Medical tourism boosts business

June 20, 2007 - 12:35PM

Umuh Muchtar was in such agony after botched surgery in Indonesia that he took a friend's advice and contacted a hospital in Singapore where he had his kidney stones removed a few days later.

Muchtar is one of the 1.3 million medical tourists from Asia, Europe, and the United States who fly to Singapore, Thailand or Malaysia each year for medical treatment because they are wary of the hospitals back home or consider them too expensive.

"I'm very satisfied with the treatment in Singapore," said Muchtar, 59, after checking out of Singapore's Raffles Hospital, part of Raffles Medical Group , to do some shopping.

"I don't need to wait so long to see a doctor here, compared to Jakarta, where I would not be seen for five to six hours."

Medical tourism is potentially big business in Asia, and is expected to grow from about US$0.5 billion now to US$4 billion by 2012. But for investors, the sector looks very expensive, with valuations about 40 percent higher than their counterparts in North America and Europe.

Shares of Southeast Asian hospital firms such as Raffles Medical and Thailand's Bumrungrad Hospital have soared to record highs this year, as regional economies flourish and as governments throughout stress the need to develop a thriving medical tourism industry.

"They represent a play on the long-term growth in the region," said Peter Chiang, chief equity strategist of DBS Asset Management, which owns shares in Thomson Medical Centre.

"Hospital care will serve the needs of a growing affluent population. Singapore, Bangkok and Kuala Lumpur have positioned themselves well in this aspect."

Source: Sydney Morning Herald

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