HHG’s investments and its impact on Cyprus' health sector

The unnecessary noise surrounding the Hellenic Health Group’s (HHG) investments in Cyprus’ healthcare sector is like a ticking time bomb on the foundations of what the country has been trying to build all these years to attract foreign investments.

On 30 October, opposition AKEL’s general secretary Stefanos Stefanou told the 3rd Economic Forum that the public health sector was under serious threat from a monopoly brought on by a foreign fund's “aggressive” takeovers of local hospitals.

He was referring to HHG, the Greek, globally renowned healthcare group that recently acquired the Apollonio and Aretaeio private hospitals in Nicosia, while the Commission for the Protection of Competition (CPC) has green-lit its acquisition of 50% of the equity capital of American Medical Center (AMC).

“There will be a lot of problems if the government doesn’t take action, because with its dominant market position, this monopoly will be able to impose its own terms, turning the character and philosophy of the GHS (general health system) on its head, at the expense of society,” Stefanou told delegates.

But market experts told InBusinessNews that statements like the above, not only are far from the truth, but also act as a deterrent to foreign investors wishing to invest in our country.

In fact, InBusinessNews’ has cited sources to report that the furore being created lately has not gone unnoticed by HHG, which is quite concerned.

Thankfully, the group is not considering changing its investment plans for Cyprus; for now. Its next steps will depend on how things pan out on the domestic front.

And so it is clear as day that baseless concerns like these make investors have second thoughts, and considering that Cyprus is actively seeking to attract quality foreign investments to the island, in all sectors, it is imperative that everyone involved is particularly careful with what they say; whether they are MPs or the Health Insurance Organisation (HIO), or whoever. Because this discourages the big investment funds from investing in Cyprus.

It is clearly a paradox to have the state on the one hand making a huge effort to attract big investment funds and firms to boost our economy’s competitiveness, and on the other to keep opposing them in any possible way.

The case of HHG

Especially in the case of HHG, the discussion currently underway is just for show, as it hasn’t been proven, nor does it seem that the group is acting in violation of any laws or regulations in Cyprus.

With its Cyprus investments, HHG now owns 170 beds out of a total of 3,500 beds in the country, which corresponds to just 5%, as well as 10 surgeries out of the hundreds that exist in Cyprus.

Based on this, one might reasonably ask why there should be such a great deal of concern about the group's investments, and where is the oligopoly or monopoly that some claim it promotes?

Also, why such concern over an investment in the American Medical Center, a hospital that is not in the General Health System (GHS)? How does this create a monopoly or oligopoly?

It is worth noting that HHG fully respected the local laws, explicitly followed the procedures of the Commission for the Protection of Competition and waited to receive all the necessary approvals before proceeding with the acquisition of either part or all of the equity capital of the aforementioned hospitals.

In fact, the HIO itself has confirmed that HHG has never exploited its current market standing to negotiate or seek anything to its benefit.

To the contrary, the group has consistently maintained the same level of professionalism since it acquired the hospitals, immediately proceeding with upgrades at Apollonio and Aretaeio with the sole purpose of improving patient care.

At the same time, aware of Cyprus’ investment destination potential, HHG is considering more takeovers and equity participation in other hospitals and healthcare providers.

So, given that the laws and procedures of the state are there to be adhered to and not to be interpreted as one sees fit, it is imperative that Cyprus’ reputation and potential as an investment destination – in all sectors, but especially the very promising and rapidly growing healthcare sector – are protected by all means necessary.