Fiscal Space and Political Space for Financing the Global AIDS Response

This paper estimates the likely future resource availability for HIV and AIDS programs, using projections of population, GDP per capita, public revenues, and likely health spending in low-, middle-, and high-income countries.  Spending for HIV will be constrained by other priorities for public spending, whether by governments in recipient countries or by donor readiness to provide official or philanthropic assistance. Spending on health is constrained by the level of per capita income or product.

The analysis identifies two regions, Sub-Saharan Africa and South Asia, which are likely to continue to have too little money available for public purposes and specifically for HIV prevention, care, and treatment. Many countries in these regions, particularly those with generalized epidemics, will continue to require substantial donor assistance for HIV and AIDS over the next two decades. Middle-income countries in these and other regions show reasonable prospects of expanding their public sector and health budgets enough to sustain HIV programs with minimal donor aid.

Having enough money will not by itself be enough to assure that adequate programs and services are delivered in low- and middle-income countries. In far too many settings, especially in those countries with concentrated epidemics among most-at-risk populations that suffer from stigma and discrimination, there may be inadequate political space to permit governments to finance the most cost-effective and harm-reducing interventions. Unless attitudes toward helping these most-at-risk populations change, there will be a significant role for multilateral financial organizations to play in the fight against AIDS even in middle-income countries.

The high-income countries will not grow as fast as many middle-income countries over the years from now to 2031. To assure an adequate amount of donor support for HIV and AIDS, those countries will have to reach for the elusive target of spending 0.7 percent of their GDP on aid, and they will have to increase the share of that aid allocated to HIV and AIDS programs. The prospect of at least some middle-income countries sustaining their own programs and providing aid to their less fortunate neighboring low-income countries may help build an adequate funding base that seems so far not to have been attained.

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