The Australian government on Thursday announced that it will write off Indonesian commercial debt worth 75 million Australian dollars, or $58.7 million, under the Global Fund to Fight AIDS, Tuberculosis and Malaria’s Debt2Health, AFP/Google.com reports. Debt2Health aims to promote public health and is similar to “debt-for-nature swaps,” which allow wealthy nations to forgive developing countries’ debt in exchange for “commitments that money which is freed up will be spent on environmental protection,” according to AFP/Google.com (AFP/Google.com, 5/28).

Indonesia will pay half of the debt amount to the Global Fund, which will channel the money to programs it supports in Indonesia, Robert Filipp, the Global Fund’s head of innovative financing, said. He added that Global Fund oversight promotes accountability and transparency (PressTV, 5/28).

Australian Parliamentary Secretary for International Development Assistance Bob McMullan announced the initiative in Paris, where he was attending the third meeting of the High Level Taskforce on Innovative International Financing for Health Systems. Debt2Health is one of the “key mechanisms” that the Taskforce is considering as part of an expansive range of financing projects aimed at reducing the effects of the global economic recession and promoting progress related to U.N. Millennium Development Goal targets in developing countries, according to a release (Global Fund release, 5/28).

“In order to reach and sustain the level of funding we need to succeed in the fight against the most deadly epidemics of our time, we must make use of innovative financing instruments,” Michel Kazatchkine, executive director of the Global Fund, said. As one of Australia’s “closest neighbours” McMullan said that it is a “priority for us to support the efforts of Indonesian authorities to fight TB” (AFP/Google.com, 5/28).   

Australia is the second country to join Debt2Health, but it is the first country to cancel commercial debt under the program (Global Fund release, 5/28). Germany was the first to join Debt2Health, and it has already made deals with Indonesia and Pakistan worth $69 million and $55.2 million respectively, AFP/Google.com reports (AFP/Google.com, 5/28).