.5 percent from 2017 to 2021.
A report on Vietnam’s private equity released by Grant Thornton also showed that in Vietnam, healthcare and pharmaceuticals ranked third in terms of industry attractiveness for investors, which was voted by 38 percent of participants as “very attractive”.
The demand for healthcare and safety has been increasing in line with customer’s awareness of health problems. Thus, the call for multinational businesses providing health related services are critical with the need for long-term investment, according to the report.