Important note: Information in this article was accurate in 2004. The state of the art may have changed since the publication date.
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Wall Street Journal - November 19, 2004
Marilyn Chase,marilyn.chase@wsj.com
The Global Fund wanted to launch its 2005 grant cycle this month, but faced U.S. lobbying of its board, donors and recipients to improve finances and management before proceeding. The vote to delay grants was taken at the fund's board meeting in Arusha, Tanzania, yesterday.
Officials at the U.S. Department of Health and Human Services had favored a six- to 12-month delay in new grants until the Global Fund could obtain more cash and tighten oversight of grant programs.
The fund's 19-member board voted unanimously to approve a compromise five-month delay. The decision was applauded by HHS Secretary Tommy Thompson, who also serves as fund chairman, as "affirming the Fund's need to proceed with responsibility and fiscal prudence."
The United Nations-backed fund was created in 2002 to fill the gap between needs and resources to battle the world's top three deadly infectious diseases. AIDS kills about three million people a year, tuberculosis two million and malaria between one million and 2.7 million.
Supported by pledges largely from wealthy countries and foundations, the fund has approved 300 multiyear grants in 128 countries valued at a total of $8 billion, and committed $3 billion of it so far.
But donations have lagged, leaving the fund short of its needs. After other donors were slow to make payments, the U.S., which is the fund's biggest backer, withheld $120 million of its $550 million pledge for 2004, citing a law limiting the U.S. to funding no more than one-third of the fund's budget. Besides its aid to the Geneva-based multinational group, the U.S. funds the President's Emergency Program for AIDS Relief, or Pepfar, in 15 countries.
The Global Fund's executive director, Richard Feachem, said the five-month delay in grant disbursement is a commitment to raise money and improve effectiveness. Approving new grants in 2005 will boost funding needs to $2.4 billion next year. The fund estimates 2005 revenue at $1.6 billion.
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