Investing in Stronger Health Systems for Africa: A New Frontierby Nishit N. Shah, Director, Africa Health Business

The COVID-19 pandemic has shown how fragile our global preparedness for infectious diseases is. The disease has spread swiftly from China across the world – with major impacts on health, economy, and quality of life of communities. The status of the disease in Africa is evolving and the lessons learned over time are increasing – however, they all point to the urgent need of building resilient and sustainable health systems.

KidAn Urgent Need For Investment

While the pandemic has exerted significant strain on already overstretched health systems across the region, further affecting the delivery of other essential health services – a broader spectrum of stakeholders is now feeling the consequences of chronic underinvestment. The impact of the COVID-19 pandemic has demonstrated that every sector is dependent on the health system. The prominence of the healthcare sector as a result of the pandemic has presented us with a unique opportunity to increase local investment within the sector. To meet Africa’s growing demand for healthcare, almost $30 billion in new investment is needed to support infrastructure, supply chain management, technology and to build a sustainable health workforce. Slowly but surely, health is becoming a business in Africa. Organisations in the private sector have already sensed an opportunity in healthcare markets across the continent. In a continent that has 16% of the world’s population, bears 25% of the global disease burden and has less than 4% of the global health workforce, the private sector has positioned itself as an important provider of healthcare. In recent years, private equity funds have invested almost $300 million in Africa’s healthcare sector. In 2016, sub-Saharan Africa saw the largest private equity investment of $70 million in Hygeia, Nigeria’s largest healthcare institution.

The key hotspots for health investment in Africa as identified by Africa Health Business Ltd include human resources for health, supply chain management solutions, digital technologies and disruptive innovations and healthcare infrastructure.

Public Private Partnerships

More African governments are beginning to embrace working with private healthcare sector players in a number of different ways. Drafting laws and regulations which attract and sustain investor interest for healthcare projects is a priority and the implementation of PPP policies will open these markets to private investors, helping governments to meet the growing demands of higher quality and more specialised medical care, presented by the growing middle class and a twin burden of communicable and non-communicable disease.

Human Resources For Health

African countries have a very low-density health workforce, compounded by a poor skills mix and the ongoing inadequate investment in health education. Over the past 10 years, there have been many missed opportunities to invest in the development of the health workforce. With only 4% of the global health work force, a rapid increase in educational institutions and urbanisation across many African countries will help address skill shortages through brain drain within Africa, as will the “human energy advantage”. Africa has and will maintain the world’s youngest working population for decades to come.

Supply Chain Management

The supply chain and pharmaceutical manufacturing sector on the continent provides another lucrative hotspot for investment. The value of the African pharmaceutical market rose from $US4.7 billion in 2003 to $US20.8 billion in 2013 and is expected to reach approximately $US60 billion by the end of 2020.2 The African Union, and its members, are focused on supporting local pharmaceutical manufacturing in Africa and increasing access to affordable quality medicines. Governments are also offering tax exemptions, reduced land prices and other incentives to help bring manufacturing plants to Africa. Outside the healthcare sector, governments are supporting Investment in African infrastructure including roads, railways and ports. The political will to reduce trade barriers and transit times through harmonised regulation, streamlining border processes and investing in regional transport corridors is strong. While pharmaceutical logistics chains have specific requirements, closing the infrastructure deficit is an important first step to increasing the feasibility of a sustainable and high value medical manufacturing industry.

Digital Technologies

At a time when distributed services and digital health are emerging trends, Africa is “leap-frogging” advanced and innovative solutions by combining healthcare, communication and technology. Digital health has the potential to significantly reduce costs and inefficiencies, whilst improve access to quality affordable healthcare. Growth in the number of mobile phone users and wireless subscribers, as well as advances in the innovative application of communication technology to address health priorities, have the potential to revolutionise how healthcare is delivered across the world, providing significant, long-term revenue-earning opportunities for companies in both developed and emerging markets. In Africa, governments will adopt digital technologies as a complementary strategy to strengthening their healthcare systems, particularly by increasing the populations’ access to healthcare which continues to be a major issue.

Working Towards

A Healthier Africa As the market develops, pro-growth policies and appropriate regulation are critical ingredients to ensure suitable quality health standards while maintaining a competitive level playing field. An appropriate framework that attracts investor interest but safeguards public interests will be the main focus towards a healthier Africa.


1. http://www.financialnigeria.com/ifc-others-invest-66-8-million-in-hygeia-nigeria-sustainable-photovideo-details-286.html

2. https://nipc.gov.ng/2016/11/09/maximising-return-healthcare-investment-africa/

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