Medical device market to benefit from health spending
23 Jan 2024
Malaysia’s medical-device market is forecast to record a high-single digit growth over a five-year period, driven by strong government support for the healthcare sector, medical tourism and an ageing population, according to BMI Research, a Fitch Solutions company.
BMI Research said Malaysia’s 2024 health budget will support the medical-devices market growth by focusing on the procurement of medical equipment, upgrading hospitals and clinics and enhancing system capacity.
Domestic medical-device production will continue to rise as the government prioritises boosting production within key strategic sectors, it said.
The research company projected that Malaysia’s medical-device market will expand at a 2023-2028 compound annual growth rate of 9.5% in local currency terms and 8.5% in US dollar terms, which will take the market to a value of RM16.6bil in 2028.
“Key growth drivers include strong government support for the healthcare and medical-device sectors, medical tourism, a rising elderly population and the growing burden of chronic diseases.
“A downside risk to our outlook for the market is Malaysia’s export-oriented economy and ongoing political uncertainty,” it said.
BMI Research highlighted that the Health Ministry has been allocated RM41.2bil for 2024, a 12.6% rise from 2023’s RM36.3bil.
In 2024, RM5.5bil has been allocated for the procurement of medicines, consumables, reagents and vaccines.
“The government will also prioritise healthcare facilities, including allocations to build new hospitals, and modernising other hospitals and health clinics.
“These initiatives will support Malaysia’s medical-device market growth, improving access to services and ensuring solid demand for products,” it added.
Meanwhile, the firm noted that Malaysia’s exports of medical devices rose by 16.3% in local currency terms to RM18.5bil, while exports expanded by 9.5% in US dollar terms to US$4.2bil in 2022.
“Malaysia’s medical-device exports have recorded growth in local currency terms every year since 2012 with the exception of 2016 and 2020.
“US dollar growth has been more volatile due to a depreciating ringgit in certain years, although growth has been broadly consistent,” it added.