Healthcare sector will be in robust health during 2019, says report
Trade tensions and political pressures will fail to derail the global healthcare sector in 2019, especially as pharmaceuticals are not subject to tariffs in the Sino-US dispute
The Economist Intelligence Units (The EIU) has issued the latest findings of its Industries in 2019 survey. This report highlights five major risks that could affect The EIU's industry forecasts for the year ahead: the US-China trade war, a global slowdown, Brexit, sanctions on Iran and cybersecurity and technology risks.
For healthcare findings suggest:
· Global life expectancy will rise by another two months in 2019 despite uneven progress in healthcare reforms.
· Healthcare spending will climb by 5.1% worldwide, including 5.7% higher spending on pharmaceuticals.
· The US will step back from universal healthcare, but countries such as South Africa and China will extend their public health systems.
· The US-China trade dispute poses risks for the sector, even though pharmaceuticals are mostly protected from tariff barriers.
"Underlying expectations for the healthcare sector in 2019 are mostly positive, regardless of world events," says Ana Nicholls, director of industry operations at The EIU. "Even so, trade tensions and political upheaval will create uncertainty."
The US-China trade dispute has not targeted healthcare specifically – tariffs on most pharmaceuticals remain at or near zero – but trade in chemicals has been affected. That could cause supply shortages in 2019. The report also suggests that tariffs may be imposed on other medtech sectors such as medical robots and computed tomography equipment. In Europe, meanwhile, Brexit could also cause bottlenecks for some medicine imports unless a deal is reached.
Progress towards universal healthcare across the world will be uneven. In the US, from January 1st it will no longer be mandatory for individuals to buy insurance. This will end the risk-sharing that underpinned Obamacare, although the government hopes it will also increase the availability of cheaper insurance. In countries such as South Africa, Nigeria and Oman, meanwhile, we expect new efforts to extend insurance coverage to more people. China will continue to roll out far-reaching reforms in order to tackle a rise in non-communicable diseases. As a result, we expect healthcare spending to climb by 5.1% worldwide, while pharmaceutical sales will increase by 5.7%.