Washington — New funding opportunities for HIV/AIDS and tuberculosis (TB) facilities in Ethiopia will open under an initiative announced by U.S. Agency for International Development (USAID) Administrator Rajiv Shah at an AIDS research conference July 27.
According to USAID, the initiative represents an innovative approach to sustainable development by inspiring banking confidence in the health sector.
“This agreement is a historic initiative and an outstanding example of U.S. government cooperation that could produce meaningful results in the fight against HIV/AIDS,” Shah said. “By validating the strength of borrowers in the health sector, private financial institutions can make smart investments that could ultimately save more lives while sustaining country-led development and innovation.”
The initiative aims to use USAID’s Development Credit Authority (DCA) and the U.S. Department of State’s Office of the U.S. Global AIDS Coordinator to encourage private sector funding for health facilities that deliver HIV/AIDS and TB services.
HIV/AIDS is a major development challenge for Ethiopia, where, according to USAID, approximately 1.1 million people are living with the disease. Ethiopia’s private health sector is growing, although very few providers currently offer HIV/AIDS and TB services.
Ethiopia’s first reported case of HIV was in 1984. Since then, the disease has become a major public health concern in the country, prompting the Ethiopian government to declare a public health emergency in 2002.
Over the last few years, the Ethiopian government has increased efforts toward universal access to HIV prevention, treatment, care and support, emphasizing local involvement and decentralization. Shortages of real estate and cash have constrained expansion of private clinics, hospitals and laboratories, despite increased investment in health care.
Ethiopia ranks seventh among the world’s 22 high-tuberculosis-burden countries. According to the World Health Organization’s Global TB Report 2009, the HIV/AIDS epidemic fuels TB incidence, and approximately 17 percent of all adults with TB are HIV positive.
Under the initiative, $2.3 million of the Department of State’s AIDS funding could be used to support guarantees to local banks, releasing up to $13.5 million in private capital for AIDS relief in Ethiopia.
DCA is a tool that USAID missions use to stimulate lending through partial credit guarantees. USAID uses it to encourage banks to lend to creditworthy but underserved borrowers. USAID expects access to this additional funding will encourage health care providers to expand services for people living with HIV/AIDS and TB.
Through USAID, Ethiopia received $206 million in 2009 for HIV/AIDS programs and services. USAID executes HIV/AIDS programs in Ethiopia as part of the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR).
Launched in 2003, PEPFAR is the U.S. government’s initiative to support partner nations around the world in responding to HIV/AIDS. Through PEPFAR, the U.S. government has committed approximately $32 billion to bilateral HIV/AIDS programs during its first seven years of operation.