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Global Fund Observer


Issue 223: 25 July 2013

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Editor’s Note: This is a special issue of Global Fund Observer. It is devoted almost entirely to a review of the reforms that the Global Fund has undertaken, and of the major challenges facing the Fund. In Article 1, Aidspan’s David Garmaise and Kate Macintyre provide an assessment of the reforms and discuss their impact. In Article 2, guest commentators from four organisations provide their perspectives on the major challenges.


1. ANALYSIS AND COMMENTARY: Global Fund Deserves Credit for Implementing Major Reforms, but Challenges Remain

The Global Fund of today is a tighter, more responsive and more activist organisation, thanks to the introduction of some major reforms, write David Garmaise and Kate Macintyre. Donor confidence has been restored. However, it is still too early to judge the full impact of the reforms.

2. COMMENTARY: Reflections on Challenges Facing the Global Fund

In this commentary, several observers of the Global Fund describe what they see as the main challenges facing the Fund. We provide reflections from Owen Ryan (amfAR); Victoria Fan and Amanda Glassman (Center for Global Development); Jorge Saavedra (AIDS Healthcare Foundation); and Jason Wright (International HIV/AIDS Alliance).

3. ANNOUNCEMENT: TRP Replenishment Is Underway

The Global Fund is searching for people to serve on its Technical Review Panel. The deadline for applications is 31 July 2013.

See section near the end of this newsletter listing additional articles available on GFO Live.

1. ANALYSIS AND COMMENTARY: Global Fund Deserves Credit for Implementing Major Reforms, but Challenges Remain

Donor confidence has been restored; some issues remain unresolved

By David Garmaise and Kate Macintyre

Two-and-a-half years have elapsed since the Associated Press story about fraudulent activities among a small number of recipients of Global Fund grants ignited headlines in the media and undermined the confidence of some donors, some of whom withheld their contributions to the Fund. The headlines exaggerated the extent of the fraud (see GFO commentary), but the uproar nevertheless underscored the need for the Fund to make some fundamental changes to the way it operates.

And it has. 

In this article, we discuss the major reforms and examine their impact. We focus on the following areas: the reorganisation of the Secretariat; the new funding model; governance; risk management; revenue forecasting and the replenishment; financial management systems; grant renewals; grant implementation; impact; and partnership. In the process, we touch on some “cross-cutting” themes, such as human rights; the inclusion of civil society and most-at-risk populations (MARPs); and communications. Finally, we discuss some unresolved issues.


In the period since the Associated Press story, the Global Fund established a panel of experts to assess where improvements were required (see GFO articles here, here and here) and implemented a series of reforms. While it is too early to assess the full impact of some of the reforms, it is clear that the Global Fund of today is a tighter, more responsive and more activist organisation. The confidence of donors appears to have been restored. Comments from people who observe the Fund have been generally positive.

Secretariat reorganisation

Soon after he took up his post as General Manager in February 2012, Gabriel Jaramillo undertook an extensive restructuring of the Secretariat. The idea of moving more resources into grant management – where three out of every four Secretariat employees now resides – was a sound one. Each of the 20 high-impact countries has a dedicated fund portfolio manager (FPM), supported by a country team. The country team consists of two full-time programme officers, a finance officer, a monitoring officer, a procurement officer and a legal officer. Country team members work together in the same unit.

As a result, the performance of the FPMs and the country teams has been enhanced. This is apparent externally – for example, in the participation of the FPMs and the country teams in the country dialogues; and internally – for example, in the input the FPM and the country teams have been providing into the deliberations of the Grant Approvals Committee (GAC) on funding recommendations.

The reorganisation process, which involved a number of dismissals and many transfers, appears to have been handled competently, though it is impossible to go through this kind of exercise without some people getting hurt – which is what happened in this case.

Several high-level positions were filled, including the Executive Director (Mark Dybul), the Inspector General (Martin O’Malley), the Director of Communications (Seth Faison), the Chief Procurement Officer (Christopher Game), the Chief Risk Officer (Cees Klumper) and the Treasurer (Sylvie Billion). The last three positions were newly created.

It is too early to assess the full impact of the reorganisation. Some challenges remain. Mr Jaramillo has identified two of them: (1) insufficient resources may have been allocated to grant management in the non-high-impact countries; and (2) considerable work is required to ensure that promotions in the Secretariat are based on merit, and that this is seen to be the case by employees. In addition, many civil society organisations remain concerned about the decision to disband the civil society team in the Secretariat.

The transition in the top job from Mr Jaramillo to Mr Dybul appears to have gone very smoothly. 

New funding model

The new funding model (NFM) is the most ambitious of the reforms. To some extent, it remains a “work in progress,” but there have already been notable achievements.

Applications process

The centrepiece of the NFM is the new, iterative approach to the applications process. This includes the country dialogue, where all stakeholders have an opportunity to feed into the development of the proposal (concept note); and the concept note development process itself, which involves a lot of back and forth between (a) the country and (b) the Secretariat and the Technical Review Panel. The country dialogue and the concept note development processes are intertwined.

It is already apparent from the experience of the three countries that have gone through these processes that they are a significant improvement over the process used for the rounds-based system (see GFO articles here and here). Civil society organisations are much more involved in the applications process than before; and representatives of MARPs are also involved, sometimes for the first time. In some instances, the Secretariat pushed hard for this to happen. It is also apparent that the Secretariat actively promoted the inclusion of human rights interventions and activities targeting MARPs in the concept notes. (These are themes that the Global Fund has also been promoting at a corporate level.)

Under the rounds-based system, less than 50% of proposals were approved. Under the new iterative system, the failure rate should be reduced to zero, or close to zero. This is a major accomplishment.

During the transition phase, the country dialogue and the concept note development processes are happening in different ways in different countries. This will probably remain true even after the NFM is fully rolled-out. It is necessary to have this flexibility. However, the Global Fund will need to establish some minimum standards, and will need to define the roles and responsibilities of the various stakeholders in the process.

It is too early to assess the full impact of the new applications process. Perhaps by late-2014, by which time a group of standard applicants will have gone through the process, a full analysis will be possible.

Allocations methodology

The methodology for allocating available funds to individual countries (and other applicants) is very complicated; much work remains to be done before the full rollout (see GFO articles here and here). It was much simpler under the rounds-based system because there really wasn’t any allocations process; the Global Fund simply invited applications and basically said: “We think we have enough money to fund all technically sound proposals.”

With demand clearly outstripping supply, and with the new applications process expected to produce a near-zero failure rate, obviously a new allocation methodology was required. The Global Fund says that the methodology is bound to be complicated to ensure that it is fair; that it keeps the portfolio global; that the Fund gets the impact it believes it needs; and that applicants are encouraged to provide a “full expression” of their needs.

Perhaps that is true. But as long as the methodology remains very complicated, and difficult for people to understand, applicants may not see it as “fair,” and may perceive that criteria are being applied and decisions are being made in the dark.

Aidspan is concerned that with only about six months to go to the full rollout of the NFM, there is still no clarity on some very big items, such as how the incentive funding stream will work, how countries will be allocated to bands, and how unfunded quality demand will be handled.

It is much too early to assess the impact of the new allocations methodology. By mid-2014, we may be able to do so.


The Global Fund has not done a very good job of communicating information on the new funding model. Aidspan has heard over and over again from people in the field that they are not being kept informed. (See GFO commentary.)  When we approached the Secretariat about this, it said that it had been focusing on consultations with its partners, including representatives of civil society organisations. Consultations are not a substitute for a good communications plan.

Governance reform

Even before the High-Level Panel issued its report in 2011, the Global Fund Board started a process of governance reform. But it still hasn’t finished it.

The first phase of the reform involved changes to the structure and roles of the Board and its committees. The idea behind the changes was that the Board and its committees should concentrate on big-picture issues and should avoid micro-managing the work of the Secretariat. Some decision-making authority was devolved from the Board to its committees, and some was devolved to the Secretariat.

The Board is spending less time micro-managing; decisions at Board meetings have slowed to a trickle. And at the last Board meeting in Sri Lanka in June, Board members did indeed spend some time discussing big-picture issues (without taking any decisions related to these issues).  

Meanwhile, the Board committees are making a lot more decisions these days on matters that do not need to be referred back to the Board. There seems to be more action at the committee meetings than at the Board meetings. The Strategy, Investment and Impact Committee has been consumed with the task of working out the details of the allocation methodology for the NFM for well over a year.

Recently, Mr Jaramillo was critical of the way the Board and its committees operate, especially the committees. He said that the committees should not try to define every parameter of the Secretariat’s operations. Rather, he said, they should be talking about how to win the war against HIV, TB and malaria “faster and cheaper.” Mr Jaramillo added that committee meetings that lasted several days are not meetings, they are conferences.

Not all Board constituencies are represented on each committee. This was done on purpose, on the basis that (a) the deliberations of the committees feed into discussions by the full Board; and (b) if every Board constituency were represented, the committees would be just like Board committees-of-the-whole. However, given that the committees are now making decisions on their own authority, this rationale no longer makes sense. Committee decisions are being made without representation from all constituencies.

Obviously, more thought needs to be given to the structure and operations of Board committees.

When he was Board Chair, Simon Bland tried to implement a second phase of governance reform, but he had trouble whipping up the necessary enthusiasm from other Board members, particularly with all that was happening around the NFM. The second phase was supposed to enhance the engagement of implementing countries in discussions and decisions of the Board and its committees. It was supposed to address problems such as the large number of countries represented in each implementing country Board delegation; high turnover of Board members and alternates, which has implications for levels of knowledge retained by the delegations; and processes to select Board members and alternates that are often unclear and undocumented.

The best that can be said about the governance reforms is that they are a work in progress. There are indications that the new Board Chair and Vice-Chair want to take up two of the issues mentioned above: (1) implementing country engagement and (2) committee membership and roles.

Risk management

Risk management is one of the major areas of reform, which makes sense given that the uproar in 2011 was caused by allegations of fraud in the implementation of Global Fund grants. It is clear from the progress reports provided by the General Manager and the Executive Director that significant new measures were introduced to reduce risk, not only at the grant level but also at the corporate level.

Until recently, we were not provided with many details on the new measures. However, a report prepared by Chief Risk Officer Cees Klumper, posted on the Global Fund’s website in May, provided an overview of the Fund’s new approach to managing risk and described specific measures to reduce the risk of fraud (see GFO articles here and here).

In addition, the Global Fund has prepared a Risk Management Framework (which has not been made public). The Board plans to organise an evaluation of the implementation of the Framework every three years. Thus, it is too early to assess the full impact of the new risk management approach.

In April 2013, the Secretariat provided the Finance and Operational Performance Committee (FOPC) with an update on the implementation of the Risk Management Framework. Unfortunately, the document is labelled “for internal use only,” so Aidspan cannot report on it. We understand the need for documents to remain confidential until they are discussed by committees or the full Board. But, surely, three months after the FOPC meeting, the Secretariat could release the update publicly or at least issue a communiqué providing a summary of the update.

Revenue forecasting and replenishment

The Global Fund has improved its revenue forecasting, which was clearly weak in 2011 when Round 11 had to be cancelled after it had already been launched. The new forecasts are more thorough and more reliable. The Secretariat and the FOPC have contributed to this improvement.

For the Fourth Replenishment, now underway, the Global Fund has a more solid message and a more refined strategy compared to the Third Replenishment, which had disappointing results. Even between the mid-term replenishment meeting in November 2012 and the “pre-replenishment” meeting in April 2013, improvements were visible. At the April meeting, the Global Fund was more thoughtful, more punchy and more forceful.

The Global Fund has made a solid effort to estimate total demand. It released its estimate in a report prepared for the pre-replenishment meeting and did a good job of justifying the estimates at the meeting. Civil society organisations welcomed the report, even though they believe that some of the assumptions made by the Fund – particularly concerning increased levels of domestic financing – were overly optimistic.

Donors at the pre-replenishment meeting were impressed by how clearly the Global Fund – making the best use of its key technical partners, UNAIDS, the World Health Organization, Roll Back Malaria and STOP TB – explained the dynamics of the three diseases and the fact that we are at an “historic moment” in the fight against the diseases.

The Global Fund has done a good job of increasing its visibility in implementing countries, and demonstrating the impact of programmes supported by the Fund, through a series of news releases built around the signing of grant agreements and high-level visits to implementing countries.

Whether this will translate into the Fund reaching or coming close to its goal of $15 billion for the Fourth Replenishment remains to be seen. There are a lot of factors at play, most of them beyond the control of the Global Fund.

Financial systems

By its own admission, the Global Fund has not moved swiftly enough to correct the deficiencies in its financial management, accounting and reporting systems. Former General Manager Gabriel Jaramillo acknowledged this in his last report to the Board (see GFO article); and GFO recently reported on problems with individual grant data (see article). However, the Secretariat is in the process of implementing a comprehensive Finance Step-Up project, which will hopefully fix the problems.

Grant renewals

The Global Fund Secretariat has improved the process of reviewing requests for continued funding. The changes started under the old Grant Renewals Panel and continued under the new GAC. The inclusion of technical partners in a non-voting capacity on the GAC was a smart move. There is now more interaction among the committee, the Secretariat and the applicants, similar to what happens under the new iterative process for the NFM.

In addition, the Secretariat is now providing Board delegations with considerably more information than it did previously on the performance of each grant and on the GAC’s assessment of the request for continued funding. In the interests of transparency, we’d like to see the Global Fund post on its website the same information it provides to Board delegations (after the Board makes its decisions, of course).

Grant implementation

The Global Fund says that changes have been made to grant implementation processes, but the Fund has not provided a summary of the changes. One example we are aware of is the decision to move to a system of annual disbursement decisions for many grants.

The Global Fund has said that it needs to simplify grant implementation processes and requirements. However, by its own admission, it has not made significant progress on this front.


The Global Fund has developed a much stronger focus on achieving impact with its investments. It is looking beyond the output indicators it relied on so heavily in the past, and is developing stronger measures of coverage, outcomes and impact. The Fund is supporting, and participating in, national programme reviews. Impact profiles are being developed for each country applying through the NFM. Here, again, the reforms are ongoing.


A commitment to working with partners has been a key feature of the Global Fund from the outset. There were times in the past when the commitment was viewed as more theoretical than real. However, the Global Fund has now taken significant steps to consult partners and involve them more in the work of the Fund. For example, as mentioned above, technical partners are included on the GAC. Technical partners are also included on the three disease committees that were established as part of the reorganisation of the Secretariat.

During the early implementation of the new funding model, the Secretariat has undertaken extensive consultations with all partners, including civil society. Also, in the country dialogues that have taken place so far, technical partners, civil society organisations and representatives of key populations have played a big part.


Funding for middle-income countries

One of the reasons behind the push for a new funding model and, more specifically, for the use of an allocation formula was that many people believed (a) that under the rounds-based system, a growing percentage of funds was going to middle-income countries at the expense of low-income countries; and (b) that governments of middle-income countries should be shouldering a greater share of the burden.

This became a contentious issue, with some Board members and many civil society organisations arguing that people living with, and affected by, the diseases in middle-income countries would be neglected or, at least, disadvantaged. People have argued that in three regions in particular – Latin America and the Caribbean, Eastern Europe and Central Asia, and Middle East and North Africa – most-affected populations will lose out under the new system.

The Global Fund has said repeatedly that under the NFM, middle-income countries with epidemics concentrated in MARPS will still be able to apply for funding. But we don’t know what their share of the funding will be. So, almost two years after this debate began, we still don’t how this is going to play out.

Country ownership

“Country ownership” has been a core principle of the Global Fund since it started. But how the principle has been applied has evolved over the years, and may well evolve at a faster pace under the NFM. In 2011, the High-Level Panel recommended that the Global Fund Board adopt a new statement on “country ownership.” A project to do just that was included in the Consolidated Transformation Plan. But nothing has happened. (See GFO analysis).


The Global Fund has made the changes that were needed to restore donor confidence. In a replenishment year, this is obviously critically important. However, many reforms are still being implemented and will need to be watched closely. The next year or two promises to be just as exciting as the last few.

[This article was first posted on GFO Live on 25 July 2013.]

To comment on this article, click here.



2. COMMENTARY: Reflections on Challenges Facing the Global Fund

Editor’s Note: We invited several observers of the Global Fund to prepare a short commentary on what they see as the main challenges facing the Fund at this time. Here are contributions from Owen Ryan; Victoria Fan and Amanda Glassman; Jorge Saavedra; and Jason Wright.

Owen Ryan
Deputy Director, Public Policy, amfAR (Foundation for AIDS Research)

Two years ago, the greatest question facing the Global Fund was whether or not it would exist to see another decade. Thankfully, the hard work of many individuals has made such doubts seem hyperbolic. Instead, the issues of greatest relevance today focus on the game-changing new funding model (NFM).

Where should the Global Fund provide financing?

Economic development in many parts of the world has not led to similar gains against the three diseases in those same locations. As more of the world’s poor become concentrated in middle-income countries, the Global Fund must seriously evaluate if it’s “high-impact countries” approach is tackling the three diseases in the most efficient and effective way possible. Given expanding HIV, TB and malaria epidemics outside of sub-Saharan Africa, a strategy that focuses significantly on that region will miss much of the world’s disease burden and the world’s poor.

....and for what?

We know a good deal more about fighting the three diseases today than we did when Round 10 was awarded. At the time, few could have predicted the scientific and technological innovations that were on the horizon (e.g. treatment as prevention for HIV and GeneXpert for TB). Yet, many Global Fund grants continue to operate under antiquated understandings of these epidemics, often because they were proposed five or more years ago or because the process of reprogramming has only recently been embraced. To remain relevant, the NFM must be reliable enough to encourage long-term planning but flexible enough to adopt innovation as it arises.

…and to whom?

Success against the three diseases hinges on the Global Fund’s ability to build strong civil society partners who have the technical capacity to act as principal recipients. While current efforts have increased civil society’s consultative role, sustainability requires creating the next generation of civil society implementers by investing in effective capacity building today.  


Victoria Fan and Amanda Glassman
Global Health Policy, Center for Global Development

The Global Fund’s biggest challenge: Shifting from audits to results

In our report More Health for the Money, we outline an agenda for the Global Fund and its partners to obtain more health for the money invested. One critical area is the Global Fund’s performance-based financing and local fund agent system, which to date has been dominated by an emphasis on financial audits instead of results. Indeed, in the Fund’s manual for local fund agents, the organisations charged with verifying performance, the word “audit” appears 279 times and the word “risk” 376 times.

Not surprisingly, indicators are plentiful but there are few important coverage and outcomes measures. Worse, the Global Fund’s performance measurement is not robust: with 6-8 reserved consultant-days, the measurement doesn’t capture a representative sample of the population or health facilities. Finally, disbursements don’t match the amounts that would be expected given performance scores.

All this adds up to weak incentives for performance and value for money. The Global Fund can redesign its performance-based financing to create incentives for value for money by adopting three recommendations:

  1. Reduce the number of key performance indicators by excluding input and output indicators (e.g. such as number of bed nets distributed), and refocus measurement on key outcomes and coverage (e.g. percentage of households sleeping under a bed net). Recent use of “impact profiles” isn’t sufficient if performance measures are not linked to payment.
  2. Set aside a tranche of funding for which payments are directly connected to performance, without deference to discretionary or contextual factors.
  3. Use robust and representative methods to verify self-reported results.

We invite you to read our online consultation draft in full.


Jorge Saavedra
Global Ambassador, AIDS Healthcare Foundation

Increased demand for HIV treatment, opportunity for a higher impact

The new antiretroviral treatment (ART) guidelines from the World Health Organization, launched just two weeks ago, are institutionalising something what many doctors already knew and that was clearly demonstrated with the HPTN052 study published in 2011: ART, as happens with TB treatment, not only saves lives but significantly reduces the possibility of transmitting the virus to others, in fact by 96%. Moreover, for the HIV-positive individual’s health, it is better to start treatment earlier when they have 500 CD4 cells and not to wait until their immune system deteriorates to 350 CD4 or less.

Now, with the challenge of this new reality, what should the Global Fund do? Opportunity for reprogramming grants was part of the reforms approved by the Fund’s Board. Hence, I strongly believe that with the help of technical partners – and the involvement of countries, civil society organisations and communities – most of the projects running, including those selected under the new funding model, need to be reviewed and reprogrammed.

For example, in  Zimbabwe, when the new grant was planned, the baseline of treatment coverage was around 80%. However, under the new WHO guidelines, coverage will drop to 50% or less, which means that the proportion of people in need for treatment (but not receiving it) will increase from 20% to 50% or more.

This should not be seen as frightening, but rather as an opportunity to make better use of resources for a rapid and effective control of the HIV epidemic. The resources need to follow the logic of science on how to save more lives – and not follow preconceptions based on old, formerly attractive ideas, because not everything that sounded right is the right thing to do.


Jason Wright
US Director, International HIV/AIDS Alliance

I will not reiterate what I wrote in my blog posting for the Center for Global Development in late 2012, in which I discussed national ownership, balance and accountability.

As the US Director of the International HIV/AIDS Alliance, I would like to focus on the great challenge of civil society engagement. Civil society has played indispensable roles from the beginning in Board governance, grant implementation (as principal recipients and sub-recipients), and grant oversight (as members of country coordinating mechanisms [CCMs]). In the nomenclature of the HIV/AIDS Investment Framework, civil society engagement is crucial to target key populations and to address critical enablers.

The need for the Global Fund to reform was widely recognized, but the new funding model (NFM) presents both opportunities for increased civil society engagement and threats to hard-fought gains, including dual-track financing and the enforcement of the revised CCM guidelines.

Alliance linking organisations were fortunate to participate in the country dialogue and concept note development processes in two of the first three early applicant counties, El Salvador (Atlacatl) and Myanmar (Alliance Myanmar). In these countries, as well as in Zimbabwe, the Global Fund Secretariat – from Executive Director Mark Dybul* to the fund portfolio managers and the rest of the country teams – made a good-faith effort to engage civil society, including key populations.

There seems to be a broad and deep institutional commitment to civil society engagement, but the Alliance maintains its concerns about the disbanding of the civil society team and the downsizing of the CCM team to a hub under General Manager Gabriel Jaramillo. It will be extremely difficult to effectively roll out the NFM from the few early applicant countries to all recipient countries with so few staff with expertise and focus on civil society and CCMs.

The Alliance and other NGOs have committed themselves to supporting civil society engagement at the global and especially national levels, but we need the interlocutors to do so.

* For full disclosure, as the USAID Liaison to the Global Fund, I had the privilege of working with Mark when he was US Global AIDS Coordinator.

[This article was first posted on GFO Live on 24 July 2013.]

To comment on this article, click here.



3. ANNOUNCEMENT: TRP Replenishment Is Underway

The Global Fund has issued a formal call for applications from people interested in being part of the Technical Review Panel (TRP) for the period 2014­–2016.

The TRP consists of experts in HIV/AIDS, tuberculosis, malaria and health systems, community systems, and cross-cutting development issues. The primary function of the TRP is to review funding requests for technical merit and strategic focus, and make funding recommendations.

TRP members are paid an honorarium, for each day they work as well as travel expenses.

More information and applications forms are available on the Global Fund website here. The closing date for applications is 31 July 2013.

[This article was first posted on GFO Live on 17 July 2013.]

To comment on this article, click here.



The following articles have been posted on GFO Live on the Aidspan website. Click on an article heading to view the article. These articles may or may not be reproduced in GFO Newsletter.

ANNOUNCEMENT : Aidspan Seeks to Recruit M&E Officer / Research Officer

Aidspan is looking for a Monitoring and Evaluation Officer / Research Officer. The deadline for applications is 9 August 2013.

ANNOUNCEMENT : Aidspan Seeks Regional GFO Correspondents

Aidspan wants to recruit GFO correspondents for East Africa; West and Central Africa; Southern Africa; North Africa and the Middle East; and South Asia.

NEWS : LGBT Groups in Cameroon Forced to Suspend AIDS Education

Lesbian, gay, bisexual and transgender organisations in Cameroon have informed the Global Fund and other donors that they have decided to halt AIDS education programmes until security can be improved. The announcement follows the discovery of the murdered body of  activist and journalist Eric Lembembe.

NEWS : WHO Issues New HIV Treatment Guidelines

In a move that had been expected, the World Health Organization has issued new guidelines calling for antiretroviral treatment to be initiated when CD4 counts fall to 500 or less.


This is an issue of the GLOBAL FUND OBSERVER (GFO) Newsletter.

We welcome suggestions for topics we could cover in GFO. If you have a suggestion, please send it to the Editor of GFO (see contact information below).

Author: Article 1: David Garmaise (, GFO Editor; and Kate Macintyre (, Aidspan’s Executive Director. Article 3: David Garmaise.

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