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TORONTO , August 13, 2006

THE INNOVATIVE FINANCING IN ACHIEVING UNIVERSAL ACCESS A framework for analyzing innovative financing methods. TORONTO , August 13, 2006. Friends of the Global Fund Europe. THE NEW FINANCING SOURCES GOALS. New financing sources to supplement ODA commitments ->To reach the Millenium Goals

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TORONTO , August 13, 2006

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  1. THE INNOVATIVE FINANCING IN ACHIEVING UNIVERSAL ACCESSA framework for analyzing innovative financing methods TORONTO , August 13, 2006 Friends of the Global FundEurope

  2. THE NEW FINANCING SOURCES GOALS New financing sources to supplement ODA commitments ->To reach the Millenium Goals ->To achieve universal access to treatment by 2010 To meet these goals : • « global » financing methods ( IFF) facing the global needs ( health, education…) • « targeted methods and goals » ( IFF / immunization and airticket levy /IDPF) Friends of the Global FundEurope

  3. Maximize domestic resources Retain resources inside developing countries DEBT CANCELLATION LEVERS FOR AID EFFICIENCY AIR TICKET LEVY ODA Supplementvolumes INNOVATIVE FINANCING Drugs / tests EXTERNAL RESOURCES IFFi Friends of the Global FundEurope Vaccines (S.KAPOOR)

  4. INNOVATIVE METHOD EFFICIENCY - REQUIREMENT #1 « RESOURCES ADDITIONNALITY and VOLUMES» RESOURCES ADDITIONALITY • The new sources of financing must be additional to the commitments taken to reach an ODA target of 0.7% of the GNP. => • To increase the quantity and the quality of resources available to developing countries • To accelerate and secure the financing aid flow • To improve ODA efficiency, taking into account the existing weaknesses • To think in a better way the financing and the use of the financing Friends of the Global FundEurope

  5. INNOVATIVE METHOD EFFICIENCY - REQUIREMENT #2«STABILITY and PREDICTABILITY » • To avoid the instability and the unpredictability of the developed country aid (budgetary burden, financing priorities shifts, disbursement delays, funding and grant use conditionality) • To open perspectives and visibility in the developing countries programs by covering several years • To allow anticipation and fitness between resources and expenses, • To initiate “a virtuous circle” with : -> a stable and predictable environment -> the improvement of aid absorption capacity -> the establishment of a secure home policy -> private investments -> and finally economic growth. Friends of the Global FundEurope

  6. INNOVATIVE METHOD EFFICIENCY - REQUIREMENT #3 «ECONOMIC EFFICIENCY of the innovative financing sources» • Economic efficiency and acceptability depend on: • FLEXIBILITY: ability to take into account the development level, geographical or economical constraints of countries that implement it • NEUTRALITY : ability to avoid economic distortions : impact on the economic competition, penalization or modification of behaviour ( consumer / investor). • FAIRNESS : a fair share of the fruits of globalization • LOW COSTS OF IMPLEMENTATION • Innovative sources of financing could be combined to raise the contribution flow and to fit better with the developing countries needs Friends of the Global FundEurope

  7. INNOVATIVE METHOD EFFICIENCY - REQUIREMENT #4«RELEVANCE  of the innovative financing sources » • New approaches to face new challenges • A better quality aid :- an opportunity to better think financing - need - use of the financing - to better allocate resources, disburse funds and evaluate results • Cost-effective approach to finance special or neglected needs : visibility, volumes, scaling up… • To take advantage of targeted volumes : forecasts, competition, price negotiations, production capacities, information… Friends of the Global FundEurope

  8. GOVERNANCE EFFICIENCY - REQUIREMENT #1 International coordination(1) To promote a new international governance built on Solidarity and Partnership : - Donors coordination: National decision and international coordination to implement innovative methods - Recipients coordination: National decision and international coordination to implement programs - Representation of developed and developing countries / donors and recipients / governments / NGO / private sector / civil society - Visibility and transparency Friends of the Global FundEurope

  9. GOVERNANCE EFFICIENCY -REQUIREMENT #1 International coordination(2) NEW IDEAS and NEW VIEWS • No additionnal organizational costs • No additionnal time and delay • No conditionality • No overlap costs • No additionnal requirements ( harmonization of inquiries, reporting documents, evaluations…) • Each of them are lost lives Friends of the Global FundEurope

  10. GOVERNANCE EFFICIENCY - REQUIREMENT #2 Subsidiarity • Better define responsibility and financing levels • Encourage domestic development strategies • Involve local entities, NGO and private sector representatives to increase capaticity building and absorptive capacity Friends of the Global FundEurope

  11. GOVERNANCE EFFICIENCY - REQUIREMENT #3 :Visibility and transparency • Needs assessment • Budgetary transparency both with donors and recipients • Reporting and feedback from developing countries and donors • Evaluation Friends of the Global FundEurope

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