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The Global Fund’s China Legacy

by Yanzhong Huang
April 14, 2014

A doctor draws blood from the neck of a patient at an emergency room of a hospital in Shanghai May 15, 2013. (Aly Song/Courtesy Reuters) A doctor draws blood from the neck of a patient at an emergency room of a hospital in Shanghai May 15, 2013. (Aly Song/Courtesy Reuters)

Last week, twelve African countries met in Windhoek, Namibia to discuss the new funding model of the Global Fund to Fight HIV/AIDS, Tuberculosis (TB) and Malaria. With its emphasis on actual disease burden and flexibility, the launch of the new funding model put the final nail in the coffin of the old approach, which allocates grants based on the need of individual countries and the quality of each proposal. Indeed, even prior to the unveiling of the new funding model, the Global Fund had made China and several other G20 upper-middle income countries ineligible due to their “less than an extreme disease burden.” China, which began receiving Global Fund support in 2003, quickly became one of the Global Fund’s largest recipients. This decision hit China hard, as China had been expecting to be eligible for some $880 million in grant renewals during the 2012-16 period. Since China also decided to forego transitional funding from the Global Fund, the Fund officially closed its portfolio in China rather unceremoniously at the end of 2013.

In our working paper, Jia Ping and I explain how the Global Fund’s one-decade presence in China has left behind a deeply mixed legacy. The Fund’s money has played a vital role in boosting resources to fight AIDS, TB, and malaria in China. It has contributed to reduced growth in new HIV infections and significant drops in TB and malaria infections. And at the same time, the Global Fund has also helped bridge the normative gap between China and the global community in disease prevention and control, and, for the first time, enabled China’s civil society groups to formally participate in health policymaking.

But for the many successes, the problems and challenges are equally glaring. The Fund’s vertical, disease-specific interventions are hardly scalable or conducive to national health system strengthening. The funding model incurred significant opportunity costs and, with its emphasis on quantifiable indicators, created moral hazard. Equally important, by overemphasizing the number of civil society organizations working with the Fund and the share of funding channeled to such organizations, Global Fund programs have, at times, unintentionally hindered the healthy development of Chinese civil society. In the absence of an exit strategy for emerging powers, the Global Fund runs the risk of seeing China repeat the Russian missteps in post-Fund disease prevention and control.

Take a look at the paper and let me know what you think.

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