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Monday, May 7, 2012

Medical tourism: Langkawi needs a shot in the arm

MALAYSIA is promoting itself as a top tourist destination as well as a medical tourism hub.

Every hotel operator wants a presence in Langkawi, yet not a single private hospital operator wants to be there.

The Langkawi Development Authority (Lada) has even designated land in Langkawi to accommodate a private hospital and wellness facility. But, to date, there are no takers.

Private hospital operators have stayed away from Langkawi for reasons ranging from lack of demand, difficulty in placing specialists on the island, to talks that the existing government hospital is under-utilised.

Langkawi received 2.8 million tourists in 2011 with the numbers projected to touch 3 million in 2015. Tourism receipts are expected to double to RM3.8 billion in 2015 from RM1.9 billion in 2010.

Langkawi plans to bring in high-yield tourists from countries like the UK, Australia and Saudi Arabia. It wants to increase the average length of stay to 7.4 days from 2.1 days (in 2010) and to double average daily spend by 2015.

Are these future figures attractive enough to lure investors to open a medical centre?

The opening of a private hospital would immediately cater to tourists who may need medical care while on vacation and employees on the island whose package include private hospital care.

As it stands, patients seek treatment at the nearest private hospital - which happens to be in Penang.

However, Lada's chief executive officer Tan Sri Khalid Ramli has started to promote the island as a suitable venue for medical tourism and rehabilitation. It has even started to invite international investors for this purpose.

Perhaps, the investors' view is the island just doesn't need a full-fledged hospital.

If this can't work, surely there are ways around it.

Why not start a specialist centre with just ambulatory care or a boutique medical centre which also offers aesthetics and plastic surgery?

Surely, cosmetic surgery packages in Langkawi would be a great holiday lure.

If indeed the government hospital in Langkawi is vast, would creating a private wing within the existing hospital work?

Then there is state-owned Khazanah Nasional Bhd which is opening hotels in Langkawi. Since Khazanah is a catalyst in many initiatives where the private sector is reluctant to take the lead and with it owning the prestigious Parkway Pantai hospital chain, maybe it can be the first mover.

Unlike previously, there are tax incentives for medical centres registered with the Malaysia Healthcare Travel Council (MHTC). MHTC is the primary agency set up to develop and promote health tourism.

Those registered get investment tax allowance of 100 per cent on the qualifying capital expenditure incurred within a period of five years from 2010. Private hospitals can also get double tax deduction for expenses in obtaining accreditation.

Langkawi is a duty-free island. A few additional tax incentives might help bring in the players and removal of personal income taxes for doctors and specialists may tempt them to work on the Island of Le-gends.

By Business Times

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