Saudi Arabia will allow foreign investors to take 100 percent ownership of companies in its health and education sectors. It is the latest move by the country to gradually ease ownership restrictions on foreign firms, which have previously been required to set up a joint venture with a local partner.

It would be opening up education centers to have ownership 100%, all types of education even from primary school. This is something new for Saudi Arabia.
Meanwhile, the Education Ministry has hired HSBC as a financial adviser for its plans to privatize construction and management of school buildings.
SAGIA's efforts to ease ownership restrictions on foreign firms in recent years have included opening the wholesale and retail sectors in 2015.

In the health sector, the ministry will "just be a regulator and not a service provider anymore. This will open up $180 billion of investment opportunities in that sector over the next five years, Ibrahim al-Omar, Governor of the Saudi Arabian General Investment Authority (SAGIA) said.

As the number of patients increases, the impact on the capacity of hospital beds will be significant. In 2016, the average healthcare facility visit per person in Saudi Arabia was 2.1. The average length of stay was 3.9 days in general hospitals, 67.2 days in psychiatric hospitals, and 2.8 days for gynecology and obstetrics. The average bed occupancy rate was 55.1% in general hospitals, 65.7% in psychiatric hospitals and 59% for gynecology and obstetrics. Saudi Arabia currently has around 462 hospitals and 69,394 health care beds. However, this isn’t enough. Current numbers mean that there are 2.2 beds per 1,000  population, compared to the world average of 3.13.

The government is studying whether to sell off all public hospitals and 200,000 pharmacies and has begun the process for the King Faisal Specialist Hospital, Deputy Minister for Economy and Planning, Mohammed Al-Tuwaijri said earlier.

This decision could be a great opportunity for the DE members to enter the Saudi market in the health and education sectors. Recently 19 US medical companies held were meetings with several Saudi government officials to discuss health investment options in the Saudi market.

 

Sources: Al Arabiya - Riyadh newspaper