• Inside Development

Citing Corruption Fears, Sweden Threatens Withholding Global Fund Contribution

By Ma. Rizza Leonzon24 January 2011

Gunilla Carlsson, Sweden's minister for international development cooperation, during the 2009 European Development Days in Stockholm, Sweden. Carlsson indicates that her country will withhold its contribution to the Global Fund to Fight AIDS, Tuberculosis and Malaria unless the fund improve measures that would protect funding from falling prey to corruption. Photo by: Gunnar Seijbold / Regeringskansliet

Sweden is reportedly planning to withhold some euro167 million (USD227 million) in contribution to the Global Fund to Fight AIDS, Tuberculosis and Malaria, unless measures to ensure that funding is not eaten up by corruption are scaled up.

The warning came amid reports that as much as two-thirds of grants provided by the fund end up in corrupt activities. 

“We are paying greater heed to the danger of corruption so before we commit ourselves to aid, we want to see practical measures put in place to combat this problem,” Swedish Minister for International Development Cooperation Gunilla Carlsson told Svenska Dagbladet, a Swedish daily.

Global Fund Executive Director Michel Kazatchkine said Sweden’s move to stall the delivery of its commitment is “not a good sign.”

“We need to know quickly whether we can pour our energies into our aid projects,” Kazatchkine added. “We also believe that we have demonstrated a much greater degree of transparency and that we are doing everything that we can to fight corruption.”

According to The Associated Press, much of the funding donated to the USD21.7 billion fund has been spent on transactions with forged documents or improper bookkeeping, indicating money was siphoned off. The news agency cites findings by investigators from the Global Fund inspector general’s office, which has so far examined a tiny portion of the USD10 billion spent by the fund since 2002.

In Mauritania, 67 percent of the AIDS funding was misspent, the investigators said. Some 36 percent of a Malian program meant to combat tuberculosis and malaria, as well as 30 percent of grants to Djibouti have also suffered a similar fate.

>> Bate: In Accountability, Global Fund Doesn’t Measure Up

The Global Fund is canceling financing to countries found to have misused funding and requiring aid-recipient nations to repay misspent funding.

“The messenger is being shot to some extent,” Global Fund spokesman Jon Liden said. “We would contend that we do not have any corruption problems that are significantly different in scale or nature to any other international financing institution.”

About the author

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Ma. Rizza Leonzon

As a staff writer, Rizza focuses mainly on business coverage, including key donors such as the Asian Development Bank and AusAID. She covers breaking business news particularly at the ADB and has conducted interviews with specialists from the Inter-American Development Bank, World Bank and other top players in international development. Rizza also contributes to the daily Development Newswire and other Devex publications.


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