Is Medical Tourism The Next Arrow In Dubai’s Tourism Armoury?
- March 24, 2014
- Posted by: RKonnect
- Category: Healthcare, Hospitality & Tourism
Medical tourism has been in practice since long time. In earlier days it was present in the form individuals visiting distant lands for spring and spa treatment. Later, in 19th and 20th century it was present in the form of rich individuals from lesser developed nations travelling to more developed countries to avail advanced medical facilities.
However, after the advent of globalization and availability of advanced logistic and communication services, the dynamics of medical tourism has transformed significantly. In today’s world, it is estimated that annually around 30 to 50 million medical tourists travel to international locations to avail medical facilities. Presently, the trend is shifting towards; individuals from developed world, visiting developing nations in order to avail economical health benefits.
Moreover, regional dynamics also play a crucial role in deciding the trends of medical tourism, as large volume of travelers prefer regional locations over long distance. Consequently, various regional centers of excellence has emerged in the recent past such as; Dubai in (UAE), Jordan in (Middle East and North Africa) India, Singapore, Thailand in (Asia); Brazil, Cuba, Mexico in (South and Central America) and Turkey, Poland, Scandinavian countries in (Europe).
Limiting our research to Dubai, the report focuses on encapsulating the emerging trends in medical Tourism in the Emirates. Moving further, our research findings suggest that though Dubai is yet to realize its true potential, it is still considered among the top 20 global medical tourism destinations by expert. Similarly, Dubai is also touted as an evolving medical tourism center of regional significance. Armored with state of the art infrastructure, logistics and medical facilities, the Emirate plays an instrumental role in regional medical tourism market which is worth USD 20 billion.
The estimated annual revenue from medical tourism in UAE is worth AED 5.9 billion (USD 1.6 billion), much of which comes from Dubai. The present market is increasing at the rate of 10-15 percent annually. Majority of the medical tourists come from Middle East and North Africa, South Asia and Central Asia.
Some experts believe that medical tourism, which is so far underutilized in Dubai, has the potential to yield tremendous results, much higher than regular tourism. According to Dubai Tourism and Commercial Marketing (DTCM), one five star bed space in Dubai generates annual revenue of AED 500,000 (USD 136,000). The total cost of capital involved in developing a five star bed space is AED 2 million (USD 544,000).
Same amount (AED 2 Million) is required to set up a bed space in a hospital in Dubai. However, in contrast to five star hotels, the expected yield is almost four times high.
Dubai Government Initiatives
In order to attract and retain medical tourists in big numbers, Dubai government is undertaking various strategic initiatives. One such initiative is the specialized free-zone named Dubai Health Care City (DHCC) built in the emirate which includes over 120 medical healthcare centers and around 4,000 medical professionals.
Likewise, the Dubai Government has also introduced a separate three month VISA for medical tourists which could be further extended couple of times covering nine months in total. Also there is a provision for very short period VISA for a day or two for doctors coming for emergency services such as surgery.
Recently, according to the press release by Dubai Health Authority (DHA), it has prepared a new strategic plan, which will be aimed at new markets such as Russia, CIS country, South Asia along with existing markets such as Middle East and GCC countries. The strategic initiative will involve treatment, visa, air tickets and leisure activities and will be rolled out by the end of this year, is expected to facilitate a revenue inflow of AED 1.2 billion (USD 0.33 billion).
Strategically located between west and the east, Dubai International Airport is one of the busiest airports in the world. In the first, five months of 2013, with an average international traffic of 180,000 per day, it leads all other international airports in terms of international traffic. Out of this around 1,500 – 2,000 are estimated to be transiting via Dubai to travel to a medical destination every day.
This offers a great opportunity to Dubai. Even if Dubai captures 20 percent of the transit passengers with the aid of better medical services and well planned marketing, it can add up to over 100,000 tourists every year. With the start in service of the Al Maktoum International Airport, it is believed that the annual traffic will jump over to 160 million, which can further boost medical tourism.
The prospect of medical tourism in Dubai is also considered to be correlated with the overall tourism infrastructure as many medical tourists are accompanied by their family members who try to integrate some leisure activities with medical services. In this regard, Dubai is very well placed as the Emirate has plethora of spell binding buildings, hotels, resorts and other places to visit. The Emirate is considered as one of the leading tourist destinations across the globe, offering numerous leisure options. Additionally, another feather in the cap is its tremendous infrastructure in the form of state of the art airports, airlines and public transport system that connects it conveniently with the entire globe along with facilitating smooth and fast internal commuting.
Dubai’s ambition of morphing into a world class international medical tourism hub is not insulated with challenges. At Research Konnection, we conducted a separate qualitative study to gauge the performance of various health care entities in Dubai. The research showcased some negative yet interesting insights. In spite of investments from government and private bodies, many analysts and residents alike are not very confident about Dubai’s health care competence, especially in the areas pertaining to specialty treatments for women and children. Many affluent nationals still prefer going to America, Europe while others prefer India. (Though some our research indicates a considerable decrease in this outflow due to coming of better doctors and facilities). Our interviews have also revealed individual cases of poor response from some hospitals, medical centers and poly clinics. Respondents have stated that they had to wait for long even in cases of emergencies.
Rise of competition is another challenge that the Emirate intercepts. Besides Jordan, other regional economies such as Bahrain and Kuwait are trying hard to position themselves as strong contenders in the lucrative medical tourism market. Dubai, also faces stiff competition from India, which is known for offering good quality health services at an economical price. In 2013, India received near about a million medical tourists generating around AED 8.45 billion (USD 2.3 billion) in revenue. However, Indian infrastructure and hospitality is still in its evolutionary stage and that gives Dubai a space to showcase a unique value proposition of integrating medical and leisure tourism together.