The Business of Health in Africa

Bhekinkosi Moyo

Bhekinkosi Moyo

It is day three here at the Brussels Square. Some people are beginning to go back home while others have just arrived for the EFC’s Annual General Assembly which started today. So many events happened today. First is the African Grant-Makers Network Steering Committee meeting on the forthcoming General Assembly meeting in November.  Second is the session that really spoke to my other love life-the area of economic governance or private sector development. Partly this is due to the work that I do at TrustAfrica. However most importantly this is also because these are areas that promise the revitalisation of societies in my continent. Thirdly is the opening plenary for the EFC AGA Conference which took the form of a conversation between foundations and the European parliamentarians. I could write about this session but let me say that there was an old Spanish parliamentarian-a man-who kept patronising his female colleague. At one moment he disagreed with her and said, ‘I disagree, I have been in parliament for more than 27 years and you will learn…’ Talk of age and gender in constructing power relations.

I want however to talk about the session on private investments in health in Africa. I write on this because I am of the view that for many decades, we have focused on important issues such as elections, human rights, democratisation and governance without strongly linking them directly to questions of economic management as well as private sector development. I am not suggesting that we have not focused on these issues-we have, but the attention or priority has not been given an equal force. Not surprisingly therefore I found myself once again in a session organised by the International Finance Corporation on improving health outcomes in Africa.

There were three presentations-all describing a partnership that was developed between IFC, the World Bank, the Gates Foundation and others in making program related investments in health. Readers would be interested in knowing that sub-Saharan Africa consists of about 11% of the world’s population and yet it carries about 24% of the world’s disease burden in human and financial costs. This is a huge challenge for a continent whose public resources are limited. It is in this context that the IFC’s Report called ‘The Business of Health in Africa: partnering with the private sector to improve people’s lives’ concludes that;

  • The private sector plays a dominant role in health in Africa. Already close to 60% of health financing comes from the private sector in Africa, and about 50% of total health expenditure goes to private providers. It is estimated that health expenditure will grow significantly in the next years due to increased economic growth rates and the population increase.
  • Both rich and poor rely on private health provision. This is despite governments’ public sector orientation.
  • There are opportunities for developing, engaging and supporting a well managed and effectively regulated private sector to improve health care provision.
  • Some messages emerged for me which I want to share.

First is the environment under which investments take place. Currently the legal, political and even cultural environment for investment generally is restrictive and more needs to be done to improve it. Hence the World Bank’s work on doing business indicators as well as such initiatives as the ‘the competitiveness report’ are important in understanding the terrain under which these health investments are made. Of particular importance for me especially in the field of health is to ensure that these investments are not just for purposes of getting huge returns but that they help move the needle in terms of developing inclusive investment opportunities not just for the middle income earners but for the marginalised.

Secondly, these investments must pay particular attention to societal needs in ways that bring into the fold those normally considered only as consumers. An inclusive investment approach should entail growing an inclusive market that would treat the poor as producers as well in the market. One of the presenters referred to an insurance scheme in Nigeria that has done well-perhaps ten-fold what it was when it started. Apparently, Mo Ibrahim has bought 60% of the stake. The presenter celebrated this as a model for others to follow and yet this raises several questions for me, one of which is; does an increase in investment returns necessarily mean an increase in numbers of people that now access primary health care? How many of Mo Ibrahims exist in these countries? So instead of one individual buying such large amounts of shares, would it not be ideal and proper that a community buys and owns this Fund?

The real question therefore for me is whether health investments in Africa are actually reaching the marginalised and those at the bottom of the pyramid-who are normally outside the ambit of the legal and policy framework. This is what the IFC and others promoting the private sector involvement and investments in health should answer.

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