Africa: Obstacles to AIDS Global Fund, 01/07/03

Africa: Obstacles to AIDS Global Fund, 01/07/03

AFRICA ACTION Africa Policy E-Journal January 7, 2003 (030107)

Africa: Obstacles to AIDS Global Fund (Reposted from sources cited below)

This posting contains several recent documents and links to online resources concerning the Global Fund to Fight HIV/AIDS, TB, and Malaria. The obstacles to the Fund include not only problems of implementation and refusal of the U.S. and other rich countries to provide adequate funding, but also policies in other sectors which undermine the Fund's potential. Particularly striking is the commentary below by Gorik Ooms on IMF/World Bank-imposed limits on health budgets.

See also the posting from last month on the Bush administration's most recent actions to block new trade policies on generic medicines ( Recent editorials in The New York Times (January 6, 2003) and the Guardian (December 30, 2002) strongly condemned the Bush policy. As the Times noted, "the lone holdout, the United States, blocked the deal. Washington's position is wrong and so obviously influenced by the drug companies that America is alienating nations whose support it needs on other trade issues."

Editor's note: With the new year we are making some adjustments in format and also adopting a new name for our electronic distribution list: Africa Policy E-Journal. In addition to being shorter, the new name better reflects our concept of this service as a publication providing our readers with a careful selection of current policy resources. As in the past, we will continue to rely heavily on those of you who send us relevant documents. For our selection guidelines and other background information, see
- - William Minter, Senior Research Fellow

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(1) From Africa Action

Two new 2-page fliers for use in campaign organizing (in PDF format). Suitable for printing out and copying on front-and-back of one 8 1/2" sheet.

The Global Fund to Fight HIV/AIDS

AIDS in Africa

(2) Global Fund Observer

Two new on-line resources on the Global Fund, a discussion forum and a newletter, were launched in December by the Global Fund Observer (GFO), a service of Aidspan ( GFO has an Editorial Advisory Board initially comprising ICASO, GNP+ and REDLA+ (the three organizations designated as Communications Focal Points within the Global Fund's NGO board delegations); plus Health & Development Networks (founder of the Break-The-Silence listserv, which originally covered the Global Fund); and the International HIV/AIDS Alliance. GFO is currently provided in English only. It is hoped later to provide it in additional languages.

To join the GFO DISCUSSION FORUM, send an email to Subject line and text can be left blank. (You will receive consolidated postings up to once per day, and will automatically receive the Newsletter.)

If you don't want to receive the GFO DISCUSSION FORUM, but do want to receive the GFO NEWSLETTER (about twice a month), send an email to Subject line and text can be left blank.

For more information, go to


How IMF Policies Block the Global Fund.

Gorik Ooms, Mozambique, Dec. 16, 2002 Email:

[Copyright AF-AIDS 2002 Email:]

"It is very genocidal for one part of the world to have the cure for the AIDS disease while millions of people in another part are dying from the same. The developed world is challenged to make antiretroviral drugs available", declared Uganda's President Museveni (New Vision, 11 Dec 02).

But only weeks before this declaration, Uganda's Ministry of Finance made it virtually impossible for the Ministry of Health to accept a grant from the Global Fund to fight AIDS, TB and Malaria, a grant that could help to make antiretroviral drugs available. "Any new donor monies absorbed into a government sector must be accompanied by a similar reduction within the sector in order to keep the expenditure limit", said Francis Tumuheirwe, director of budget in Uganda's ministry of finance (The Lancet, 7 Dec 02). In other words, if Uganda gets the $52 million it asked from the Global Fund, it will simply reduce its own contribution to the health budget, which will remain the same, with or without Global Fund monies. Obviously, the Global Fund will never accept this, since it can only give money for additional activities, not to replace Uganda's contribution to a fixed health budget. The solution proposed by Uganda's Ministry of Finance - to cut into other parts of the health budget to "make way" for the interventions approved by the Global Fund - is clearly not acceptable.

This means that President Museveni can call for as much international financial support for antiretroviral therapy as he wants: as long as his own Ministry of Finance is firmly committed to a public health budget that doesn't exceed $9 per person per year, "no matter how much donors are willing to provide", the inaccessibility of antiretroviral therapy - described as a 'genocide' by the President himself - will continue. It makes you wonder who the real decision-maker in Uganda is; the President or the Minister of Finance? Or is it someone working for the IMF?

Like Uganda, Mozambique has a public health budget of $9 per person per year. Like Uganda, Mozambique wants to provide antiretroviral therapy to the people who need it. Like Uganda, Mozambique is counting very much on the Global Fund to keep its people alive.

Mozambique and Uganda have poor public health budgets because they are poor countries. But also because they have accepted - or, at least in the case of Mozambique, was obliged - to adopt the IMF and World Bank economic and development doctrine, in the form of a Structural Adjustment Program (or SAP.) This doctrine is quite simple: it is based on the assumption that real development and economic growth can only occur when governments limit public spending to a percentage of their gross domestic product. In very poor countries, this has resulted in ridiculously low public health and education budgets (less than 50% of children of school age attend school in Mozambique, less than 50% of the population has access to poor public health services.)

But this would be just a temporary problem, assured the IMF and the World Bank. Soon there will be economic growth, they promised, economic growth will increase state budgets for public social services, and many people will become rich enough to buy private social services. Very conveniently, this doctrine provided an excellent excuse for reducing international aid. It was not only permitted to give less, rich countries were actually doing poor countries a favour by giving less (and thus stimulating their economic growth.) In the '90s, international aid levels dropped dramatically.

Fifteen years later, the 'temporary problem' has been solved for less than 3% of Mozambicans. They can afford private schools and private clinics. 47% have access to poor public services, badly equipped and run by underpaid civil servants. The other 50% don't send their children to school and don't go to health centers. IMF and World Bank no longer promote SAPs, they invented a new game and called it 'poverty reduction.' In theory, Poverty Reduction Strategic Papers (or PRSPs) are meant to ensure that the benefits of debt cancellation are invested directly in poverty reduction. In reality, they just protect the core of the old SAPs, ensuring that public spending remains capped. While HIV infects more and more Africans, the IMF and the World Bank ensure that African countries are not able to provide enough education to their children to protect them against HIV, let alone provide lifesaving treatment.

When African leaders, gathered in Abuja in April 2001, promised to substantially increase their public health budgets, I wondered if they realized they were defying IMF and World Bank policies. I felt relieved when I read the 'Declaration of Commitment on HIV/AIDS' that came out of the UNGASS meeting in June 2001. The international community was actually supporting increased public spending to fight AIDS and other infectious diseases! The fulfilment of this commitment would require improved health and education services! Then came the report of the WHO Commission on Macroeconomics and Health; an implicit but clear condemnation of IMF and World Bank policies, arguing that increased spending on health would not harm but rather stimulate economic growth. When the Global Fund announced its first approved proposals in April 2002, I was saddened that the Mozambican proposal was not included, but satisfied to see that similarly poor countries would receive substantial amounts, amounts that would obviously make their health budgets break through the ceilings foreseen in their respective PRSPs.

I should have been completely convinced when the World Bank Multi-sectoral AIDS Plan (MAP) team visited Mozambique for the third or the fourth time in October 2002, announcing that the MAP would be funded with a grant, not a loan, and that the World Bank had secured $1 billion for several MAPs. Surely, if this $1 billion went to the countries that need it most, it would lift their budgets well over the PRSP ceilings. Surely, if the World Bank supports such a strategy, the IMF would not challenge it. The door was open for a rights-based approach to health care and education. Suspicious as I am, I questioned the World Bank MAP team about this. Did their macroeconomists agree with this? Because if not, that $1 billion was useless, it would only replace national contributions or contributions from other donors, but not increase the budgets. The answers were vague and evasive. One said that PRSP budgets were targets, not ceilings. The other admitted that there might be a problem.

I guess we have the real answer now. No matter how much donors are willing to provide, no matter how much the Global Fund is willing to provide, Uganda will not increase its health budget and therefore it will not provide antiretroviral therapy (unless President Museveni has the courage to intervene directly.) The arguments used by Uganda's Ministry of Finance are pure IMF doctrine arguments: increasing the health budget with the Global Fund grant would destabilize Uganda's economy, the way to increase expenditure on health is through sustained economic growth, Uganda must reduce its dependence on donors. This is probably why the chairwoman of the parliamentary committee on social services wondered whether the ministry of finance or the IMF was the architect of the low ceiling.

Does it really matter? Does it really matter if the decision to sacrifice thousands of people living with AIDS on the altar of a development doctrine that has proven to be ineffective came from an office in Washington or from an office in Kampala? Does it really matter if the South African form of structural adjustment - GEAR - was voluntarily adopted by President Mbeki, strongly encouraged by the IMF and the World Bank or even imposed by them? It doesn't make any difference to South Africans, many of whom died of cholera in October 2000 because they suddenly had to pay for water and couldn't; they don't get antiretroviral treatment when they need it because of 'financial discipline' in a vain pursuit of economic growth. Does it really matter if NEPAD - the New Partnership for African Development that hardly mentions AIDS at all, let alone AIDS treatment - is the fruit of African Renaissance or the result of 20 years of indoctrination by Washington-based macroeconomists? The result is the same: poor health care and poor education for poor people.

I believe the Global Fund has met its worst enemy in Kampala. Raising the funds needed to fight AIDS, TB and Malaria remains important, but it is not enough. It must also promote a rights-based approach to social services, one that legitimises public budgets that are in accordance with real needs, not limited to a percentage of gross domestic product. Otherwise the Global Fund will end up channelling funds to relatively well-performing countries only, while refusing agreements with the countries that really need it, because their budgets are capped and Global Fund money would only replace national contributions or contributions from other donors and would not create additional services.

Both objectives, to raise more money and to create a climate that allows spending it where it is needed most, go hand in hand. Both require a new development vision. Both require a genuine understanding that only a healthy and well-educated population can create real and sustainable economic growth. Both require a genuine understanding that access to treatment is a human right!


posting by Brook K. Baker,, Health GAP, USA 2 Jan 2003 Reproduced from the Global Fund Observer Discussion Forum (, a service of Aidspan.

[The following post is in response to a 16 December 2002 posting (above) by Gorik Ooms on the AF-AIDS listserv. - GFO Discussion Forum Moderator]

Gorik Ooms wrote about an important issue when he discussed the indirect and behind-closed-door impact of IMF/WB structural adjustment programs and poverty reduction strategy plan requirements on health care budgets. Specifically, he recited instances where finance ministers stated that Global Fund moneys were going to replace, rather than supplement, other public health expenditures, presumably because of neo-liberal caps on public spending on health and/or because of conditions on use of foreign funds for recurrent public health expenditures. Although Gorik reported on Uganda, the same problem occurred in Tanzania.

It would be very helpful if the Global Fund would issue a formal statement on "additionality" that expressly challenges these IMF/WB ceilings. In order to develop medical capacity for VCT and treatment, substantially more funds must be spent on medical training, clinic construction, equipment purchases, expansion of drug distribution systems, and human expertise. In addition, medical salaries must be raised in the public sector to reduce the brain drain of trained personnel (which should be the subject of another Global Fund policy announcement along with a condemnation of rich country recruiting of medical personnel). And finally, much more money must be spent over a long period of time on drug purchases.

Certainly, the Global Fund has a very sound policy on additionality. And it should be commended for standing up to Uganda at a time it was being criticized for not getting more Round 1 money out the door quicker. What it hasn't done, however, is issue a condemnation of IMF/WB policies that place spending ceilings that then work their way down to finance ministers and CCM's. On the one hand, the World Bank is now giving grants for AIDS infrastructure projects, but its SAP's (and the IMF's) still inhibit the "vision" of neo-liberal bureaucrats in developing countries. It would be great if the Fund actually "spoke out" against some of the impediment to treatment that are structural as well as fiscal. It should adopt such a statement at its next meeting the end of this month.

Is there any way to get this issue on the Global Fund agenda? Should people on this listserve draft a letter to the Global Fund?


First Year Update - the Global Fund to Fight Aids, TB and Malaria (GFATM),

1st January 2003

Southern NGO Board Team: Milly Katana, Board Member and Rev. Fidon Mwombeki, Alternate Board Member

excerpted from posting Jan 4, 2003 on See for full posting

As we come to the end of the first year of operation of the GFATM, we wouldlike to give you a brief update on the current status of affairs.

Today, the GFATM has been able to attract $2.1B for a period of 5 years. This is a major breakthrough in resource mobilization for a global cause of this nature. The resources so far realized are indeed below the estimated annual $10B that was anticipated when the Secretary General of the United Nations, Mr Kofi Annan called for the International Community to establish a Global Fund to respond to AIDS in April 2001.

In the past year, the GFATM has approved 54 proposals from the first round of proposals for a period of 2 years. The total investment in these projects is approximately $620M. A second invitation of proposals was issued in July 2002 and a total number of 150 proposals worth approximately $1.1B have been received. The Board will meet at end of January 2003 to make decisions on these proposals. We have received information that NGOs proposals had major difficulties in getting endorsement especially for proposals that were targeting access to HIV/AIDS treatment.

The GFATM Secretariat and the Chairperson have been able to enter into four grant agreements. By end of January 2003, which will be the first Anniversary of the Fund, a total of 20 grant agreements will be made from the first round of proposals. It has taken long, from April 2002 when the board approved the proposals from eth first round, due to logistical arrangements that had to be negotiated by the Secretariat and the recipient projects. It has been a tiring process characterized by a lot of innovation and often disagreements between in-country parties. Such disagreements, in a few cases have led to slowed-down processes until the partnerships have been streamlined and strengthened. With the enormous wealth of experience that has been accumulated from managing the first round of proposals in the first year, it is anticipated that the second round agreements and those remaining from the first round will be reached relatively faster. Indeed each proposal is handled on a case-by-case basis, but experience is available to draw lessons from.

There are still approved NGO proposals from the first round for which grant agreements cannot be made yet due to lack of endorsement by country coordinating mechanisms (CCMs), as required by the GFATM. The NGO board members, like all the other board members, are greatly concerned about this delay, which is frustrating the efforts of the civil society community to effectively participate in grassroots response to HIV/AIDS, TB and Malaria. ...

During the first year, the Latin American Network of People Living with HIV/AIDS (REDLA+) kindly offered to serve as the Communication Focal Point for the Southern NGO Board team. REDLA has done a commendable job of backstopping the board member and the alternate on all matters related to interfacing with the GFATM secretariat and the communities. Particular recognition is made of LACCASO - the Latin American Network who have facilitated the interaction between eth board team and the Spanish-speaking Communities.

We request you to consider the following actions during 2003:

i. Continue putting up the case and remind the world of the business sense of investing in alleviating the impact of HIV/AIDS, TB and malaria. Particular efforts should be made to reach governments in the South and the private sector as effective stakeholders' to invest in the GFATM.

ii. Remind parties who have pledged resources to the GFATM to make good their pledges on time so as to channel resources to the second round of proposals which will be approved in January 2003.

iii. Effective participation at the country level processes to reflect the private-public partnership philosophy of the GFATM at the global level

iv. Supporting the effective use of the resources channeled by the GF to scale up intervention at country level.

We thank all colleagues who have supported us during the first year and wish you all a fruitful 2003.

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Message-Id: <> From: "Africa Action" <> Date: Tue, 7 Jan 2003 10:16:22 -0500 Subject: Africa: Obstacles to AIDS Global Fund

Editor: Ali B. Ali-Dinar

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