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Africa: Investing in Health
Africa: Investing in Health
Date distributed (ymd): 011221
Document reposted by APIC
Africa Policy Electronic Distribution List: an information
service provided by AFRICA ACTION (incorporating the Africa
Policy Information Center, The Africa Fund, and the American
Committee on Africa). Find more information for action for
Africa at http://www.africapolicy.org
###############################################################
NOTE FROM AFRICA ACTION
This is the last posting of the year from the Africa Policy
Electronic Distribution List. Postings will resume in the second
week of January. Africa Action offices will also be closed from
next week until January 7.
Reports such as the one in this posting remind us that much of the
agenda for what needs to be done to advance human security in
Africa is well known. Whether action is taken, however, depends on
political will. That in turn depends on whether pressure from
around the world to act reaches a critical mass. We look forward to
continuing this struggle together with you in the coming year.
We thank those of you who are already supporters of Africa Action,
and have sent in contributions this year to support our work. If
you have not yet done so, you can contribute on-line or print out
a contribution form at:
http://www.africapolicy.org/join.htm
Contributions to Africa Action are tax-deductible under U.S. tax
law.
Over the next week we will be shifting our primary web site
address to http://www.africaaction.org. The site will be the same,
and links using either the old or the new names should both
continue to work. However, a few of you may experience temporary
difficulties in reaching the site as domain name servers on the
internet adjust to the change.
+++++++++++++++++++++Document Profile+++++++++++++++++++++
Region: Continent-Wide
Issue Areas: +economy/development+ +security/peace+ +health+
SUMMARY CONTENTS:
This posting contains the press release and "key findings" from the
executive summary of the report by the World Health Organization
Commission on Macroeconomic and Health, released on Dec. 20, 2001.
The WHO website has available the full report, as well as working
papers prepared for the Commission during its two years of work.
The working papers, by economists and health experts, provide a
wide variety of documentation for the conclusions of the Commission
and in particular for the economic benefits of public investment in
health at global, national, and local levels. One paper by
commission economist D. Arhin-Tenkorang on "Mobilizing Resources
for Health," for example, provides theoretical as well as
empirical arguments noting the negative impact of user fees on
public health, and stresses that both international and global
investment is necessary to fill the funding gap, while locally
based insurance schemes could be significant in the longer term.
+++++++++++++++++end profile++++++++++++++++++++++++++++++
World Health Organization
Press Release
Commission on Macroeconomics and Health
http://www.who.int/cmhreport
Investment in Global Health Will Save 8 Million Lives a Year and
Generate at Least a $360 Billion Annual Gain within 15 Years,
Says a New Report Presented to WHO
20 December 2001
A drastic scaling up of investments in health for
the world's poor will not only save millions of lives but also
produce enormous economic gains, say experts in a landmark Report
presented today to the World Health Organization (WHO).
A group of leading economists and health experts maintain that, by
2015-2020, increased health investments of $66 billion per year
above current spending will generate at least $360 billion
annually. About half of this will be as a result of direct economic
benefits: the world's poorest people will live longer, have many
more days of good health and, as a result, will be able to earn
more. The other half will be as a consequence of the indirect
economic benefits from this greater individual productivity. It
will mean a total economic gain of at least US $360 billion per
year - a six-fold return on the investment.
To achieve this, the experts state that a dramatic increase in
resources for health over the next few years is needed. About half
of the total increase would have to come from international
development assistance, while developing countries would provide
the other half by re-prioritizing their budgets.
"With bold decisions in 2002, the world could initiate a
partnership between rich and poor of unrivalled significance,
offering the gift of life itself to millions of the world's
dispossessed and proving to all doubters that globalization can
indeed work to the benefit of all humankind," the 18 members of the
Commission on Macroeconomics and Health write in a joint foreword
to their Report. The investment plan, they conclude, is needed to
meet the Millennium Development Goals for health agreed by the
international community at the Millennium Summit of the United
Nations in September 2000.
The Report, Macroeconomics and Health: Investing in Health for
Economic Development, was presented today by the chair of the
Commission, Professor Jeffrey D. Sachs, to Dr Gro Harlem
Brundtland, Director-General of the World Health Organization.
In 1999 Dr Brundtland, who chaired the UN Commission on
Environment and Development 15 years ago, invited Dr Sachs to chair
a commission of 18 leading economists and senior public health
experts. The Commissioners worked for two years to produce their
Report. Six expert working groups supported them in this task.
The Report argues that the links between health, poverty reduction
and economic growth are much more powerful than has been generally
understood. The Commissioners use clear scientific evidence to
challenge the traditional argument that health will automatically
improve as a result of economic growth. Their Report shows that the
opposite is true: improved health is a critical requirement for
economic development in poor countries.
Scaled-up Investments Needed
One of the key recommendations of the Commission is that the
world's low-and middle-income nations, in partnership with highincome
countries, should scale up access to essential health
services for the world's poor. The focus should be on specific
measures to control the deadliest and most debilitating diseases.
The current level of official development assistance (ODA) for
health stands at around US $6 billion per year. This donor support
should be increased to US $27 billion per year by 2007 according to
the plan laid out by the Commission. The increase would allow for
vastly greater health care for the poor, as well as stepped up
efforts in research and development for new technologies to fight
the diseases of the poor. Much of the aid would be directed towards
sub-Saharan Africa, where the health emergency is most severe.
The low-and middle-income countries, on their part, would need to
commit additional domestic financial resources, political
leadership, transparency, and mechanisms for community involvement
and accountability to ensure that adequately financed health
systems can operate effectively and address the key health problems
of the poor.
Under the plan, donor and recipient countries would enter into a
new 'health pact' based on mutual trust and monitored performance.
Contributions for health from highincome countries would amount to
approximately 0.1 per cent of their GNP. Developing countries would
aim to raise domestic budgetary spending on health by an additional
1 per cent of GNP as of 2007, rising to 2 per cent in 2015.
Spending would be aimed at the main illnesses of poverty such as
malaria, tuberculosis, HIV/AIDS and childhood diseases.
The new 'health pact' proposed by the Report would redefine the
relationship between donor and recipient countries. Under the pact,
international financing of health - and the mechanisms of donor
financing - would evolve to include increased debt relief and
increased mobilization of tax revenues for health.
The Report foresees a major role for the planned Global Fund to
Fight AIDS, Tuberculosis, and Malaria, and proposes the
establishment of a new Global Health Research Fund to ensure needed
research into new medicines and vaccines for diseases that
disproportionately affect the poor.
"With globalization on trial as never before, the world must
succeed in achieving its solemn commitments to reduce poverty and
improve health," say the Report's authors. "The resources- human,
scientific, and financial- exist to succeed, but now must be
mobilized." In the present environment, "it is all the more
important that the world commit itself to sustaining millions of
lives through peaceful means, using the best of our modern science
and technology and the enormous wealth of the rich countries. This
would be an effort that would inspire and unite peoples all over
the world."
Differential Pricing of Medicines Should be the Norm - Not the
Exception
The Commission outlines a new global framework for access to lifesaving
medicines that includes norms on differential pricing
schemes, broader licensing, and bulk purchase agreements.
The Report considers differential pricing in low-income markets
the best solution to ensure access to essential drugs in poor
countries. Under differential pricing, rich countries bear the
costs of research and development, while poor countries pay only
the "baseline" costs of production.
The Report also calls for WHO, the pharmaceutical industry (both
patent holders and generic producers), and low-income countries to
agree jointly on guidelines for pricing and licensing of production
in low-income markets to ensure access to essential medicines.
This is very much in the spirit of decisions taken at the World
Trade Organization's Ministerial Conference in Doha during
November. Delegates agreed to put emphasis on the public health
needs of the poor within international trade rules.
The industry would agree to license their technologies to producers
of highquality generic pharmaceuticals for supply to low-income
countries under two conditions - when they choose not to supply
those markets themselves or when the generics producers can
demonstrate that they can produce high quality drugs at a markedly
lower cost.
Finally, TRIPS (the agreement on trade-related aspects of
intellectual property rights) safeguards would be interpreted
broadly to ensure that even those poor countries that cannot avail
themselves of domestic production of pharmaceuticals through
voluntary or compulsory licensing can still be assured of access to
generic production from third countries.
The Report stresses, however, that the larger problem of poverty,
the lack of effective procurement and distribution systems, and the
inability to effectively prescribe the right medications are often
greater impediments to a wider access to life-saving medicines
than patent rules.
Disease Provokes Instability
Commissioners note that, as the world embarks on a heightened
struggle against the evils that destabilise our societies, there is
an increasing commitment, from world leaders, to the peaceful
empowerment of millions of people whose lives are threatened by
suffering and disease.
Studies demonstrate that there is a strong correlation between
"State failure" (in which governments fail because of the
disintegration of State functions, coups, or civil war) and high
rates of infant mortality. By helping to control the diseases of
the poor, wealthy countries will also benefit from the resulting
political and social stability and faster economic growth in the
developing world.
The Report indicates ways in which globalization contributes to
the spread of diseases. Studies suggest that a small increase in
movement across borders (e. g., due to tourism, migration, business
travel or flows of refugees) substantially increases the
transmission - and incidence - of infectious diseases.
A Few Health Steps Could Save Millions of Lives
According to 1998 data, almost a third of deaths in low-and
middle-income countries are due to communicable diseases, maternal
and perinatal conditions and nutritional deficiencies. These can
both be prevented and treated.
Just a few diseases account for most of this ill health. These are
HIV/AIDS, tuberculosis, malaria, childhood diseases, unsafe
pregnancy, infant illness at the time of delivery and tobaccorelated
illnesses. Malnutrition exacerbates these diseases
Effective interventions for the prevention and control of these
conditions already exist. Large reductions in mortality and
morbidity can be achieved almost anywhere, even in war zones. Only
10 per cent of the world's poor people live in countries where
there is no infrastructure at all and the scaling up of health
interventions will prove to be particularly challenging. However,
it is feasible for countries to scale up health interventions for
the vast majority of the world's poor people provided that
financial resources are adequate. The Commission therefore
recommends that donors should indeed invest amply in a bold process
to strengthen the effective operation of health systems.
The Commission also shows that the highest priority for scaling up
is at the community level, where actual health services are
delivered. The Report terms this the close-to-client, or CTC part
of the health system. Scaling up at the CTC level involves a basic
strengthening of staffing at this level, an adequate supply of
drugs, and an increased capacity for transport and connection with
the rest of the health system.
The resources and know-how exist to save millions of lives, turn
the tide on global ill health and poverty, and harness global
economic development. The Commission asserts that the countries of
the world cannot afford to pass by the present opportunities for
effective action. Their legacy will benefit countless future
generations and help safeguard the health of the people and the
planet.
Contact:
Professor Jeffrey D. Sachs
CMH Chair Director,
Center for International Development
Harvard University
79 John F. Kennedy Street
Cambridge, MA 02138 USA
Tel. No.: +1-617 495 4112 Email: jeffrey_sachs@harvard.edu
Daniela Bagozzi
Office of the WHO Press Spokesperson
Tel: 41 22 791 4544 Mobile: 41 79 475 54 90
E-mail: Bagozzid@who.int
Hard copies of the report can be obtained from:
The World Health Organization Marketing and Disseminiation 1211
Geneva 27, Switzerland Tel: (41-22) 791 2476 Fax: (41-22) 791
4857 email: bookorders@who.int
Macroeconomics and Health: Investing in Health for Economic
Development
Table 2. Key Findings on the Linkages of Health and Development
- Health is a priority goal in its own right, as well as a central
input into economic development and poverty reduction. The
importance of investing in health has been greatly underestimated,
not only by analysts but also by developing-country governments and
the international donor community. Increased investments in health
as outlined in this Report would translate into hundreds of
billions of dollars per year of increased income in the low- income
countries. There are large social benefits to ensuring high levels
of health coverage of the poor, including spillovers to wealthier
members of the society.
- A few health conditions are responsible for a high proportion of
the health deficit: HIV/ AIDS, malaria, TB, childhood infectious
diseases (many of which are preventable by vaccination), maternal
and perinatal conditions, tobacco- related illnesses, and
micronutrient deficiencies. Effective interventions exist to
prevent and treat these conditions. Around 8 million deaths per
year from these conditions could be averted by the end of the
decade in a well-focused program.
- The HIV/ AIDS pandemic is a distinct and unparalleled
catastrophe in its human dimension and its implications for
economic development. It therefore requires special consideration.
Tried and tested interventions within the health sector are
available to address most of the causes of the health deficit,
including HIV/ AIDS.
- Investments in reproductive health, including family planning
and access to contraceptives, are crucial accompaniments of
investments in disease control. The combination of disease control
and reproductive health is likely to translate into reduced
fertility, greater investments in the health and education of each
child, and reduced population growth.
- The level of health spending in the low-income countries is
insufficient to address the health challenges they face. We
estimate that minimum financing needs to be around $30 to $40 per
person per year to cover essential interventions, including those
needed to fight the AIDS pandemic, with much of that sum requiring
budgetary rather than private- sector financing. Actual health
spending is considerably lower. The leastdeveloped countries
average approximately $13 per person per year in total health
expenditures, of which budgetary outlays are just $7. The other
low- income countries average approximately $24 per capita per
year, of which budgetary outlays are $13.
- Poor countries can increase the domestic resources that they
mobilize for the health sector and use those resources more
efficiently. Even with more efficient allocation and greater
resource mobilization, the levels of funding necessary to cover
essential services are far beyond the financial means of many lowincome
countries, as well as a few middle-income countries with
high prevalence of HIV/ AIDS.
- Donor finance will be needed to close the financing gap, in
conjunction with best efforts by the recipient countries
themselves. We estimate that a worldwide scaling up of health
investments for the low-income countries to provide the essential
interventions of $30 to 40 per person will require approximately
$27 billion per year in donor grants by 2007, compared with around
$6 billion per year that is currently provided. This funding should
be additional to other donor financing, since increased aid is also
needed in other related areas such as education, water, and
sanitation.
- Increased health coverage of the poor would require greater
financial investments in specific health sector interventions, as
well as a properly structured health delivery system that can reach
the poor. The highest priority is to create a service delivery
system at the local ("close-to-client") level, complemented by
nationwide programs for some major diseases. Successful
implementation of such a program requires political and
administrative commitment, strengthening of country technical and
administrative expertise, substantial strengthening of public
management systems, and creation of systems of community
accountability. It also requires new approaches to donor/ recipient
relations.
- An effective assault on diseases of the poor will also require
substantial investments in global public goods, including increased
collection and analysis of epidemiological data, surveillance of
infectious diseases, and research and development into diseases
that are concentrated in poor countries (often, though not
exclusively, tropical diseases).
- Coordinated actions by the pharmaceutical industry, governments
of low-income countries, donors, and international agencies are
needed to ensure that the world's low-income countries have
reliable access to essential medicines.
This material is being reposted for wider distribution by
Africa Action (incorporating the Africa Policy Information
Center, The Africa Fund, and the American Committee on Africa).
Africa Action's information services provide accessible
information and analysis in order to promote U.S. and
international policies toward Africa that advance economic,
political and social justice and the full spectrum of human rights.
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