The Business of Health in Africa

The Business of Health in Africa, a new study commissioned by the International Finance Corporation (IFC), surveys and analyzes sub-Saharan Africa’s rapidly growing private health care industry. The study was conducted by McKinsey & Company and largely financed by the Bill & Melinda Gates Foundation. The study notes that the private health care sector in Africa is surprisingly large and constitutes an important, diverse component of the region’s health care systems. The study estimates that total health expenditures in the region will increase from $16.7 billion in 2005 to $35 billion in 2016. In addition to chronicling the constraints facing the provision of health care in Africa, the study makes five key policy recommendations. The study urges stakeholders to: (1) develop and enforce quality standards, (2) foster risk pooling programs, (3) mobilize public and donor money to the private sector, (4) modify local policies and regulations to foster the role of the private sector, and (5) improve access to capital. In conjunction with the release of the report, the IFC announced that it is launching an initiative to mobilize up to $1 billion of investment and advisory services support over the next five years. IFC’s strategy includes creating an equity investment vehicle for health care entrepreneurs and businesses, partnering with local financial institutions to improve access to long-term debt for health care organizations, and supporting country assessments and a biannual report on the climate for health care investments.