A steadily rising population and increasing treatment costs have driven increased healthcare expenditure in the GCC. Over a period of five years up to 2013, spending in the region grew at a compound annual growth rate (CAGR) of 10.3 per cent, to $49.5bn.

This trend is expected to gather pace in the future: combined statistics from the World Health Organisation, World Bank, Alpen Capital and others see the GCC healthcare market growing 12.1 per cent between 2015 and 2020, from $40.3bn to $71.3bn.

Predictions on growth from country to country in the region remain positive, with each individual market estimated to expand by 11 to 13 per cent annually between 2015 and 2020.

Due to its large population base, Saudi Arabia is by far the largest contributor to the region’s healthcare spending, accounting for 47.9 per cent of the market total. The UAE is second, at 26 per cent and collectively the two countries account for nearly three-quarters of the region’s spending on healthcare.

At 50 million, the GCC accounts for just one per cent of the global population. However, the region saw average growth of 4.4 per cent over the decade to 2014, aided by a massive inflow of expatriates. The Economist Intelligence Unit has forecasted that by 2020, the GCC’s population will reach 53.5 million, a 30 per cent increase over the level in 2000.

The region has also been noted for its youthful population, with 54 per cent under the age of 25. However, with estimates predicting this will rise to 36 by 2050, the health implications will start to shift. At the moment, the GCC’s population is concentrated in the young and the working-age categories, with 24.3 per cent below 15 years of age and two-thirds of the population aged 15-49 years in 2014. Bad dietary habits in this demographic have been attributed to growing trends of diabetes, cardiovascular disease, depression and obesity.

A sustained focus on healthcare has improved key health indicators such as life expectancy at birth, infant mortality rate, and crude death rate. However as lifespan increases, so too does the timespan over which an average person requires healthcare services. The average life expectancy at birth in the GCC is 77 years, above the global average of 71.5 and close to North America. In the UAE, life expectancy for males and females is 76 and 78, respectively.

With government initiatives such as Dubai Plan 2021, the embrace of new healthcare technologies, increased attention on regulation and updates on infrastructure, the UAE healthcare sector seeks to compete on a global level. Healthcare spending in the country grew 8.9 per cent from $8.4bn in 2008 to $12.9bn in 2013, with per capita healthcare spend at $1,569 in 2013 – the second highest in the GCC. High birth rates, a rise in life expectancy, the growing incidence of lifestyle-related diseases and an uptick in medical tourism will all continue to drive growth in the UAE./div>

Already boasting an 8.9 per cent increase in healthcare spending between 2008 and 2013, expenditure is predicted to grow further as the UAE ramps up on medical infrastructure and regulation. Just one example of the country’s renewed focus on healthcare is a master plan to boost healthcare in Dubai, which included an $817m revamp of Rashid Hospital, 40 new primary healthcare centres, and three new hospitals.

It is projected that this and other government initiatives will drive expenditure above $19.5bn by 2020 – which is an annual average growth of 12.7 per cent from 2015. Of this $19.5bn, the outpatient market will comprise the biggest portion, projected to be $12.1bn, with inpatient estimates of $7.5bn in the same time period.