Global Health Aid: What

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Global Health AidWhats Ahead?

• David de Ferranti

2
Outline

• Health aid and its architecture where are we
  headed?
• Will health aid do a better job of strengthening
  country institutional settings?

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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

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Health aid has increased
and shifting to recurrent cost financing for
communicable disease control
Source Lane and Glassman 2007
5
and has gotten more complicated!
International Philanthropy
Multilateral Banks
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Volatilty ? unpredictable funding levels
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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

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X years from now

• How will todays 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 tomorrows trends have unfolded?
• Epidemics and pandemics old and new
• New products, technology, and financial tools

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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?

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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

1 Report 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. 3 Stop 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.
lthttp//www.who.int/mediacentre/events/2006/g8summ
it/malaria/en/index.htmlgt.
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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-specifi
  c 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)

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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 Practitioners Guide.
Washington, DC IBRD/World Bank. 2 Stockholm
International Peace Research Institute, 2006 3
McKinsey Global Institute, 2005
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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

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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

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

• Aid and the aid dialogue are a source of
• Financial support RECENT INCREASES COULD BE
  IMPORTANT FOR A FEW COUNTRIES BUT NOT FOR MANY.
  RISKS OF FUTURE DECLINES?
• Ideas MUCH FERMENT. HOW USEFUL???
• 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

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Why East Asia countries might care aboutwhat is
happening in global health aidREVISITED
(continued)

• And these can have implications for countries
• Help or hinder local efforts
• CHOOSE CAREFULLY WHICH GLOBAL INITIATIVESTO
  PARTICIPATE IN AND WHICH NOT.
• Absorptive capacity, fragmentation, efficiency,
  other
• PUSH BACK TAKE CHARGE WHEN DEALING WITH
  DONORS. MAKE COUNTRY-DRIVEN A REALITY.
• EVEN WITH THE WORLD BANK!

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End

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Other Money Problems Within Countries
Source WHO National Health Accounts, updated
2002.
19

Source Gottret, P. and G. Schieber. 2006.
Health Financing Revisited. World Bank.
20
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 lt 10
percent of govt. spending. Source WHO. Trend
Hodrick-Prescott filter Source Lane and
Glassman 2007
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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

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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

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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
Typical health aid dependent country
Post conflict other fragile states

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