Best of 2012: Sobhi A Batterjee interview

The Arab world’s healthcare industry is fraught with government red tape and bureaucracy but as Sobhi A Batterjee, president and CEO of the Saudi German Hospitals Group, tells Arabian Business, it will take more than that to halt his expansion plans

The walls of Sobhi A Batterjee’s majlis may be lined with photographs documenting his business achievements, but in pride of place is the photograph of him standing beside Dubai’s ruler Sheikh Mohammed Bin Rashid Al Maktoum as he officially opens the Saudi German Hospitals Group’s $109m medical facility in Dubai.

The photograph, featuring the March inauguration of the state-of-the art hospital, is important for several reasons. Not only does it represent Dubai’s increasing interest in establishing itself as a regional hub for medical tourism, it also signifies the growing importance that Batterjee, the president and CEO of the Jeddah-based SGH, is placing on Dubai as he seeks to use the emirate as a springboard to launch its ambitious expansion plans.

“In the Arab world, the top people have good intentions to build the country but the regulatory [environment] is something different; the vision is not coming down. In the Emirates, the vision is being transmitted down — that’s the difference,” Batterjee tells Arabian Business.

If Batterjee’s statement seems rather vague, it soon becomes clear as he begins to document the continued problems the healthcare provider has faced in its bid to establish itself as a regional healthcare powerhouse. Batterjee had hoped the firm would operate 30 hospitals and employ 50,000 staff by 2015, and integrate five medical colleges by 2020, but he says it is unlikely to happen in that timeframe.

“I am so frustrated I cannot tell you. The Arab world, with the exception of the Emirates, is like a lion in a golden cage; [it has] lots of opportunities but they cannot be achieved,” he says. “Healthcare is very restricted, the regulations and the regulatory environment of healthcare is really difficult. Building a hospital is not the same as building a hotel,” he adds.

The Batterjee family has been offering healthcare services in Saudi Arabia since the 1940s when Sobhi Abdul Galal Batterjee operated a pharmaceuticals company. In 1988, his son established the SGH (so called because of its aim to introduce German healthcare standards to the kingdom) with a paid-up capital of $15m. Today, the firm operates six hospitals in Saudi Arabia, Yemen and the UAE — which treat over a million patients annually — and has twelve hospital projects across the Arab world, including Morocco, Pakistan and Syria, either in the planning or construction phase.

Red tape and bureaucracy in Saudi Arabia have, however, delayed many of Batterjee’s plans in his home market. Restrictions on private-sector investment have delayed the opening of a $533m multi-specialty hospital in Saudi Arabia’s north-central province of Hail, forced the group to close the doors of its charity blood bank and stopped hundreds of medical students from enrolling at its three medical colleges.

The group has faced similar issues with its plans for not-for-profit hospitals, which it is developing in association with the Nobel Peace Prize recipient Muhammad Yunus, the microfinance organisation Grameen Bank, Islamic Development Bank, General Electric and CCC. “I am telling the [Arab] governments that I want to do something for free but they won’t let me,” explains Batterjee.

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