KUALA LUMPUR (June 18): BMI, a Fitch Solutions company, has forecast Malaysia’s health expenditure to grow at a compound annual growth rate (CAGR) of 8.3% from 2023 to 2028, with public expenditure growing by 8.5% and private expenditure by 8.1%.

It said the positive outlook is supported by double-digit increases in the government’s healthcare budget in 2023 and 2024, alongside continued advancements in the private sector.

“This will make Malaysia’s medium-term health expenditure growth to be among the fastest in Asean,” BMI said.

An ageing population, growing burden of chronic diseases, as well as efforts to enhance public health infrastructure and improve access for underserved communities will drive public sector growth.

“Private healthcare providers will continue to attract patients with higher incomes, including medical tourists and domestic patients looking to avoid long waiting times, amid Malaysia’s shortage of physicians and nurses,” BMI said. 

It noted that Malaysia’s high single-digit expenditure growth will see it outpace regional peers such as Singapore, Thailand, the Philippines, and Indonesia over the medium term.

“Annual per capita health expenditure remains above global and emerging market averages, indicating strong capacity for spending on advanced medical products.” 

Meanwhile, BMI said Malaysia will continue developing its healthcare offerings to attract medical tourists, but will face strong regional competition from Thailand and Singapore.

It expects partnerships to remain a feature of Malaysia’s efforts to enhance its medical tourism industry, as it seeks to remain competitive amid strong regional competition.

The country will continue to address accessibility challenges in rural areas, with the government’s 2024 budget highlighting investments in health facilities, including expanding hospitals and building new health clinics to increase capacity and reduce overcrowding.

“The Malaysian government is also aiming for a nationwide roll-out of electronic medical records by 2026, in a bid to improve the efficiency of the healthcare system,” BMI added.

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