1 - Overview of current situation

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With spectacular results, the first innovative financing mechanisms have become a permanent fixture on the international aid landscape, but they need to be further developed.

The first round table took stock of progress made with the main innovative financing mechanisms and pointed out how important it is to further develop them.

- Youssef Amrani, Secretary General of Morocco’s Foreign Ministry, gave a presentation on the air-ticket solidarity levy: implemented in 12 countries, is has now raised nearly US$ 800 billion since 2006. He also announced Morocco’s intention to implement an air-ticket levy shortly.

- Jorge Bermudez, Executive Secretary of UNITAID, then showed how, with this money, UNITAID has been able to effectively fight AIDS, tuberculosis and malaria in lowering treatment costs and helping to generalize access to treatment in over 90 countries. Over 11 million treatments were able to be rapidly administered to ill people, particularly those living in the least developed countries. Every year, UNITAID saves 100,000 children suffering from AIDS a year.

- Ivan Lewis, Minister of State for Foreign and Commonwealth Affairs, then presented the IFFIm, created in 2006, which raises substantial resources (over US$4 billion in 20 years) to finance far-reaching vaccination programmes throughout the developing world using advance market commitments from donors. The stable, predictable, sustainable funds raised which complement official development assistance are managed by the Gavi Alliance, presented by its Chief Financial and Investment Officer, Alice Albright, who manages vaccination programmes and monitors their feasibility. The first programmes financed by the IFFIm are expected to help save over 500 million children.

- Susan McAdams, Director, Multilateral and Innovative Financing at the World Bank explained how AMCs work and their objectives. The AMCs were launched in 2007 at the instigation of several countries and the Gates Foundation. They aim to raise enough resources (US$1.5 billion) to finance a new pneumococcal vaccine. Since demand in poor countries is neither solvent nor stable, pharmaceutical companies have traditionally focused their efforts on diseases affecting the richest countries. Over 800,000 children in developing countries die every year from pneumococcal disease while advanced research has been done on how to treat the virus. AMCs were developed to correct this deadly problem of the pharmaceutical market. They are expected to save 7 million lives by 2030.

The Leading Group welcomes the success stories of these first mechanisms. They all have an innovative approach based on the mobilisation of stable and predictable resources, overall investment in a development-geared sector - the health sector - and particularly in a niche market that has been ignored to date because of insufficient funds (negotiation of treatment costs, vaccination, research into new vaccines) and inclusive use in coordination with others working in the aid field.

16 June 2009

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