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COVID-19: A catalyst for UAE’s health sector

COVID-19: A catalyst for UAE’s health sector
The UAE has been recognised as being one of the safest locations in the world in the fight against COVID-19.

The healthcare sector in the UAE has undergone a considerable number of infrastructure and procedural changes in order to position itself as a leading healthcare provider both for its residents and as a medical tourism destination.

These improvements have been more recently recognised and lauded throughout the on-going COVID-19 pandemic. As a result of the continuous investments which have been made to improve the sector’s hard and soft infrastructure, the UAE has been recognised as being one of the safest locations in the world in the fight against COVID-19.

With many countries beginning to lift lockdown measures and gradually return to some form of normality, the scale of the pandemic’s economic impact will be realised over the coming months, with fundamental structural changes expected to occur in many economies. Alongside this, the COVID-19 pandemic has also raised many questions as to the future structure of the healthcare sector both in the UAE and globally.

Impact on UAE’s healthcare sector

The slowdown in economic activity and resultant cost-saving measures employed by firms will mean the UAE’s healthcare sector is likely to face significant headwinds in the short to medium term, despite its status as a defensive sector.

The slowdown in the sector has and will not only be driven by the weaker economic backdrop, but also as a result of the various measures enacted to slow the spread of the pandemic. First, with elective surgeries and unnecessary hospital visitation being suspended – although this suspension has now been partially lifted – as part of the containment measures enacted, many service providers have and continue to face a marked decline in financial resources.

With demand likely to soften and the financial position of operators likely to deteriorate, there maybe consolidation in the sector with cash-rich firms undertaking M&A activity to strengthen their market position.

Furthermore, whilst terms such as digital transformation and telehealth have been regularly used for over a decade, we have not seen these segments of the market gain any traction. However, COVID-19 has acted as an accelerator where now telehealth, teleradiology and online pharmacy retail are now truly emerging and being adopted by leading healthcare providers in the UAE.

To read more, download Knight Frank’s latest report that examines the development of the pandemic in the UAE and the responses taken to manage risks and limit mortality rates, as well as the potential economic impacts of the pandemic.