Indonesia’s rising dependency on imported healthcare equipment
Indonesia has been depending on imported medical equipment for many years already, and according to one Government official, it is long over due to reduce the need on medical equipment that comes from other countries outside of Indonesia.
To put it into perspective, the numbers have been staggering. According to the Head of Central Java provincial Health Agency, a whopping 94 percent of medical equipment are imported, while only a mere six percent comes from locally manufactured medical products. Mr Yulianto Prabowo, who is the Head of the Central Java Provincial Health Agency, was opening a healthcare equipment factory in the city of Semarang, when he mentioned that distribution permits are now mostly controlled by overseas companies, according to Kompas.com.
Mr Yulianto Prabowo encouraged Indonesians to increase the local manufacturing of healthcare equipment instead of relying on foreign imports to meet the demand. The healthcare equipment market in Indonesia has an annual value of an approximate 12 Trillion Rupiah, which is at about 900 million US Dollars. Of the amount, about 1.2 trillion Rupiah are spent by Central Java based hospitals and clinics. Therefore, the size of the market for healthcare equipment is huge and reflects a huge potential.
Mr Yulianto Prabowo also expressed his hopes that there will be greater transparency in the procurement process for healthcare equipment, so as to increase fairness and reduce unhealthy competition in the market. He also urged hospitals, clinics along with other institutions in the healthcare field to start purchasing more equipment from local, Indonesian made equipment such as radiology tools, operation tools, wheelchairs, beds for patients among others.
Currently Indonesia has over 250 million people with 1500 public hospitals as well as over 650 private hospitals. As such, the bed to population ratio is one of the lowest in the world, with about 0.8 to 1000 according to 2012 data. Medical care in Indonesia is still not developed yet in Indonesia, where the most wealthy tend to leave the country to Malaysia or Singapore for health care. Indonesia’s healthcare only accounts for 3 percent of the Gross Domestic Product (GDP) and the per capita spending on health care is about US 100 dollars. This indicates that Indonesia is lagging behind other Association Southeast Asian (ASEAN) countries including Malaysia and Thailand, with a spending of US 300 dollars and US 200 dollars respectively.
Currently Indonesia imports equipment from several countries such as United States, China, South Korea, Germany, Japan and Singapore. The United States account for about 15 percent of imports in the sector, while other countries such as China and South Korea specialise in offering cheap and affordable equipment to hospitals and medical institutions in Indonesia.
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