Healthcare in Africa is an investment worth making

The world is slowly turning to and acknowledging Africa as an emerging source of economic power in the international market.

However, the continent has many challenges to overcome if it is to rise to the heights of which it is capable.

One of the building blocks that will ensure Africa unleashes its true potential is investment in the healthcare sector that relies predominantly on infrastructure development. The strength of a country’s economy partially depends on how healthy and strong its workforce is.

In 2009, an article posted by allAfrica.com stated that healthcare costs had increased because there was great demand, thereby pressuring African governments to meet the challenges around this.

Partnerships are key in today’s business world, and with healthcare being an area in which there is much interest in terms of the economy and longevity for Africa, strong financial collaboration is required between international organisations, local organisations and African governments.

One example of how well collaboration has worked thus far is the Health in Africa Fund, which first launched in 2009.

Overseen by the London-based private equity fund manager, Aureos Capital, which deals mainly in medical small and medium enterprise start-ups, the Health in Africa Fund was able to acquire stakes to the value of $2.66 million by investing in the Nairobi Women’s Hospital in Kenya.

One of the greatest problems Africans have in requiring medical care is that it is usually far too expensive; the medical staff are ill-trained or lacking; the medication itself is costly; and sometimes infrastructural issues such as a lack of proper roads or transport compound the situation.

The common goal of The Africa Fund, the International Finance Corporation (IFC), the African Development Bank, the Bill & Melinda Gates Foundation and the DEG (an arm of the KfW banking group) is to increase access to top quality medical care and to make the services and products affordable to the African population.

The primary objective of the Nairobi Women’s Hospital is to provide healthcare to women and children.

What puts this hospital a cut above the rest – besides the specialised services it renders to its female patients such as gynaecology, obstetrics, breast cancer detection and surgery, and in- and out-patient care – is that it is perhaps the first in East Africa to have opened a Gender Violence Recovery Centre.

According to Sev Vettivetpillai, chief executive officer of Aureos Advisers: “Through the Africa Health Fund, we look forward to helping populate Africa’s private healthcare sector with growing, profitable businesses – well-positioned to attract further domestic and foreign investment.”

A report conducted by the IFC, entitled “The Business of Health in Africa”, found that 60% of financial resources came from private sources; and that 50% of health costs went to the same private providers – keeping poor people out.

The point of the collaboration is to provide capital to SMEs operating in the healthcare sector which, in conjunction, have private equity support improving the level of professionalism in the sector.

Essentially, research conducted in 2007 – a collaborative effort between Aureos and the Norwegian Investment Fund for Developing Countries – showed that African healthcare was in dire straits.

“Much of the African healthcare sector suffers from severe structural and systemic bottlenecks. There is severe market fragmentation; inadequate, inefficient distribution channels; high manufacturing costs; price distortions in the market; lack of effective supply chains; absence of economies of scale; low productivity levels; and, in many cases, dependence on large international health providers,” according to the research.

Over many years, Aureos has studied healthcare in Africa and, through this, it has determined the correct procedures, the right products and the right prices – opening up avenues for investment.

Earlier last year, delegates from Ethiopia visited India to gain more knowledge on how its healthcare and SMEs operated.

It was reported that the delegates were so impressed by the top quality of some of India’s private hospitals that, with India’s help, they wanted the country to be turned into a medical hub that all Africans would visit. The idea was to provide mutually beneficial outcomes for India and Ethiopia.

While Ethiopia is the centre of the African Union, the stopover point between many African countries, the healthcare landscape is barren – forcing many of the 3.3 million citizens to choose healthcare options in other countries.

According to sources, a memorandum of understanding is to get under way at this time between Ethiopia and India.

According to the Africa Sustainable Investment Forum (AfricaSIF) blog at www.africasif.org, posted in June last year, “Tim Knapp, Ben Richardson and Shrey Viranna informed readers of what they believed were the three most promising healthcare delivery approaches in Africa.

“The authors assert that a model comprised of local health officers, telemedicine and mobile clinics would effectively solve the access to healthcare problems at low costs.

“The Africa Sustainable Investment Forum believes that in a region where women face 100 times the risk of maternal mortality than women in developed nations, these comprehensive approaches are crucial in ensuring the future of these nations.”

According to the blog, hiring professional local staff who would be able to handle manageable numbers of patients is paramount. Another is telemedicine, whereby call centres operated by healthcare professionals give support and information through teleconferencing and telephone calls to doctors on the ground dealing with the patients.

Thirdly, this would be done through creating mobile clinics that would consult with patients, dispense medication and support for communities and, due to the mobility of these clinics, would cut transport costs – improving the community’s overall state of health.

However, the healthcare professionals would need to be inspired by competitive salaries; dates, destinations and times of mobile clinic interventions would need to be made public knowledge weeks in advance; and teleconferencing would need to be running properly in order for doctors on the ground to treat patients effectively.

Perhaps this could be done, but the support and investment from African governments, non-governmental organisations and businesses both local and international is what is likely going to help improve the overall healthcare in Africa.

Staff reporter