2013 Medical Equipment Industry Overview in ASEAN Markets

9/11/2014 2013 Medical Equipment Industry Overview in ASEAN Markets

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2013 Medical Equipment Industry Overview in ASEANMarkets

Summary : The driving forces of global economic and trade development are gradually shifting towards southeastern Asian countries by emerging countries and inter-regional economic and trade cooperation. According to the Business Monitor International (BMI) survey,the total amount of medical equipment market in Indonesia,Philippines, Vietnam, Thailand, and Malaysia in 2012 reached 3,798 million US Dollars and this number is expected to reach 7,480 million US Dollars by 2017 with CAGR of 14.5%. It is necessary to understand the potential of ASEAN region in order to get the subsequent marketing opportunities.

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The global economic and trade development are shifting towards leadership by emerging countries and inter-regional economic and trade cooperation in southeastern Asian countries, including Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. Inspite of the small individual markets, the countries have formed the Association of Southeast Asian Nations (ASEAN) organization through alliance and transformed into an economy that owns enormous market of domestic demand and rich resources, which will become the new development center for global economy and trade. Moreover, the cooperation between mainland China and ASEAN formed the plus one advantage for ASEAN, which will inevitably affect the subsequententrance opportunity and competiveness in the ASEAN market. Situated in Asia-Pacific Region, Taiwan must not take absence from this opportunity of development and it is foremost important to understand the potential of ASEAN region in order to get the subsequent marketing opportunities.

According to the Business Monitor International (BMI) survey, the total amount of medical equipment market in Indonesia, Philippines, Vietnam, Thailand, and Malaysia in 2012 rea

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ched 3,798 million US Dollars and this number is expected to reach 7,480 million US Dollars by 2017 with CAGR of 14.5%. It is a market with high growth rate as shown in Table 1.The import supply ration of the five countries shows that theregional medical equipment all relies on import while the local medical equipment suppliers merely engage in the production of lower-level medical equipment and products, which is deemed as field waiting to be developed by the medical equipment suppliers in Taiwan.

The observation on the development opportunities for futuremedical equipment indicates that the demand for medical equipment in Indonesia will mostly consist of diagnostic imaging products in the next five years. Nonetheless, other medical equipment including wheelchairs, ophthalmological equipment, anesthesia instrument, dialysis equipment, endoscope equipment, and medical furniture are the medical equipment and products with the fastest growing speed. In Philippines, dental products and orthopedic and implants account for the products with the fastest grow while Vietnam is one of the fast growing country in terms of Chinese medicinal equipment market among Southeastern Asian countries. The diagnostic imaging products show the largest market size whilebone plates and other wound fixture products show the fastest growth. Thailand also relies on diagnostic imaging products while dental products and orthopedic implants are the products with fastest growth in the medical equipment marketof Malaysia.

Table 1 2012~2017 Major ASEAN State Medical Equipment Market Development Trends

Country Population (100 million)

2012

2017

2012~2017 CAGR

Import Supply Ratio

Indonesia 2.45493

886

12.44 92.9

Philippines 0.95269

410

8.22 87.6

CompetentAuthority 0.90

634

1,487

18.59 93.1

Scope of Control 0.69

1,07

1,91 12.30 84.9



1 3

Products ofControl 0.29

1,331

2,784

15.90 75.9

Unit: Million USD, %

Source: Espicom(2012). Prepared by ITRI IEK(2012/08)

In particular, the regulations for medical equipment becomethe foremost important threshold for industries to enter ASEAN market. ASEAN is an economic alliance formed by many States but each State owns its proprietary medical equipment regulations and law, forming an entrance threshold. ASEAN has formed the Association of South East Asian Nations Consultative Committee for Standards and Quality- Product Working Group on Medical Device, ACCSQ-MDPWG with aggressive actions in mediating the medical equipment regulations. Currently, the Group is steered by Singapore and Malaysia. Due to the high growth potential in SEAN market, Taiwan companies also find new opportunities in this market. In the future, Taiwan government should assist the domestic industries to obtain real-time regulation mediation and promotion in ASEAN States in order to reduce the regulatory barriers faced by exporters of medical equipment.

Due to the smaller market size of individual medical equipment market in ASEAN States, it is necessary for the Government to assist suppliers with expansion of market regulations required and marketing channel information for the suppliers to engage in easy marketing. The industries are also advised to form marketing alliance, whereas companies expandin larger individual market, followed by adopting co-marketing strategies to enter each State market.

Since Taiwan overlaps and competes with China and South Korea in medical equipment, the suppliers not only need to compete with foreign suppliers of medical equipment in Taiwan but also compete on the global level. In the future, Taiwan government should assists with industry upgrade in order to turn Taiwan into top choice of medical equipment manufacturing center apart from coordination and negations with marketing in China and ASEAN countries through trading conditions. Consequently, the suppliers will be capable of competing with Japanese and Korean medical equipment suppliers



on the international market, shaping the image of Taiwan’s excellent medical equipment quality.

Since Taiwan overlaps and competes with China and South Korea in medical equipment, the suppliers not only need to compete with foreign suppliers of medical equipment in Taiwan but also compete on the global level. In the future, Taiwan government should assists with industry upgrade in order to turn Taiwan into top choice of medical equipment manufacturing center apart from coordination and negations with marketing in China and ASEAN countries through trading conditions. Consequently, the suppliers will be capable of competing with Japanese and Korean medical equipment suppliers on the international market, shaping the image of Taiwan’s excellent medical equipment quality.

ITRI IEK Tsz-Yin ChangSenior Industry Analysis/ Research Manager

2014/04/07

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2013 Medical Equipment Industry Overview in ASEAN Markets