Growing Medical Tourism Attracting Investors in Malaysia

An excellent healthcare infrastructure, hospitals with state of art technology and fine recuperation facilities are some of the prime reasons to attract medical tourists in Malaysia. The country generated over MYR1 billion from more than 800,000 medical tourists last year and the volume of arrival is estimated to cross 1 million by 2020.

Not surprisingly, Malaysia has won Health and Medical Tourism Destination award three yeards straight in a row—2015, 2016 and 2017.

The increasing trend of healthcare tourism in Malaysia is unfolding huge opportunity for private investors as this segment of tourism is moving towards maturity. It is expected to surge exponentially at around 30% (CAGR) over next eight years.

Realizing sector’s potential contribution to the economy, the government stepped in with lucrative incentives and policy to encourage private and foreign investors in the sector:

  • Tax exemption: Hospitals registered under the Ministry of Health are eligible for tax exemption for promotion of medical tourism. The government has been extending tax exemption in capital expenditure like construction of new hospitals, modernisation of hospitals and expansion.
  • Double deduction incentive: Hospitals incurring expenses while obtaining accreditation—national or international—are entitled to enjoy the benefit of double deduction incentive. The incentive is focused to standardize the quality service of the hospitals.
  • Policy reformation: Removing the policy like 30% mandatory Bumiputra ownership (indigenous Malays) is likely to attract foreign investors in medical tourism.

Besides, the aggressive promotion of medical tourism by the government in international arena is also accelerating the sector at rapid pace.

  • The country aims to bring in high-value medical tourists who are expected to spend significantly on medical expenditure.
  • In order to further boost its medical tourism sector, Malaysia is targeting tourists from Islamic nations such as Saudi Arabia, UAE, Libya, etc. To be able to service them better, the country has developed better infrastructure such as prayer facilities, treatment by female doctors, halal certified medicines, etc.

Anticipating the growth of medical tourism, the country aims to earn over MYR 2.5 billion by 2020 and the figure is quite compelling for private investors to invest in this lucrative sector of Malaysia—medical tourism.


Subarna Poudel is a researcher with Frost & Sullivan. He can be reached at subarna.poudel@frost.com


Sapan Agarwal drives content and marketing for Frost & Sullivan. Sapan is based out of Kuala Lumpur Malaysia and can be reached at sapan.agarwal@frost.com | +603 6204 5830

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