Myanmar woos Indian investors in bid to support healthcare sector

Myanmar is stepping up efforts to draw much-needed investments into its healthcare sector. During a Market Outreach Programme hosted by the Export-Import Bank of India on Monday, the country sought to promote opportunities and discuss the challenges involved in expanding the sector. The event was attended by Indian investors and healthcare professionals.

With demand for private healthcare services on the rise, the sector has been identified as a priority sector for investments by the government of Myanmar. India, with its proximity to Myanmar and skills in pharmaceutical production and hospital management, is seen as a promising investor in the sector at a time when hospitals, medical equipment and services and skilled doctors and nurses are in short supply.

“Indian investors stand to add much value to the local healthcare industry,” said Dr Kyaw Zin Thant, Director General of the Ministry of Health & Sports. “We have increased our public spending in the healthcare sectors by 10 times in 2017-18 compared to 2011-12 but the Myanmar healthcare system still faces many challenges such as the lack of skilled human resources, physical infrastructure, medicines and services and health financing.”

The good news, though, is the Ministry of Health & Sports has committed to strengthening the healthcare system and achieving universal health coverage following the successful adoption of the Myanmar National Healthcare Plan from 2017-2021.

“Right time to invest”

The move to draw investors from India also comes after both countries last September signed an MOU to cooperate in the field of health and medicine. Under the agreement, India will provide training for local medical professionals, provide assistance in human resource development and hospital management and provide input in the drawing up of regulations for trading in pharmaceuticals and medical equipment.

Now, more direct investments are needed as public hospitals in Myanmar come under pressure from rising constraints and demand for private healthcare rises. According to statistics provided by Dr Aye Aye San, who represented the Myanmar Private Hospitals Association during a panel discussion at the event, there is currently less than one bed available to every 1,000 patients in Myanmar, while the ratio of doctors to nurses is 1:1 compared to at least 1:3 in neighbouring countries.

Meanwhile, Myanmar patients are now spending close to $6 million seeking medical treatment abroad due to the lack of hospitals specializing in cardiology, neurology, kidney transplants and urology. According to Dr Thein Aung, chair of Parami Hospital, a total of 150,000 Myanmar patients now seek medical treatment in Thailand and Singapore.

“In Myanmar, things are moving slowly towards acceptance of a private healthcare system. In the past, we were under a socialist system where private hospitals were not common,” Dr Thein Aung said during discussions.

“Now, allocation of the national budget towards developing a public and private healthcare system is 5pc of GDP compared to 1pc before. Meanwhile, more and more people are using private hospitals and there is a need for quality healthcare. So, it is the right time to invest,” he added.

Investment opportunities

Among the areas most in need of investments is physical infrastructure, which includes hospitals, specialist centers and clinics. “There has been a shift in medical outbound tourism to building internal capacity for providing healthcare services. We need investments to build healthcare facilities here that are affordable for the middle and lower-class,” said Dr Venkatesh A R, who runs Global Pharma Healthcare, an Indian pharmaceutical company.

By his estimates, 10-12 new hospitals are launched across Myanmar every year by overseas investors from Singapore and Thailand in cooperation with local investors. “But procedures such as MRI scans cost $4,500-$5,000 each compared to $700-$800 in India. There is a lot of potential for Indian service providers to meet the needs of middle-class patients,” Dr Venkatesh said.

“There is also the need for healthcare system software programs for better hospital management as well as healthcare apps that help general practitioners remotely monitor the medical records of their patients,” he added.

Mr Edwin Wanderbruggen, a partner at law firm VDB Loi, pointed out that under the new Companies Law, foreign pharmaceutical companies can now form joint ventures with local firms to import and distribute drugs and other pharmaceutical products.

He warned though that “it could be a problem if you are a 100pc foreign-owned hospital and cannot distribute drugs or medicines, which is an integral part of running a hospital.” Under the current law, foreign-owned hospitals are allowed to operate without a local JV partner in Myanmar. Meanwhile, foreign laboratories and medical equipment providers, both of which are in short supply, are also permitted to operate under full foreign ownership in the country,” Mr Wanderbruggen said.

Lack of insurance, HR

Another big opportunity is in the provision of health insurance. “In Myanmar, 80pc of all healthcare-related expenses is borne out-of-pocket, which is a huge burden for families,” said Dr Aung Tun Thet, senior economist and member of the Myanmar Investment Commission. “There is a huge shortage of proper health insurance policies in Myanmar. So, if we can bring the best practices on insurance from India into Myanmar, that would be a big help.”

Dr Venkatesh agreed. “There is a huge lack of health insurance policies for the middle-class and private enterprises are also finding it difficult to get proper health coverage for their employees. Hospitals can help by offering affordable health packages to the middle –class, which will likely be a successful investment,” he said.

Still, the most acute of all the shortages is in human resource. “Now, the private sector is relying on specialists, doctors, nurses and technicians from the public sector as well as overseas. But it is not enough. This is a major challenge for the private sector,” said Dr Thein Aung. “Investors have to look at training and developing skills in Myanmar. India can help.”

Source: Myanmar Times

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