We maintain our forecast for Vietnam’s medical device market and expect a return to growth in 2024 after an uncharacteristic slowdown in 2023. After experiencing a single digit decrease y-o-y from 2022 and 2023, we anticipate double-digit y-o-y growth in 2024 and for that growth to be sustained in the high single digits in the medium term.
Key View
- We maintain our forecast for Vietnam’s medical device market and expect a return to growth in 2024 after an uncharacteristic slowdown in 2023.
- A focus on regulation to manage medical device registration backlog and price negotiation will ease medical device shortages.
- Continued multinational investment in Vietnam’s private healthcare system will strengthen the medical device market.
We project that Vietnam’s medical device market will grow at a 2023-2028 compound annual growth rate (CAGR) of 10.3% in local currency terms and 9.9% in USD terms to a value of VND64.1trn (USD2,498.2mn). The medical device industry in Vietnam stands to benefit from strong domestic demand and increased healthcare spending, driven by favourable economic conditions and government initiatives aimed at modernising healthcare infrastructure.
While the elderly population in Vietnam is small, the country is rapidly ageing which will further strengthen the medical device market. Although the one-party system is generally conducive to short-term political stability and policy continuity there has been increasing political risk in Vietnam following the resignation of two high profile party members in the first half of 2024. The increased risk will disrupt policy making and implementation, having an impact on the success of Vietnam’s long term healthcare strategies.
Vietnam’s medical device market is poised for steady growth, driven by increasing international healthcare investments. As the country continues to modernize its healthcare infrastructure, foreign capital is flowing into various sectors, including medical devices. This influx of investment not only enhances the quality and availability of healthcare products but also fosters technological advancements that are crucial to meet the rising demands of the population.
The Vietnamese government recognizes the importance of the healthcare sector and has implemented policies to attract international players. By establishing favorable regulatory frameworks and easing restrictions for foreign investments, Vietnam is becoming an attractive destination for companies looking to expand their footprint in Southeast Asia. This has led to improved access to innovative medical technologies, which is essential for addressing the country’s evolving healthcare needs.
Moreover, as Vietnam’s aging population grows, the demand for advanced medical devices will continue to increase. This trend, coupled with higher disposable incomes and a rising awareness of healthcare issues, positions Vietnam as a burgeoning market for medical device manufacturers. With the right investments and partnerships, the future looks promising for Vietnam’s medical device industry.
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