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Published by Oxford University Press in association with The London School of Hygiene and Tropical Medicine ß The Author 2010; all rights reserved. Advance Access publication 27 July 2010

Health Policy and Planning 2010;25:523–528 doi:10.1093/heapol/czq030

The relationships between foreign aid, HIV and government health spending Jeremy Youde Assistant Professor of Political Science, University of Minnesota Duluth, Cina Hall 304, 1123 University Drive, Duluth, MN 55812, USA. E-mail: [email protected]. Tel: þ1-218-726 6908

Accepted

19 March 2010 This paper provides an empirical evaluation of adult HIV prevalence rates, foreign aid for HIV/AIDS programmes, and the amount of government spending on health care. It finds that there exists a statistically significant relationship between adult HIV prevalence rates and the amount of foreign funding for HIV/ AIDS programmes, suggesting that need does in fact play some role in the allocation of HIV aid. It suggests there may be an additive relationship between foreign and domestic health spending, where governments turn the funding of their AIDS programmes over to foreign donors and instead put their own monies toward other parts of the health care system.

Keywords

Foreign aid, AIDS, health care spending, health budgets, donor funding

KEY MESSAGES 

There is a statistically significant relationship between adult HIV prevalence rates and funding from the US government to 15 PEPFAR target countries, which suggests that need does in fact play some role in the allocation of HIV aid.



There may be an additive relationship between foreign and domestic health spending, where governments turn the funding of their AIDS programmes over to foreign donors and instead put their own monies toward other parts of the health care system.

Introduction Is there a relationship between the severity of a country’s AIDS epidemic and the amount of money external donors provide? It stands to reason that states with higher HIV prevalence rates would receive more money from external sources. However, donor states do not always distribute proportionately with the recipient’s needs. Furthermore, recent reports have suggested that HIV receives disproportionate levels of funding compared with overall health care expenditure. In this research note, I examine the relationship between HIV prevalence, foreign donor contributions and domestic government spending on health. In particular, I focus on the US government’s spending on HIV/AIDS programmes in 15 target countries through the President’s Emergency Plan for AIDS Relief (PEPFAR). While not the entirety of the US government’s foreign aid spending on HIV/AIDS, these countries have received the greatest attention within the government’s most high-profile international health programme. By examining the centrepiece programme of the

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US government’s foreign aid for HIV/AIDS, we can start to uncover the relationships between HIV prevalence, foreign aid and domestic health spending.

Debates over aid and AIDS Since HIV’s discovery in 1981, more than 25 million people have died of AIDS. UNAIDS estimates that 33 million people worldwide are currently HIV positive, leading to a worldwide adult prevalence rate of 0.8% (UNAIDS 2008). Sub-Saharan Africa has the highest HIV prevalence rate at 5%, followed by the Caribbean (1.1%), and Eastern Europe and Central Asia (0.8%). Sub-Saharan Africa alone makes up two-thirds of the worldwide HIV burden. Swaziland has the dubious distinction of having the world’s highest adult HIV prevalence rate (estimated at 26.1%), while South Africa has the largest number of HIV-positive adults with 5.7 million. In the early 1980s, one United Nations official remarked that AIDS was

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unlikely to become part of the international agenda because most of the cases occurred among gay men in Western states that had the resources to take care of the disease on their own. Thirty years into the AIDS pandemic, that prediction has not borne itself out. Instead, many of the countries with the heaviest HIV burdens are the ones that must turn to the international community to support their health care services. Donor funding for HIV/AIDS finds itself at the nexus of three distinct debates within international politics. First, there exists a growing trend among developed states to define HIV/AIDS, and infectious disease in general, as a security issue. Starting in the late 1990s, an increasing number of states have sought to integrate global health issues into their broader security rubric. Some governments, like those in the United States and the United Kingdom, have argued that poor health can pose a direct threat to national security interests by increasing instability, weakening governmental institutions and undermining economic growth (National Intelligence Council 2000, 2002; National Security Council 2006; UK Department of Health 2008). Other states, most notably Canada and Japan, have reoriented their foreign policy strategies to embrace ‘human security’, arguing that the greatest threats to international security are those that most directly affect the lives of the majority of the world’s inhabitants (Paris 2001; Amouyel 2006; Stearns 2006). In 2000, the United Nations Security Council adopted Resolution 1308, declaring AIDS a threat to international security and marking the first time the body had ever singled out a specific disease for such treatment. Recently, though, a number of voices have called for a reassessment of the appropriateness of a security framework for HIV/AIDS and infectious disease. Turning diseases into security issues threatens to distort priorities, focusing attention only on preventing particular illnesses rather than promoting general health (Feldbaum et al. 2006; Shiffman 2008). Accordingly, these critics argue that the international community essentially creates a hierarchy of disease. Those diseases that seemingly have the most ‘security’ relevance—perhaps because of their potential as a biological weapon or their association with military personnel—receive a disproportionate amount of attention relative to the actual number of people they infect in any given year (Moran et al. 2008). If security is the driving force behind funding AIDS programmes, this may mean that states that are considered more strategically important may receive a disproportionate share of funds than their prevalence rates would suggest. Second, the role of governments in providing social services like health care has come under attack. During the 1980s, international financial institutions attached conditionalities to their grants and loans. Developing countries had to adopt Structural Adjustment Programmes (SAPs) in order to receive funding. SAPs required states to adopt neoliberal policies that pared the size of the government, introduced user fees for schools and health clinics, and increased the role of the private sector in providing social services. Proponents argued that such programmes introduced a level of accountability on recipient governments while also bringing their economies and political systems more in line with those of developed states. The private

sector could provide these services more efficiently and cost-effectively, and reducing the overall size of the government would bolster economic growth (Rapley 2002: 64–72). Opponents countered that the cuts required by SAPs targeted precisely those populations that had the fewest alternatives and most needed those services. They put social services out of reach for too many people, which further exacerbated health problems (Bond 2007). Interestingly, Bratton et al. found in their surveys in sub-Saharan Africa that people placed a higher value on government-provided health services than foreign donors did (Bratton et al. 2005: 103). Instead of benefitting the countries receiving the aid, SAPs helped the donor states by increasing their access to recipient states’ markets and natural resources. Finally, the role of foreign aid in general has come under increasing scrutiny. Dambisa Moyo and Jeffery Sachs exemplify the two sides in this debate. Sachs (2005, 2008) asserts that the international community can easily address most of the problems plaguing the developing world, including maternal mortality and the spread of infectious disease, by marginally increasing foreign aid budgets. Investing in the developing world through increased foreign aid grants (not loans) will allow those countries to prosper, which will in turn benefit the entire world. The problem, as Sachs argues, is that developed countries remain too stingy with their foreign aid. Few countries, he notes, have achieved the goal of spending 0.7% of gross national income on official overseas development assistance—a goal agreed to by the United Nations in 1970 with Resolution 2626 and which was supposed to be achieved by 1975. Moyo (2009) counters that foreign aid does more harm than good, especially in African states. Foreign aid, she argues, contributes to corruption among public officials, encourages dependency relationships between developed and developing states, and discourages African governments from funding social services on their own. This leads governments to be unresponsive to the needs of their citizens and unaccountable to them. She instead advocates phasing out all government-to-government aid over 5–10 years. All three of the above debates address questions about the role of AIDS in the international community, the appropriate approaches for addressing it, and the role of foreign aid in general. A relationship between aid and HIV prevalence rates could suggest that donor states are more focused on humanitarian concerns rather than their private security needs. Higher levels of aid to states with higher prevalence rates may also suggest that states favour Sachs’ approach to aid. At the same time, the relationship between HIV prevalence, government spending on health and foreign aid for HIV may tell us something about the relative prioritization of health issues among donor states.

Measurement and methodology Disentangling the reasons why a state gives another government aid is an inherently complicated process. The nature of the policy process in a democratic political system makes it nearly impossible to identify strict causal relationships. Political alliances, partisan grandstanding, need, history and moral

FOREIGN AID, HIV AND HEALTH SPENDING

beliefs may all play a role for different actors at different times (Breuning 2007). That said, we can seek to find suggestive relationships by looking for correlations between different factors. Correlation is obviously not causation, but it may suggest relationships worthy of further investigation. It demonstrates the strength and direction of a linear relationship between two distinct variables. Lewis-Beck notes that correlation ‘remains the ideal bivariate measure for quantitative variables’ (1995: 22). In this case, we want to understand the correlations among variables measuring adult HIV prevalence rates, aid from donor states and government health care spending by recipient states. The strength and direction of these relationships can provide us with insights into who gets overseas development aid for HIV/AIDS treatment and why. We can start to understand whether variations in such aid are a matter of need. To test this relationship, I focus my attention on the 15 focus countries identified by the PEPFAR between 2004 and 2008. PEPFAR, in its original iteration, authorized the US Congress to spend up to US$15 billion over 5 years with hopes of preventing 7 million new infections, treating 2 million people with AIDS-related illnesses and providing care for 10 million persons affected by AIDS. This outlay was, at the time it was authorized, the largest expenditure ever made by a single state for global health. The 15 focus countries—Botswana, Cote d’Ivoire, Ethiopia, Guyana, Haiti, Kenya, Mozambique, Namibia, Nigeria, Rwanda, South Africa, Tanzania, Uganda, Vietnam and Zambia—had adult HIV prevalence rates ranging between 0.5 and 23.9% in 2007 (Table 1). When PEPFAR was announced in 2003, their adult HIV prevalence rates ranged between 0.4 and 37.3%.1 While they are not the most afflicted states, they do receive 60% of bilateral assistance authorized by PEPFAR. They serve as potential models for other

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countries and receive greater financial assistance, though 123 countries in total receive funds through PEPFAR-related programmes. I collected data on seven different variables related to the 15 PEPFAR focus countries to test the relationships between HIV prevalence, foreign aid and domestic health spending. Adult HIV prevalence is the midpoint of the estimated percentage of the population between ages 15 and 49 in 2003 as measured by UNAIDS, while adult HIV cases is the midpoint of the estimated number of HIV-positive persons in that same age cohort in 2003. While these numbers may have undergone adjustment with the introduction of new estimation methodologies in 2008, they are the numbers that policymakers had available to them at the time. PEPFAR funds average is the average annual outlay the country received from PEPFAR-related programmes between 2003 and 2008. Since the amount changed every year (increasing from year to year in nearly every case), I summed the amount received over PEPFAR’s 5-year initial authorization and divided that amount by 5 to get the average amount. The spending data are available from the country reports on PEPFAR’s website. PEPFAR per HIV case is the amount of average PEPFAR-related funds received by a country per HIV-positive adult, while PEPFAR per capita divides the average PEPFAR-related funds by the total population. Government health per capita is the per capita government health care expenditure in 2003 at the average US dollar exchange rate as collected by the World Health Organization’s Statistical Information System. I use the 2003 figures because, as with the HIV prevalence data, these are the data points with which policymakers implementing PEPFAR had to work at the time. Finally, PEPFAR/health presents the ratio of the per capita average PEPFAR-related funds for the entire population received from the US government to the state government’s average health care expenditure.

Table 1 PEPFAR focus countries

Country

Adult HIV prevalence (2003)

Botswana

Adult HIV cases (2003)

PEPFAR funds average (US$ millions)

PEPFAR per HIV case (US$)

PEPFAR per capita (US$)

Gov’t health per capita (US$)

PEPFAR/ health

37.3

330 000

60.08

182.06

34.04

308.00

0.111

Cote d’Ivoire

7.0

530 000

64.04

122.53

3.53

8.00

0.441

Ethiopia

4.4

1 400 000

170.20

121.57

2.20

3.67

0.599

Guyana

2.5

11 000

21.06

1914.55

28.04

51.33

0.536

Haiti

5.6

260 000

64.14

246.69

7.52

18.33

0.410

Kenya

6.7

1 100 000

269.32

244.84

7.86

11.33

0.694

Mozambique

12.2

1 200 000

116.54

97.12

5.89

9.67

0.609

Namibia

21.3

200 000

64.88

324.40

31.94

118.67

0.269

Nigeria

5.4

3 300 000

219.44

66.50

1.69

8.33

0.203

Rwanda

5.1

230 000

78.92

343.13

8.73

13.67

0.639

21.5

5 100 000

289.54

56.77

6.10

176.33

0.035

Tanzania

8.8

1 500 000

165.68

110.45

4.32

8.67

0.498

Uganda

4.1

450 000

185.86

413.02

6.45

6.33

1.019

Vietnam

0.4

200 000

46.74

233.07

0.55

11.00

0.050

Zambia

16.5

830 000

169.18

203.83

14.50

19.33

0.750

South Africa

Sources: UNAIDS (2004), PEPFAR (2009), WHO (2009).

– r ¼ 0.599* (0.018) r ¼ 0.217 (0.437) r ¼ 0.094 (0.738) *Significance at the 0.05 level (two-tailed). **Significance at the 0.01 level (two-tailed). First number is Pearson’s r; number in parentheses is significance level.

r ¼ 0.117 (0.678) r ¼ 0.412 (0.127) PEPFAR/health

r ¼ 0.357 (0.191)

r ¼ 0.599* (0.018)

r ¼ 0.217 (0.437) r ¼ 0.748** (0.001)

– r ¼ 0.748** (0.001)

– r ¼ 0.474 (0.072)

r ¼ 0.021 (0.942) r ¼ 0.115 (0.682)

r ¼ 0.441 (0.099)

r ¼ 0.894** (0.000) Gov’t health per capita

r ¼ 0.130 (0.644)

r ¼ 0.640* (0.010) PEPFAR per capita

r ¼ 0.372 (0.172)

r ¼ 0.094 (0.738) r ¼ 0.021 (0.942) r ¼ 0.477 (0.072) – r ¼ 0.422 (0.117) r ¼ 0.256 (0.357) PEPFAR per HIV case

r ¼ 0.363 (0.183)

r ¼ 0.357 (0.191)

PEPFAR/health

r ¼ 0.117 (0.678) r ¼ 0.115 (0.682)

r ¼ 0.130 (0.644) r ¼ 0.372 (0.172)

r ¼ 0.441 (0.099) r ¼ 0.422 (0.117)

r ¼ 0.363 (0.183) r ¼ 0.769** (0.001)

– r ¼ 0.769** (0.001)

– r ¼ 0.164 (0.558)

r ¼ 0.024 (0.933)

Adult HIV cases (2003)

PEPFAR funds average

r ¼ 0.894** (0.000) r ¼ 0.640* (0.010) r ¼ 0.256 (0.357) r ¼ 0.024 (0.933) r ¼ 0.164 (0.558) –

Gov’t health per capita PEPFAR per capita PEPFAR per HIV case PEPFAR funds average Adult HIV cases (2003) Table 2 Results of correlation tests, n ¼ 15

A cursory examination of the data gives reason to suspect that the relationships between HIV, foreign aid and domestic health spending may not be straightforward or based solely on need. Botswana and South Africa, the two countries with the highest adult prevalence rates, are among the top four in terms of PEPFAR funds per HIV-positive adult. Curiously, though, so are Uganda and Ethiopia, even though they rank 8th and 14th in adult HIV prevalence among the group of 15. Uganda receives more money from PEPFAR to confront AIDS on a per capita basis than its government spends on generalized health care itself, while South Africa and Vietnam both spend far more on generalized health care per capita than they receive for AIDS. Quick glances, of course, are no substitute for empirical analysis. To evaluate the relationships among the seven variables and 15 cases, I ran tests for two-tailed Pearson’s r, looking for significance at the 0.01 and 0.05 levels (Table 2). Of the 21 unique correlations, five achieve statistical significance. At the 0.05 level, adult HIV prevalence and PEPFAR per capita are positively correlated, while government health per capita and PEPFAR/health are negatively correlated. Looking at the stricter 0.01 level, the three significant correlations, all positive, are PEPFAR per capita and government health per capita; adult HIV prevalence and government health per capita; and adult HIV cases and PEPFAR average. More adult HIV cases, and not the adult prevalence rate, are related to a higher average level of PEPFAR funding from the US government. Higher adult HIV prevalence rates lead to higher levels of average per capita PEPFAR funds and higher per capita spending on health services by governments. Higher levels of foreign assistance for AIDS, as represented by per capita PEPFAR funds, are also related to higher domestic government spending on health care. Furthermore, those higher levels of domestic government health spending are related to lower per capita PEPFAR/domestic health spending ratios. These relationships suggest, though do not prove, a few important findings. First, they suggest that need may in fact play a role when donor states are allocating their AIDS-related funds. It is not the only factor, and may not even be the most important, but it does appear to matter to some degree. This may split the difference between those who argue for a security-based approach to global health and those who believe spending on health-related issues should be based more on humanitarian concerns. However, measurement of need may be based more on the total number of cases as opposed to the proportion of the population infected. Second, there may exist an additive relationship between foreign and domestic health spending. Aid for HIV and domestic health spending rise together. It may be the case that foreign funding for AIDS programmes frees up domestic money for other health issues. On the one hand, this could be a positive outcome, as it would suggest an overall rise in all areas of health services. On the other hand, it may raise questions about the long-term sustainability of this arrangement. If the focus countries have essentially

Adult HIV prevalence (2003)

Results and discussion

r ¼ 0.412 (0.127)

HEALTH POLICY AND PLANNING

Adult HIV prevalence (2003)

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outsourced support for AIDS programming to foreign donors, they may be vulnerable if donor states decide to reduce (or even simply fail to increase) their support. This may also suggest a division of labour when it comes to funding global health rather than the creation of a hierarchy. Mozambique relies on foreign assistance to fund 98% of its AIDS programming, while Uganda receives support for 95% of its AIDS programmes from outside donors (Oomman et al. 2007: 8–10). Third, governments may have been spurred on to provide more health services because of the AIDS pandemic. Increased per capita health spending may be the result, in part, of the need to provide auxiliary and complementary services to HIV-positive persons. The increased need for health services among HIV-positive persons may have spurred greater access to health services across the board in these countries. African states declared in 2001 that, by signing the Abuja Declaration, they would spend 15% of their own resources on health care services, though only Zambia and Namibia had made significant progress towards this goal by 2008 (Schneider and Garrett 2009: 8).

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Endnote 1

With the release of its 2008 report, UNAIDS changed its methodology for estimating adult HIV prevalence rates. As a result, the 2003 and 2007 rates are not directly comparable.

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Conclusion Correlation analysis cannot make definitive conclusions about the relationships described above. It can be useful, though, as a starting point for future research. Far too little empirical research has examined the relationships between foreign aid, domestic spending and global health. This is particularly surprising given the increasing attention paid to global health within the international community. This research note examines one element of the relationship between aid and HIV, looking at one donor country funding one programme. While we cannot draw definitive conclusions about the relationships between AIDS, foreign assistance and domestic health spending, we can start to disentangle relationships and plot important avenues for further study. Future research into this topic should collect data on foreign aid for HIV from additional countries to provide a comparative measure. It should also seek ways to determine whether causal relationships exist among these different variables. The current global economic crisis also raises important issues about the sustainability of future global health outlays. PEPFAR emerged from relatively flush economic times, and it remains uncertain what effects the economic downturn will have on the ability of donor states to contribute to HIV/AIDS programmes or global health in general. This research note provides a first cut at disentangling the relationship between foreign aid, domestic health spending and HIV prevalence. It suggests that donor countries do factor need into their decisions and that foreign aid may not necessarily crowd out domestic health spending. These findings help clarify the relationships, but also point to the need for collecting and analysing more data to really understand the depths of these relationships.

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