Global Financing for Health: Aid and Debt Relief

Abstract

Improving health equity between and within countries, as other chapters in this book discuss, requires generous social protection policies, universal forms of health system fi nancing, and investments in social determinants of health (SDH), such as education, water/sanitation, and active labormarket policies. States need to be able to raise suffi cient revenue to fund such investments, an ability that for many low-income countries has been compromised by various aspects of globalization: capital fl ight, declines in foreign direct investment, and substantial loss of tariff revenues as a result of import liberalization. In this chapter we address two specifi c forms of positive global fi nancial fl ows: offi cial development assistance (ODA), more commonly shorthanded as aid, and debt relief. While distinct, these two sets of fl ows are highly entwined and subject of intense international, scholarly, and civil society debates. These debates involve questions of adequacy, effectiveness, linkage, and conditionality. In addressing such questions, this chapter fi rst discusses general trends and issues in aid, before focusing specifi cally on aid for health. It then turns to debt fi nancing and debt relief, before concluding with how both aid and debt relief should be approached if global equity in health (and in access to SDH) is to be improved. It is important to note at the outset that debt is only one part of the web of interlinking domestic and international constraints on poverty reduction; and that aid, even when reformed for greater pro-poor disbursements, is only one means of redressing some of these constraints. Changes in trade and global governance are equally essential, and the neglect of one by emphasis on another (e.g., “trade not aid”) is unlikely to affect meaningful improvements in global health equity.

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