Africa’s healthcare sector suffers from a lack of financing due to a rudimentary and unprofitable ecosystem. However, investment opportunities do exist. Five African countries: Morocco, Nigeria, South Africa, Egypt, and Kenya are showing notable progress in this area.

Economic landscape of the healthcare sector in Africa

Africa bears 25 % of the world’s disease burden but has only 3 % of the world’s medical personnel. Insufficient and underdeveloped health infrastructure further hampers the industry’s development. In the sub-Saharan region, the quality of medical care is often mediocre, and low purchasing power limits access to better services. This reality discourages investors.

Growing demand for medical products

The Covid-19 pandemic has underscored the critical need for Africa to locally produce vaccines and other medical products. The rise of the middle class and rapid urbanization are driving increased demand for healthcare. With higher incomes, spending on healthcare services and products is rising, alongside expenditures on meals and entertainment. Urban lifestyles, often sedentary, are also contributing to a higher incidence of non-communicable diseases, further boosting demand for medical products. By 2030, one in five global consumers will be African.

Persistent challenges for the healthcare industry

Despite the efforts of many African countries, access to healthcare and health insurance remains challenging. Most nations are unable to afford the recommended 34 to 40 USD per capita expenditure on health as suggested by the World Health Organization (WHO). Currently, only 3.7 % of African GDP is allocated to healthcare.

The African diaspora contributes billions of USD annually, yet the effective utilization of these funds remains uncertain. Additionally, the shortage of qualified healthcare professionals worsens the situation, with the WHO forecasting a deficit of 6.1 million health workers by 2030.

Furthermore, diseases such as HIV, tuberculosis, and malaria continue to present significant challenges across Africa, requiring sustained efforts and resources to address effectively.

Five countries with the best investments in healthcare

Morocco : Propelled by government support

Morocco’s population growth is driving increased demand for healthcare services and pharmaceutical products. The government is actively enhancing healthcare infrastructure and services through initiatives like the National Health Plan 2025. This proactive approach has created an appealing environment for investors, particularly through opportunities in public-private partnerships.

HealthTech, including telemedicine and digital solutions, is experiencing rapid expansion in Morocco. These technologies are enhancing healthcare delivery and system efficiency, with expected revenues reaching 753 million USD by 2024.

Morocco is also emerging as a key hub for medical tourism, supported by its strategic geographical location and the high quality of competitively priced healthcare services. The country’s pharmaceutical industry, one of the largest in Africa, boasts robust manufacturing capabilities and benefits from a favorable regulatory framework, projecting revenues of 643 million USD by 2024.

Nigeria : Sustained demand for healthcare services

Nigeria, with the densest population and largest economy in Africa, is experiencing a shift in healthcare demand due to its growing population and increased life expectancy. Similar to other developing nations, Nigeria is grappling with a rise in non-communicable diseases such as diabetes, cardiovascular disease, and cancer. This trend is fueling demand for specialized care, diagnostics, and pharmaceuticals.

In response, the Nigerian government has significantly increased its healthcare budget, reaching a record high of over 15 billion USD in 2023. Reforms are underway, including the implementation of the National Health Insurance Scheme (NHIS) aimed at achieving universal coverage, and the Basic Health Care Fund (BHCPF) to bolster primary care services. Nigeria is also positioning itself as a potential hub for medical tourism, having invested 1 billion USD in 2022.

Moreover, the technology sector in Nigeria is driving innovation in healthcare, leveraging telemedicine and mobile applications to enhance healthcare delivery and accessibility.

South Africa : Constantly developing healthcare sector

South Africa’s medical infrastructure surpasses that of its neighboring countries, boasting a comprehensive network of public and private healthcare facilities. This robust system addresses the diverse healthcare needs of its population, contributing to a mature market environment. Despite facing significant health challenges such as communicable diseases like tuberculosis, as well as non-communicable and cardiovascular diseases, South Africa’s healthcare sector is ripe for investment in specialized services, diagnostics, and treatments.

The country benefits from a stable regulatory framework that provides certainty and security for investors. Initiatives like the National Health Insurance Scheme (NHI) aim to achieve universal healthcare coverage, while the South African Health Products Regulatory Authority (SAHPRA) ensures oversight of drugs and medical devices.

Additionally, South Africa’s HealthTech sector is thriving, with a vibrant ecosystem of startups innovating in patient care and management, further enhancing the healthcare landscape.

Egypt : Hub for medical tourism

Egypt is experiencing sustained population growth, which is fueling increased demand for healthcare services and pharmaceutical products. In response, the government has launched various initiatives and reforms aimed at ensuring universal access to healthcare. Public investment in the health sector is on the rise, with a focus on constructing and renovating hospitals, clinics, and health centers, particularly in rural areas that are underserved.

Egypt is strategically positioning itself as a leader in medical tourism within the Middle East and Africa regions, offering high-quality healthcare services at competitive prices. By 2022, the medical tourism sector is expected to generate revenues exceeding 12.2 billion USD.

Furthermore, Egypt’s pharmaceutical industry is robust and well-established. It is projected to become the largest market in the Middle East and North Africa (MENA) region by 2023, with a market value reaching 56.6 billion USD. These developments underscore Egypt’s growing importance in the healthcare sector, both domestically and internationally.

Health : Priorities and opportunities in Kenya

The Kenyan government places significant emphasis on healthcare, exemplified by its Universal Health Coverage (UHC) program, ensuring access to quality healthcare services without financial burden for citizens. Major infrastructure projects are also underway, particularly in rural areas lacking adequate services.

Kenya is poised to emerge as a medical tourism destination due to its affordable yet high-quality healthcare offerings. Its strategic location, diverse tourist attractions, and well-developed hospitality industry make it an appealing choice for medical travelers.

Furthermore, Kenya’s pharmaceutical industry is experiencing rapid growth, catering to both the domestic market and neighboring countries. The nation benefits from strong pharmaceutical regulations and holds a competitive edge in drug production.