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Donor Funding for Health in Low- & Middle-Income Countries, 2002-2013

As 2015 marks the end of the Millennium Development Goals (MDGs) and a transition to the new Sustainable Development Goals (SDGs), the global community is taking stock of progress made as well as the unmet needs looking forward. A key component in the effort to address global health challenges has been donor funding from governments and multilateral organizations. Indeed, while domestic funding has increased, and in some areas now constitutes a greater share of total available resources, donor funding will continue to play a significant role in achieving the SDGs.1 This analysis presents trends in donor funding for health in low- and middle-income countries between 2002 and 2013. Funding during the period increased more than five-fold, rising from $4.4 billion to $22.8 billion (see Figure 1), an increase even after adjusting for inflation and exchange rates. In 2013, donor funding for health increased by $2.7 billion compared to 2012, the largest percentage increase (13.5%) since the early part of the previous decade when increases were largely spurred on by the creation of several new funding initiatives and mechanisms such as The Global Fund to Fight AIDS, Tuberculosis and Malaria (Global Fund)2 and the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR).3 These increases occurred despite the financial uncertainty that resulted from the global economic crisis and its aftermath.

Donors have placed a priority on health, relative to some other sectors, with funding for health increasing as a share of total Official Development Assistance (ODA) for the third year in a row. The health sector saw the third largest increase, after multisectoral and economic infrastructure projects.  Additionally, 2013 marked the first year since 2003 where every health sub-sector (e.g. HIV, TB, Malaria, etc.) increased. HIV/AIDS accounted for the largest share of health assistance (35.3%), although it has declined from prior year levels. The next largest sub-sector was Basic Health & Infrastructure followed by Family Planning & Reproductive Health (FP/RH).

Fifty donors provided Health ODA in 2013 (32 bilateral donors and 18 multilateral donors), an increase from 26 donors (21 bilateral and 5 multilateral) in 2002. While the number of donors has increased over time, the majority of the increase between 2002 and 2013 is largely attributable to the original 26 donors (63%), of which the U.S. accounted for nearly half of the increase. Two new donor entrants accounted for nearly one third of the increase: the Global Fund (22%), which first disbursed funding in 2003, and GAVI (8%), which first disbursed funding in 2007.

Nearly two-thirds (64.5%) of Health ODA was provided bilaterally in 2013 with one-third (35.5%) provided by multilateral institutions. While the U.S. has consistently been the largest donor to health and provided the greatest share of its ODA for health, the donor mix has shifted over time. This is in part due to the entrance of new donors, particularly the Global Fund, and to a lesser extent, GAVI, which are now among the top five donors to global health. The U.S. and the Global Fund combined have accounted for more than half of total donor funding for health since 2010. Regionally, a growing share of funding over the period was directed to Sub-Saharan Africa. In addition, donors have provided an increasing share of Health ODA to Least Developed Countries (LDCs), rising from 27.0% in 2002 to 41.2% in 2013.

These trends are based on analysis of ODA disbursements for the health sector provided by bilateral and multilateral donors between 2002 and 2013, and are part of a multi-year effort of the Kaiser Family Foundation to analyze and track trends in donor funding for health.4,5,6