EDITOR’S NOTE: Similar to other countries, Rwanda needs to have a holistic health infrastructure, involving trained professionals, high-quality medical facilities and affordable access to services, says John Rwangombwa. The current Rwandan finance minister suggests that donors rethink their policy of earmarking aid for specific diseases such as HIV/AIDS.
Practitioners of both medicine and public finance share a first common principle: ‘Do no harm’. In the face of massive increases in public resources for health care in developing countries in recent years, many practitioners of both disciplines have begun to talk of the potential distortionary effects of donor earmarking and the so-called vertical funds that have now found their place in development cooperation at the country level. If some researchers and policymakers are to be believed, the massive influx of finance—much of it in the form of ODA—earmarked for specific diseases or interventions has the potential to undermine the sustainable development of the very country systems that need to be built up to respond to a population’s health care needs over the long term.
Rwanda is no exception to the phenomenon of donor earmarking. Figure 1 shows almost two-thirds of donor resources to the health sector in 2006 were earmarked for interventions related to specific diseases, with HIV/AIDS absorbing the greatest share of these resources. In 2006, approximately $200 million were allocated to the health sector (more than $20 per capita) corresponding to about 7.5 percent of GNP. Two-thirds of this accumulated budget was financed off budget by development partners, and more than half of it was earmarked for projects and programs on HIV/AIDS control. On the positive side, some of these funds are re-integrated into the overall health care system through cross-subsidy effects (e.g. the medical doctor hired through HIV/AIDS earmarked funds carrying out consultation and treatment for all kinds of patients coming to the hospital).
While HIV/AIDS prevention and treatment is an important cornerstone of Rwanda’s EDPRS, the eradication and treatment of life-threatening diseases in Rwanda—as in any country—depends on a more holistic health infrastructure, characterized by trained professionals, high-quality clinical facilities, and affordable access. Indeed, the Government of Rwanda has built successful partnerships with the providers of assistance to the sector, such as the Global Fund for Aids, Tuberculosis and Malaria, to ensure that their assistance is situated within the government’s plan to transform the Rwandan health sector as a whole, not limited only to single types of disease or treatment. For example, the upgrading of health centers and laboratories financed by donor resources, is approached in a manner that not only allows those facilities to cater better to the prevention and treatment of a subset of diseases, but provides higher-grade public health facilities for the use of the local population as a whole.
As policymakers, we need to be cautious about earmarked aid, but above all, we need to recognize the importance of dialogue between the beneficiaries of assistance and its providers. Where a population—and its government—is able to exert strong ownership of a country’s development agenda, donors should align their assistance to country systems and plans, and participate in common dialogue at the country level, focused on joint and shared development results.