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Global Health Aid: What’s Ahead?. David de Ferranti. Outline. Health aid and its architecture: where are we headed? Will health aid do a better job of strengthening country institutional settings?. Why East Asia countries might care about what is happening in global health aid.

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Global Health Aid: What’s Ahead?

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Global Health Aid:What’s Ahead?

David de Ferranti


  • Health aid and its architecture: where are we headed?

  • Will health aid do a better job of strengthening country institutional settings?

Why East Asia countries might care aboutwhat is happening in global health aid

  • Aid and “the aid dialogue” are a source of:

    • Financial support

    • Ideas

    • Experience from other parts of the world

    • Initiatives and advocacy – on new priorities

  • And these can have implications for countries

    • Help or hinder local efforts

    • Absorptive capacity concerns

    • Fragmentation, efficiency, other

Health aid has increased

… and shifting to recurrent cost financing for communicable disease control

Source: Lane and Glassman 2007

Official Development Assistance

Product (RED)

Debt Buy-back

Global Health Partnerships

Airline Tax

Bilateral Agencies

UN Agencies ( WHO & others)

Global Fund



Buy-downs, co-financing



Private Capital

Health Service Delivery

Public Health & Community Health

Health Financing

Individual Preventive Public Health Interventions

Data, Health Education, Environmental Health

Other Gov.

Health Strategy

Public Providers

Ministry of


Social Security




Individual Health Interventions,

Acute & Chronic Care

Private Payments

Public Providers

Private Providers

Out-of-Pocket Payments


… and has gotten more complicated!

International Philanthropy

Multilateral Banks

Volatilty  unpredictable funding levels

Changes are afoot

  • The new players are still expanding. And changing.

  • Gates and other new philanthropies

  • Global Fund, GAVI, and other disease-focused initiatives

  • Others (Media stars, wealthy individuals, the BRICs, …)

  • The traditional players are trying new ideas

  • European bilaterals (DfID, France, Nordics, …)

  • US assistance (USAID, MCC, State, PEPFAR, etc.)

  • World Bank and regional multilaterals

  • BINGOs, LNGOs, FBOs, private health providers

  • Other (IMF, overall aid strategies, recipient governments)

  • The global environment is worsening

  • US economy and “the crisis from the north”

X years from now …

  • How will today’s tensions have evolved?

  • Vertical programs vs. health systems

  • Country-driven vs. donor-driven

  • Performance-based vs. input-focused

  • General support vs. project-oriented

  • Public vs. private roles in health

  • The trans-Atlantic divide

  • How will tomorrow’s trends have unfolded?

  • Epidemics and pandemics – old and new

  • New products, technology, and financial tools

X years from now … (continued)

  • Will the global health architecture have changed radically?

  • By default rather than by design?

  • Will support (public, political) for aid have weakened?

  • Impact of new generations of voters? Is a funding “cliff” coming?

  • Will the new players have achieved results?

  • Or changed the debate?

  • Or foundered on unrealistic expectations?

  • Or changed their own views of what is needed and what works?

  • Will the traditional players have changed?

  • Will aid be just IDA-type funding plus IFC-type support?

  • Will there be enough money to meet the priority needs?

The Great “Money Gap” Debate

  • UNAIDS says $55.1 bn is needed for 2006 - 2008 for HIV/AIDS

    • Funding gap: $6 bn in 2006 and $8.1 bn in 2007 1

  • GAVI: $35 bn to immunize 27 mn children by 2015

    • Funding gap: $11-15 bn 2

  • StopTB: $56.1 bn over 10 years

    • Funding gap: $30.8 bn 3

  • Maternal and Neonatal Health and Child Survival: $9 - 16 bn/yr

    • Funding gap: $5 bn/yr

  • Roll Back Malaria: $3.4 bn/yr

    • Funding gap: $2.7 bn/yr 4

1Report on the Global Aids Epidemic. Geneva: Joint United Nations Programme on HIV/AIDS, 2006.

2 Albright, Alice. "Innovative Financing for Global Health." The Brookings Institution, Washington. 26 July 2006.

Lob-Levyt, Julian. "Progress & Phase 2." 3rd GAVI Partners' Meeting, New Delhi. 8 December 2006.

3Stop TB Partnership. Actions for Life: The Global Plan to Stop TB 2006-2015. Geneva: World Health Organization, 2006.

4 WHO. "Who | Malaria". Geneva, 2006. World Health Organization. <>.

The Great “Money Gap” Debate (continued)

  • Adding it all up:

    • From World Bank for health-related MDG gap

    • $25 - 70 bn/yr (0.08 – 0.21% of global GDP)

    • From Commission on Macroeconomics and Health, WHO:

    • $40 - 52 bn/yr (0.08 – 0.12% of GDP)

    • From summing selected disease/intervention-specific estimates:

      $30 - 50 bn/yr (0.10 – 0.15% of GDP)

    • From Copenhagen consensus estimate of WDR 1993 package

      $337 bn/yr (1% of GDP)

The Great “Money Gap” Debate (concluded)

  • $25 to $50 bn/yr is small compared to:

  • Total health spending worldwide: $3,198 bn/yr1

  • Global military spending: $1,118 bn in 20052

  • Global corporate net profits: Exxon/Mobile alone earned $36 bn in 2005

  • Total capital in global financial markets: $118,000 bn(a stock, not a flow)3

  • But large compared to:

  • Total current development aid for health: over $11.4 bn/yr (IMF/WB, 2004)

  • Total current ODA for all purposes: $80 bn/yr (OECD, 2004)

  • Total current health spending in recipient countries: $350 bn/yr1

  • And would be needed for a very long time

  • So …this is too big to solve by aid and philanthropy alone

1 Gottret, P. and George Schieber. 2006. Health Financing Revisited: A Practitioner’s Guide.

Washington, DC: IBRD/World Bank.

2 Stockholm International Peace Research Institute, 2006

3 McKinsey Global Institute, 2005

Strengthening Country Institutional Settings

  • What is it?

    • Strengthening institutions such as

      • Laws and regulatory regime

      • Health workforce talent pool and incentives

      • Management systems

      • Transparency, governance

    • Similar to “enabling environment” and “investment climate” concepts in macro policy?

  • Not the same as:

    • Capacity building

    • Traditional technical assistance

Prospects for Improving Aid EffectivenessAnd Its Impact on Country Institutional Settings

  • What to expect from the new initiatives that promote:

    • Greater strategic coherence (IHP++, etc.)

    • Harmonization and alignment (Paris, Rome, etc.)

    • Results-based aid (Norway, etc.)

    • Pooling of aid (budget support, SWAps, etc.)

    • Better use of traditional tools (e.g., technical assistance)

    • Strengthening health systems

  • And from new efforts to:

    • Strengthen incentives and institutions

    • Attack demand and supply side constraints simultaneously

Why East Asia countries might care aboutwhat is happening in global health aid:REVISITED

  • Aid and “the aid dialogue” are a source of:



    • Experience from other parts of the world: A LOT TO LEARN FROM NOW. MORE COMING.

    • Initiatives and advocacy – on new priorities: MANY NEW EFFORTS. THEIR VALUE STILL UNCLEAR

Why East Asia countries might care aboutwhat is happening in global health aid:REVISITED (continued)

  • And these can have implications for countries

    • Help or hinder local efforts:


    • Absorptive capacity, fragmentation, efficiency, other:




Other Money Problems Within Countries

Source: WHO National Health Accounts, updated 2002.

Global Health Spending

Global Disease Burden

Low- and Middle-Income Countries

Low- and Middle-Income Countries

High-Income Countries

High-Income Countries

Source: Gottret, P. and G. Schieber. 2006. “Health Financing Revisited.” World Bank.

Volatile revenue flows

Average absolute percentage deviation from trend 1996-2005

US$ per capita data for 59 countries. Excludes micro states, countries where health aid < 10 percent of govt. spending. Source WHO.

Trend: Hodrick-Prescott filter; Source: Lane and Glassman 2007

Options for Change

  • Accelerate efforts to …

  • Help countries move toward stronger health systems

  • Based on more effective built-in incentives for better performance

  • Develop powerful new interventions

  • Cost-effective vaccines, programs, financing strategies, etc.

  • Improve uptake of existing interventions (new or neglected)

    • Requires focus on country health systems

  • Get more impact from

    • Success stories – from innovative country programs

    • Bridging divides between leaders and ideas

    • Evaluation of experience

  • Press key players (WB, WHO) to do better

    • New initiatives should add value

    • New initiatives should be active constituents holding main players accountable, not competitors

Four inter-linked initiatives

  • Project on Innovative Financing

    • IFFIm, airline tax, advance market commitment

    • Private sector: their role and investment

  • Task Force on Health Financing

    • Mary Robinson, Julio Frenk, Ngozi Okonjo, etc.

    • Within-country and aid-flow issues

  • Programs on Improving Implementation

    • Focus on governance, corruption, transparency, accountability

  • Private sector risk-pooling in Africa

    • Dutch government support

Country Health Aid and Spending Volatility 96-05

Developing countries that experience high aid volatility tend to be those that are most dependent on aid and aid dependency is growing

  • High/Low Threshold: 12 percent avg. deviation from trend.

Typical health aid

dependent country

Post conflict &

other fragile states

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