Health care in Ethiopia

95% of the people in Ethiopia can’t afford health care. That leaves more than three million people who can pay. Not to mention the five thousand Ethiopians who travel abroad each year for medical treatment. This is a new market that offers great potential.

Fikru Maru emigrated from Ethiopia to Sweden about 30 years ago. He trained as a doctor, specialising in cardiovascular diseases, and for several years he has been a senior physician at Danderyd Hospital’s Heart Clinic. Now, he and his partners are running the first specialist cardiac hospital in Ethiopia, the Addis Cardiac Hospital, which has thirty beds. All the patients pay for their treatment.

The idea of starting a hospital on a commercial basis came to him when he saw what little benefit much of the conventional foreign aid produced.

“By going for a private concept and raising venture capital, we are doing much more good in Ethiopia, and also making a profit. We believe it is very important that the treatment provided is not free. We produce greater benefits that way, and we can only carry on if we are profitable.”

Fikru Maru raised risk capital from Swedfund, medical engineering companies, and a local partner in Ethiopia.

Better health for many more people

The need for medical care in Ethiopia is almost immeasurable, and it is quite natural to pay for treatment. The group Fikru Maru sees as the hospital’s target group - the Ethiopian middle class – is afflicted by heart diseases just as much as people in Sweden. On top of this, it is the most productive people in the country, the ones who can help Ethiopia’s development, who get these diseases.

As an investor, Fikru Maru naturally has a head start, since he was born in Ethiopia and has an established network there. But he is convinced that more Swedish companies could find promising markets in Africa. By tradition, Swedes are well reputed there, including in Ethiopia.

“The most important first step to take when starting a business in Africa is to get a local partner. In Ethiopia help can be obtained to find a local partner and there are many competent companies out there. The second most important step is to understand the differences in culture and customs; this will enable you to find the middle way you need to establish an efficient organisation. You need to have some common ground when it comes to values and business practices."

To Fikru Maru it is self-evident that there is a market for his hospital’s services.

“Ethiopia would need at least ten large hospitals to meet the need for treatment of heart diseases."

Important to learn the local rules

There is now much less bureaucracy in Africa than there was ten years ago, but it is still more widespread than in Europe. However, Addis Cardiac Hospital dealt with all the necessary permits and cut its way through the bureaucracy in one day. How? Partly because the authorities had been forewarned, and partly because the investment was important to the Ethiopian government.

“It is important to have local contacts and warn the authorities that you are planning to apply, and not to turn up on their doorstep as a total stranger. In Africa is also important to have several plans in your back pocket, to have more than one solution. You need to be flexible, with several options ready,” explains Fikru Maru before catching his flight down to a market that many more investors would find well worth looking at. "