KUALA LUMPUR: A weakening ringgit can help boost the influx of medical tourists into the country, said Frost & Sullivan.

Frost & Sullivan Asia-Pacific senior vice-president of healthcare Rhenu Bhuller (pic) said healthcare players in the country should promote medical tourism.

“In Thailand, there is political unrest and in Singapore, the strengthening of its dollar has made it a very expensive destination for medical tourism,” she told a media briefing to reveal the results of its “2015 Asia-Pacific Healthcare Outlook” report yesterday.

“Therefore, Malaysian healthcare players should [see] the weakening ringgit [as an opportunity] to [project] the country’s image as a destination for medical tourism,” she added.

The consulting firm noted that local medical tourism generated revenue of RM228 million in 2014, up 18.5% from the previous year.

“Malaysia used to depend a lot on Indonesian medical tourists, but now with Indonesia’s growing healthcare sector, we need to look beyond Indonesia when it comes to medical tourism,” said Bhuller.

According to Frost & Sullivan’s analysis, healthcare expenditure in Malaysia stood at US$12 billion (RM43.20 billion) in 2013, and is expected to grow at a compound annual growth rate (CAGR) of 11% until 2020.

“The impending goods and services tax will have an impact on healthcare costs, but it will not be the only factor contributing to its increase. There is also the consumption of healthcare services itself as the rates of chronic diseases [among Malaysians] is not going down,” said Bhuller.

She said import costs for medical devices will also add to healthcare expenditure in the country.

According to the Frost & Sullivan’s report, in 2013 the Malaysian healthcare industry spent US$1.35 billion on medical devices, of which US$1.17 billion or 86% comprised imports.

The local medical device market is forecast to grow at a CAGR of 16.1%, said Frost & Sullivan.

“The weak ringgit will [raise import costs for healthcare players] in the country. This is why it is important for Malaysian medical device manufacturers to strengthen their position [and market share], and in turn become the exporters of medical devices,” said Bhuller.

On the growth of the private hospital market in the country, Bhullar said: “Overcrowded public hospitals, urbanisation, diseases,lifestyle trends, increasing private health insurance coverage and awareness of the importance of health management will see the private hospital market in Malaysia grow at a rate of 9.6% between 2015 and 2020.”

This article first appeared in The Edge Financial Daily, on January 23, 2015.