Quality health facilities in Kenya are limited and concentrated in the country’s capital, Nairobi. Although there are private hospitals that offer great services — and have specialized equipment — their fees are too high for many. With Kenya’s health facilities unable to keep pace with the demands of its rising population, the shortage is translating into huge opportunities for potential investors.
These opportunities exist in virtually all areas of the medical world, including inpatient and outpatient care, preventative care and diagnostic services. However, it’s a stable government, economic reforms and a large pool of skilled workers that attract potential investors.
Strained Health Services
Kenya’s weak provision of public health services and increased constraint of health resources have opened a gap for private enterprises to step in and fill. Other factors placing a strain on services include poor remuneration of health personnel and the growing affluence of the country’s middle class. Lifestyle diseases have been rising, stretching existing facilities to the limit.
Recent reports indicate that congestion at the Kenyatta National Hospital, the largest referral hospital in the country, has now reached a worrying level.
The most affected are the orthopedic ward and accident and emergency departments. The orthopedic section is supposed to hold 32 patients, but holds up to 110.
The hospital communications officer, Simon Ithae, says that provincial and district hospitals could play a role to ease the hospital’s patient load. Ithae believes these health facilities have the potential to offer equivalent and quality services.
“We have long queues of patients. Our cardiologists are currently booking patients for the year 2015,” Ithae said.
Government and Public-Private Partnerships
The government is currently working on a health sector public-private partnership strategy — created to allow private investors to get a share in the management and control of public hospitals. It also proposes that private investors get returns on their investments, but at a rate that does not hamper the operations of these facilities. The majority of these are manned by the government, with private enterprises being in charge of 34 per cent of Kenya’s 6,190 health facilities.
Speaking during the opening of Wesley Mission Health Center — which is modeled on the new government strategy — Nakuru County deputy governor Joseph Ruto advocated for a concept that benefits patients.
“We are ready for public-private partnerships (PPPs) to build more health centers as close to the people as possible,” Ruto said.
Opportunities associated with the new government health plan include telemedicine, sharing of medical resources and local manufacture of generic drugs. The Nakuru County government says it aims to develop better health facilities through this strategy.
Manufacturing and Pharmaceutical Markets
The health sector also offers opportunities in manufacturing of medical equipment, such as electro-medical equipment.
The pharmaceutical market, too, is rapidly booming. Kenya is the largest producer of pharmaceuticals in the Common Market for Eastern and Southern Africa (COMESA) market. The region is estimated to have 50 recognized pharmaceutical manufacturers, 30 of which are based in Kenya.
Kenya supplies up to 50 per cent percent of the region’s market, giving the investor a great deal of opportunity. They can also export their products to the other four members of the East African Community – Uganda, Tanzania, Rwanda and Burundi.
The Kenya Industrial Property Bill (2001) allows for importation and production of affordable medicines for HIV/Aids and other diseases. Kenya’s unique geographical features also offer excellent investment opportunities in health tourism. The country has plenty of geothermal mineral water springs located in arid and semi-arid areas within Baringo and Turkana districts in the Rift Valley. Parts of Homa Bay District on the shores of Lake Victoria have springs, too. Spas can be constructed in these areas as recreation facilities and curative centers.
Medical Tourism
Medical tourism in Kenya remains largely unexploited, offering vast potential for investors. Moreover, the health sector suffers from lack of medical equipment and skills in operation and maintenance. Providers of specialized diagnostic services including DNA tests, MRI, nuclear and radiology services are also in great demand.
The Kenya Investment Authority is responsible for assisting investors to obtain the necessary licenses and permits, incentives and exemptions under various laws and regulations.
Regulatory bodies in health include the Ministry of Health, the Medical Practitioners and Dentists Board, the Central Board of Health, and the Clinical Officers Council. Others are the Nursing Council of Kenya, the Pharmacy and Poisons Board and the Ministry of Local Government.
Health investors have neither foreign exchange controls nor capital repatriation restrictions. Remittance of dividends and interests are guaranteed to foreign investors.