GLOBAL FUND OBSERVER (GFO)
NEWSLETTER, a service of Aidspan.
Issue 24 - Friday 21 May 2004. (For formatted web, Word and PDF versions of
this and other issues, see www.aidspan.org/gfo/archives/newsletter
)
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In a surprising development, only one third of eligible Round 4
proposals, by dollar value, have been recommended by the Global Fund's
Technical Review Panel (TRP) for approval.
One result is that it is likely that the Fund will, after all, have
enough money to pay for all the Round 4 proposals recommended by the TRP for
approval. In a related move, the Fund
has reduced its estimates for the cost of renewing Round 1, 2 and 3 grants this
year and next.
2. ANALYSIS: Recommended Country-by-Country
Donations to the Global Fund
Aidspan
has issued an updated an Equitable Contributions analysis that addresses the
following broad questions: (a) How much money is needed by the Global Fund? (b) Which countries should contribute to
this need? (c) What minimum percentage
of the Fund's total need should each of these countries provide? (d) What is the current shortfall in
donations from each country?
(e) What should be done to enhance the chances that countries will
donate as per the Equitable Contributions Framework? The Global Fund board and secretariat have
thus far only been willing to tackle the first of these five questions.
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Only one third of
eligible Round 4 proposals, by dollar value, have been recommended by the
Global Fund's Technical Review Panel (TRP) for approval. This low proportion, which will surprise
many, is the same as applied in Round 3, and is less than the proportions that
applied in Rounds 1 and 2.
The TRP completed its review of 175 eligible Round 4 proposals a week ago. It will not be known until the board makes its approval decisions on June 28-30 which specific proposals the TRP has recommended for board approval, but it was learned today that the cost for Years 1-2 of the proposals it recommended for board approval is $951 m. This represents only 34% of the $2,800 m. cost of all the eligible proposals.
As reported in the last issue of
GFO, it was expected that in Round 4 the percentage approved would
be higher than in previous rounds because some previously unsuccessful
proposals had been resubmitted after being reworked, some large new proposals had
been submitted based on earlier successes, and WHO assisted many applicants
with the preparation of large HIV-treatment proposals.
The fact that TRP recommendation
rates are not going up, and that nearly half the submitted proposals were not
even passed to the TRP by the Secretariat because they were ineligible (e.g.
they were submitted by ineligible countries or organizations, or they covered
ineligible forms of activity) raises important questions about the application
process. These questions include: Did
the TRP take into consideration (in a way that it should not have) the limited
amount of money available to cover Round 4 grants? Are the TRP's
expectations regarding proposal standards going up, and if so why? Or are applications failing to improve in
quality despite the increased understanding that applicants have of the Global
Fund? Is the application form
sufficiently clear and sufficiently easy to complete? Is sufficient technical assistance available? Are applications being completed by a small
subset of those who should be involved, without others being aware until the
last moment what the application says, by which point it is too late to propose
improvements?
The one positive
consequence of this development is that it is likely that the Fund will, after
all, have enough money to pay for all the Round 4 proposals recommended by the
TRP for approval. (The Fund estimated
some time ago that it would have about $900 m. to pay for Years 1-2 of approved
Round 4 grants, and the amount available may increase if new donations come
in.)
The table below
shows approval rates for Rounds 1 through 4.
Proposals
Submitted to the Global Fund in Rounds 1 to 4
|
|
Number of
eligible proposals |
Percent |
Cost of
Years 1-2 |
Percent |
|
Round 1:
Submitted |
204 |
|
c. $1,500
m. |
|
|
of which,
Approved |
58 |
28% |
$578 m. |
c. 39% |
|
Round 2:
Submitted |
229 |
|
$2,137 m. |
|
|
of
which, Approved |
98 |
43% |
$878 m. |
41% |
|
Round 3:
Submitted |
180 |
|
$1,853 m. |
|
|
of
which, Approved |
71 |
39% |
$623 m. |
34% |
|
Round 4:
Submitted |
c. 175 |
|
c. $2,800
m. |
|
|
of which,
recommended for approval |
Not known |
Not known |
$951 m. |
c. 34% |
In a related development, the Fund has
reduced its forecast of the cost of renewing grants from Rounds 1, 2 and 3 this
year and next. In January, the Fund
forecast that costs of grant renewals would be as follows:
But now, the Fund is forecasting as
follows:
This could mean that grants are
progressing slower than anticipated; or it could mean that the cost for some
grants of Years 3-5 will be less than originally anticipated; or it could mean
that some grants are expected to be cancelled before the completion (or even
the start) of Years 1-2.
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[Note: The following report was published today by Aidspan, the NGO that produces GFO. The version as reprinted here does not include the detailed tables of data that are contained in two appendices. Footnotes, in square brackets, have been moved to the end. The 7-page full version of the paper is available at www.aidspan.org/gfo/docs/gfo61.pdf The spreadsheet containing all the data upon which the paper is based is available at www.aidspan.org/gfo/docs/gfo60.xls ]
Title: An Updated
Analysis of the Equitable Contributions Framework regarding the Global Fund [1]
Aidspan - 21 May
2004
1. Introduction
The Global
Fund to Fight AIDS, TB and Malaria, controlled by governments and civil society, was established in 2002
to raise money to tackle AIDS (described by many as the world's greatest
current challenge) plus TB and malaria.
In April 2002, a
paper entitled "The Global Fund: Which
Countries Owe How Much?" proposed that
contributions to the Fund should be made according to an "Equitable
Contributions Framework," in which donor countries contribute in relation
to the sizes of their economies. [2]
The "Equitable
Contributions" concept has since been widely promoted by non-governmental
organizations. In addition, President Chirac of France implicitly adopted
the concept by proposing that the Fund's needs should be provided one third by
the USA, one third by Europe, and one third by others. And the US Congress passed legislation that
the US contribution to the Global Fund shall be (no more than) one third of the
total given to the Fund.
This
paper seeks to update the Equitable Contributions analysis. It addresses the following broad questions:
(a) How much money is needed by the Global Fund? (b) Which
countries should contribute to this need?
(c) What minimum percentage of the Fund's total need should each of
these countries provide? (d) What is the
current shortfall in donations from each country? (e) What should be done to enhance the
chances that countries will donate as per the Equitable Contributions Framework? The Global Fund board and secretariat have
thus far only been willing to tackle the first of these five questions.
2. Assumptions
The analysis
below is based on the following assumptions:
(a)
As
stated by the Global Fund, the Fund needs to receive at least $1.4 billion
during 2004 and $3.3 billion during 2005. [3] (The increase between 2004 and 2005 is
because in 2005 many grants approved in the first three rounds will become eligible
for renewal, and because in 2005, unlike in 2004, there will be two new rounds
if the Fund continues its past practice of launching a new round every eight
months.)
(b)
As
proposed by President Chirac of France, and others: [4] The Global Fund's needs should be provided
one third by the USA (which has 32.2% of world GNP); one third by European
Union (EU) [5] countries (which have 26.7% of world GNP); and one third by
"Other" countries (which have 41.1% of world GNP). It is generally accepted that contributions
by civil society (foundations, corporations, and individuals) should be added
to the "Other" category.
(c)
As
proposed on many occasions by non-governmental organizations: Within each of these one-thirds,
"equitable contributions" should be made to the Global Fund by each
of the world's relatively affluent nations, who should contribute in proportion
to their GNP. [6] (Additional contributions are welcome from other countries,
and, as just stated, from civil society.)
In this paper, we propose that the equitable contributions should come
from the 41 countries that are defined by the World Bank as "high-income." [7]
[8] [9]
3. Key findings
The Appendices
[10] show how much has been pledged to the Global Fund thus far, and compare
this with how much should be pledged by various countries according to the
Equitable Contributions Framework analysis.
They show that:
(a) Total money promised thus far to the Global Fund for 2004 is $1,515 m., which is slightly in excess of the $1,400 m. needed. The promises have come 53% from EU nations (which have 27% of the world's GNP), 36% from the USA (which has 32% of the world's GNP), and 11% from "Other" (which have 41% of the world's GNP - though half of this GNP share is attributable to over 100 non-high income countries).
(b) Total money promised thus far for 2005 is $842 m., which is only 26% of the $3,300 m. needed. This has come 69% from EU nations, 24% from the USA, and 8% from "Other."
(c) Total money actually paid to the Global Fund since it was founded is $2,477 m. This has come 55% from EU nations, 25% from the USA, and 20% from "Other."
(d) The portion of its Equitable Contribution that each of the 41 high-income countries has pledged for 2004 and for 2005 is as in the following table. Countries represented on the board [11] are shown with asterisks. As can be seen, many countries have already pledged more than their Equitable Contribution for 2004. (This helps offset the low performance by "Other".) But 21 of the 41 high-income countries have not yet made any pledge for either year. High-income countries that are represented on the board but are still significantly below their Equitable Contributions for 2004 are Austria, Canada, Japan and Switzerland.
Portion of its Equitable Contribution that each of
the 41 high-income countries has pledged for 2004 and 2005
|
|
2004 |
2005 |
|
2004 |
2005 |
|
2004 |
2005 |
|
2004 |
2005 |
|
Andorra |
0% |
0% |
Denmark
* |
>100% |
0% |
Kuwait |
0% |
0% |
Singapore |
3% |
1% |
|
Antigua & Barbuda |
0% |