By Adedapo Adesanya
Global research firm, Agusto & Co, has forecast that an increased foreign interest will drive growth in Nigeria’s healthcare system, especially through the acquisition and establishment of health facilities in the medium term.
Agusto said in a report that these foreign investments would help the country bridge the healthcare infrastructure deficit estimated at $82 million.
According to data, Nigeria is largely underfunded in terms of its health system and, as a result, is faced with a significant infrastructure gap.
The industry is currently challenged by outbound medical tourism, deteriorating medical infrastructure, low government budget allocation, and poor compensation for public healthcare workers, all of which have prompted many skilled medical practitioners to relocate overseas in search of better employment opportunities.
In addition, brain drain is also contributing to this as approximately 2,000 doctors leave the country each year, and at least 266 Nigerian doctors were licensed in the United Kingdom between June and July 2022, according to the National Medical Association (NMA).
Nigeria has also not been playing its part, with the health sector receiving only about 4 per cent (N546.98 billion) and 5 per cent (N724.6 billion) of the total budgetary allocation in Nigeria’s 2021 and 2022 budgets. This undershoots the 15 per cent expected by the World Health Organisation (WHO) and African Union (AU).
Agusto noted that the emergence of COVID-19 in 2020 saw an increase in diagnostic facilities and, albeit insufficiently, an increase in public investments in the health sector with efforts from the Central Bank of Nigeria (CBN).
Despite this, there remains more to be done, especially with the country’s large population facing a high burden of communicable and non-communicable diseases, resulting in many people constantly seeking treatment.
Foreign investors have found the Nigerian healthcare system to be an attractive investment opportunity, and in 2021, the healthcare industry attracted around $2.3 million in foreign direct investments (FDI).
For instance, in February 2021, Evercare Group, through its emerging market health fund, established Evercare Hospital Lekki, a 165-bed multispecialty tertiary care facility.
Agusto predicts that the industry’s contribution to gross domestic product (GDP) will reach N480.6 billion by 2022 from N470.5 billion, based on the country’s high birth rate and the spread of communicable diseases as well as other common ailments such as malaria and respiratory tract infection.
It also expects that a lower rate of outbound medical tourism, as a result of the naira’s continued depreciation, will boost the industry’s contribution to GDP in the medium term.
