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Resource Mobilization Strategy for the 2012-2015 Phase of Implementation of the Global Malaria Action Plan

(May 2012) Table of Content Executive Summary 1. Introduction 2. Context 2.1 GMAP environment 2.2 Funding trends and funding gap 2.3 Health and development context 2.4 Economic return of investment in malaria Box 1 - Return on investment in malaria - Examples from three African countries 3. Resource needs and funding patterns 3.1 Overview of needs and funding 3.2 Needs and funding from a regional point of view 3.3 Needs and funding from a sectoral point of view 3.4 Are the GMAP data on resource needs still valid? 3.5 Funding target of this resource mobilization strategy 4. Funding sources and resource mobilization scenarios 4.1 Domestic investments 4.2 Multilateral funding mechanisms: Global Fund, World Bank and Regional Banks 4.3 OECD/DAC donor governments 4.4 Aid from emerging economies 4.5 Philanthropy and private sector’s social investment 4.6 Innovative financing 4.7 Resource mobilization scenarios 5. Resource mobilization strategy overview Box 2 - Cost efficiencies in LLIN procurement 6. SWOT analysis, roles and responsibilities and budgetary implications 6.1 Fundraising capacity of the RBM Partnership: SWOT analysis 6.2 Roles and responsibilities in the RBM Partnership 6.3 Budgetary implications 7. Conclusions and Recommendations Annexes Annex I Summary of PESTEL analysis of the GMAP resource mobilization environment Annex IIa. Aid investment in malaria control from OECD/DAC and BRIC governments and simulation of increased investments Annex IIb. Domestic investment in health and malaria control from high-burden African countries and simulation of increased investments Annex III. Explanatory note on the resource mobilization scenarios Annex IVa. and IVb. Terms of Reference and Membership of the Resource Mobilization Sub-Committee Annex V. Papers produced in preparation for the Resource Mobilization Strategy and other sources

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Executive Summary At its 19

th Meeting in December 2010, the RBM Board decided to create a Resource Mobilization Sub-

Committee with the objective of developing a resource mobilization strategy, including traditional and new donors and innovative financing mechanisms, aimed to fill the funding gap for the 2012-2015 phase of implementation of the Global Malaria Action Plan (GMAP). This document presents the proposed strategy and related recommendations. Funding for malaria has increased dramatically in the past decade – with commitments from less than US$200 million in 2004 to US$1.8 billion in 2010 – and has led to an unprecedented record of results and impact. There are clear indications that the international community is maintaining commitment, and including funding commitment, to the goals that first prompted the creation of the RBM Partnership and the launch of the 2008-2015 GMAP. At the same time, it is also recognized that maintaining the current annual income level, or even increasing it only marginally, is not adequate to provide all the resources that are needed to achieve the 2015 GMAP Objectives and Targets, namely to reduce global malaria deaths to near zero, to reduce global malaria cases by 75% and eliminate malaria in ten new countries. In this context, the Global Fund's capacity to finance the fight against the three diseases over the next few years is of particular concern to the malaria community. Estimates of the resources that the Global Fund could make available in the period 2012-2015 have evolved over the past few months. As of today, the Global Fund resources are likely to be far less in the near future than what they used to be in prior rounds and, also importantly for the GMAP targets, these funds may not be available until very late into the timeframe of implementation of this strategy. The Global Fund estimates are still evolving and this strategy tries to mitigate this uncertainty by also focusing on other funding options. The aim of this resource mobilization strategy is to propose to the RBM Partners a menu of possible approaches to raise sufficient, predictable and sustainable resources for malaria prevention, control and elimination over the next few years. This document is meant to propose directions for the RBM Partnership to guide strategic deployment of efforts and mobilization of influential actors, both internally within the Partnership and externally in the development community and in endemic countries, to maximize funding for the GMAP. Resource requirements for global malaria prevention, control and elimination were estimated in the GMAP to amount to some US$6.1 billion annually between 2012 and 2015, including US$5.3 billion on average for programme costs in 109 endemic countries and US$700-800 million for global research and development of new GMAP technologies. In this resource mobilization strategy, the GMAP country needs have been updated based on UNSEO/ALMA estimates (2011). Also, based on input by RBM Partners from the Research & Academia constituency, it is proposed to use the upper range of the estimated needs for research and development. It is noted, however, that R&D financing requirements rely on optimistic assumptions about the need for new classes of drugs, diagnostics, and other interventions; additional research has been commissioned to determine the R&D costs associated with the elimination/eradication agenda

1. In order to accommodate the upper range of research and

development requirements, the estimates of the needs for the Global Plan for Artemisinin Resistance Containment and the initial WHO estimates for the Global Plan for Insecticide Resistance Management have also been taken into account. The annual requirements for global malaria prevention control and elimination would therefore amount to US$26.9 billion 2 for 2012-2015. Assuming projected ongoing funding, materialization of already made commitments and success with some easier-to-reach funding targets, the hardest part of the funding gap (or the most difficult-to-reach fundraising target) could be estimated at US$9.7 billion for 2012-2015 (or US$2.4 billion on average per year). Details on these figures are provided in section 4.7 on the resource mobilization scenarios.

1 The estimate of R&D resource needs is based upon the findings of Staying the Course? Malaria Research and Development in a Time of Economic Uncertainty, PATH, 2011, with further input provided by members of the R&A constituency, including the Innovative Vector Control Consortium, IS Global, Medicines for Malaria Venture, PATH Malaria Vaccine Initiative, and the University of Melbourne, and as revised based on the discussions at the Resource Mobilization Sub-Committee. A further refinement of resource needs estimates is expected in 2013, when a project to cost the R&D needs of the eradication agenda is expected to be completed. Among the new classes of drugs required, for example, would be those targeting the sexual stages of the parasite and, for P. vivax malaria, hypnozoites. 2 The costs of the coordination of the global mobilization of efforts in support of the GMAP are not included in these estimates. These costs (as budgeted in the RBM Partnership Work Plan) are approximately US$20 million in 2012, including currently funded as well as unfunded costs.

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Category 2012 2013 2014 2015 USD

Country needs1 5'760'000'000 5'714'000'000 5'628'000'000 5'527'000'000R&D (including on resistance) 1'070'000'000 1'070'000'000 1'070'000'000 1'070'000'000

Total needs 6'830'000'000 6'784'000'000 6'698'000'000 6'597'000'000 26'909'000'000

Projected as available/easier to fundraise 3'900'000'000 4'240'000'000 4'570'000'000 4'500'000'000 17'210'000'000

Projected funding gap 2'930'000'000 2'544'000'000 2'128'000'000 2'097'000'000 9'699'000'0001 GMAP estimates except UNSEO/ALMA estimates for Africa (projecting to 2012-2015 the 2010 needs for Africa at US$2.7 billion) There is also scope for focusing and developing in stages this challenging fundraising effort. While financial support is needed for the whole range of malaria endemic countries and for the whole range of interventions, a selected number of countries and regions and some sectoral needs may need special and urgent support, because of their impact on the burden and achievement of the 2015 GMAP objectives and targets (most importantly, the objective of achieving near zero malaria deaths) and because of the risk that the unfolding global financing difficulties jeopardize their progress. Since the vast majority of deaths are occurring in sub-Saharan Africa, the focus on eliminating deaths from malaria means there has to be a greater focus on Africa and on essential commodities. The financing gap for Africa in terms of costs for commodities and their delivery is estimated to be approximately US$3.2 billion for the four year period 2012-2015. A concentration on raising these funds and supporting national capacity to prevent, diagnose and treat malaria in Africa will reduce global deaths from malaria by as much as 90%. Most of the remaining gap in financing is to develop good strategies to delay or overcome resistance to drugs or insecticides, with the gap for Asia, Latin America/Caribbean and the Middle East expected to largely be met from domestic resources and ongoing programmes. With this background, this resource mobilization strategy reviews in detail the current status and potential from funding sources that are central in the current context of international development: domestic investments, multilateral funders, traditional donors that are members of the Development Assistance Committee of the Organization for Economic Cooperation and Development (OECD/DAC), emerging economies, philanthropists and social investors, innovative financing mechanisms (chapter 4). Based on the analysis of the status and potential of the funding sources, some high-level estimates of possible levels of fundraising efforts to fill the 2012-2015 funding gap are proposed in section 4.7. This strategy suggests accordingly selected fundraising streams to pursue, and, for each stream, the following menu of strategic actions (chapter 5): A) Mobilize growing domestic public sector funding

� Encourage African and Asian endemic countries to engage to progress towards more ambitious domestic funding targets.

� Work with robust emerging economies such as Brazil, China, India and Indonesia, to maintain and increase domestic spending for adequately cover their own needs.

B) Maintain and expand the funding base from traditional donors

� Maintain G7 leadership in funding the next phase of the GMAP implementation: seize the opportunity that the next two G8 Summits will be hosted by supportive governments (US, UK) to continue to support the GMAP objectives, the Global Fund’s fundraising effort and integration of malaria prevention, control and elimination in maternal and child health.

� Build convincingly the case for GMAP support and links to maternal and child health agenda with a selected group of other OECD/DAC governments having the potential to become more relevant bilateral and multilateral donors for malaria.

� Work with the European Commission to tap into the new EC/ACP resources for the achievement of the MDGs and maternal and child health.

C) Increase aid for malaria prevention, control and elimination from emerging economies

� Establish dialogue with aid decision makers in emerging economies such as Brazil, India and China on ongoing and potential support to countries/region of geo-political priority that are high burden countries with funding gaps.

� Recruit at least one champion from emerging economies for profiling malaria financing in the G20 development agenda emerging from the Seoul Development Consensus for Shared Growth.

� Profile malaria funding in ongoing discussions of trilateral development agreements between emerging economies, OECD-DAC/regional development banks/multilateral donors and third countries.

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� Explore interest in malaria funding from other emerging economies that are increasing substantially their aid packages.

� Retain funding commitment from Russia, and mobilize Russia’s political support for positioning malaria in the G8 development discussions.

D) Frontload resources to accelerate impact of domestic investments and aid

� Take forward discussions with the World Bank and African Ministers of Finance on options for loans from the World Bank's IDA, with a focus on the 16

th and 17

th Replenishments.

� Explore reprogramming options with the Global Fund to maximize Global Fund’s resources for the GMAP for the 2012-2015 period, including in the context of the current reprioritization process.

� Pursue opportunities with regional banks to support substantial scaling up of funding for regional GMAP needs and synergistic results with other health objectives, e.g. through matching mechanisms and incentives for regional cooperation.

E) Apply innovative financing solutions

� Create a dedicated innovative financing mechanism in support of the 2012-2015 needs, e.g. in the form of a malaria bond.

� Support UNITAID in ongoing fundraising efforts to bring in new countries adopting air taxes and voluntary air-travel related contribution schemes, while maximizing the opportunities for malaria that are being offered by the 2011-2012 UNITAID calls for proposals on diagnostics and drug procurement and, potentially, a challenge grant for new technology for LLINs.

� Further explore use of remittances and Diaspora bonds to increase domestic resources for malaria prevention, control and elimination.

� Explore options for additional debt conversion deals (within and outside the Global Fund Debt to Health mechanism) in support of the GMAP.

� Expand use of the UN Foundation Pledge Guarantee for Health. F) Encourage sustained private sector and philanthropic support

� Outreach to private sector actors in endemic countries in Africa to identify opportunities for corporate engagement in support of domestic malaria prevention, control and elimination needs.

� Engage the private sector in emerging economies to contribute to filling domestic and international needs, including through innovative financing mechanisms.

� Develop ideas to solicit additional support from foundations, e.g. in the form of challenge grant or matching gift mechanisms, in collaboration with the Gates Foundation or other major partner foundations.

G) Explore cost efficiencies and better integrated services to decrease resource needs3

� Identify more effective ways of procuring LLINs. � Reduce overlap of LLIN and IRS programs, at least until more is known about the possible

benefits of providing them together. � Rotate insecticides used for IRS to delay resistance. � Accelerate the availability and appropriate use of RDTs. � Better understand the efficiencies of integrated health packages including systematically

malaria prevention, control and elimination components. Special Focus on Africa. The vast majority of deaths are occurring in sub-Saharan Africa. The financing gap for commodities and their delivery is US$3.2 billion from now until the end of 2015. Based on current discussions strategic action on this special focus objective would include:

� US$1 billion anticipated from the Global Fund which will be applied to 2015 targets and could potentially fully fund 2015 needs for Africa with the exception of except Nigeria, the cost driver in the continent

4;

� US$ 1 billion needed for Nigeria for 2012-15 to be addressed by a special support group, including the federal and state governments of Nigeria and committed donors;

� US$ 0.6 billion for 2012-2014 for African countries (except Nigeria) to be mobilized through development banks' loans and the Global Fund’s Transitional Funding Mechanism;

3 Based on findings and recommendations from CHAI, " Value for Money in Malaria Programming: Issues and Opportunities", 2011, and recent data provided by Results For Development (R4D). 4 It is hoped that the Global Fund to Fight AIDS, Tuberculosis and Malaria, which has been a leader in enabling the funding

successes of the last few years, will provide funding to meet two-thirds of the total gap, in line with the proportion it has previously funded.

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� US$ 0.6 billion, the remaining funding gap, to be mobilized 2012-2014 through other donors, still to be identified.

This resource mobilization strategy can only be successful if it has full ownership by the RBM Partners and Mechanisms, which all need to be engaged, based on their capacity and comparative advantage, in this collective effort to mobilize the resources that are needed to fully fund the global fight against malaria. A central piece of this strategy is therefore also the assessment of the overall capacity of the RBM Partnership to pursue the proposed resource mobilization objectives and the identification of expected roles and responsibilities in implementing this strategy. This strategy concludes with a set of recommendations for the Board for an effective implementation of the strategy, to:

� endorse the funding target and the fundraising streams described in this strategy, with an immediate focus on the GMAP target of reaching near zero malaria deaths by 2015 and with a view to getting as close as possible to filling the funding gap of the GMAP for 2012-2015.

� commit to proactively support this resource mobilization strategy and invite Board Members to

volunteer to mobilize their political leverage, expertise and contacts to serve this strategy.

� encourage further bilateral and multilateral support in support of the 2012-2015 needs, with a view to making additional funding available to high-burden countries.

� encourage Board Members to urge high-burden endemic countries to engage their Ministers of

Finance in supporting increased domestic investments for malaria prevention, control and elimination and, in consideration of the urgency of scaling up funding, looking at ways to frontload resources, including by applying for loans from the 16

th and/or 17

th IDA

Replenishments.

� invite Board Members from emerging economies to contribute to scale up their bilateral and multilateral support to malaria endemic countries to achieve the MDGs by 2015, both through increased investments for domestic needs and by positioning malaria prevention, control and elimination high in their aid agendas and budgets.

� request the RBM Executive Director to support the follow-up to these recommendations and

help develop a harmonized tracking system for resource needs, commitments, funding flows and funding gaps, so as to develop a more robust and consistent base of data, including for countries outside Africa, in support of an effective implementation of this strategy.

� urge each Partner to confirm commitment to make ending of malaria deaths a major

development priority for the next four years.

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1. Introduction Funding for malaria has increased dramatically in the past decade – with commitments from less than US$200 million in 2004 to US$1.8 billion in 2010 – and has led to an unprecedented record of achievements and impact. As highlighted in the 2011 UN Report on the Millennium Development Goals, this substantially increased investment in malaria is having a remarkable impact on the progress towards the MDG 6. Deaths from malaria have been reduced by 20 per cent worldwide, from nearly 985,000 in 2000 to 781,000 in 2009, with the largest decrease having taken place in Africa, where 11 countries have reduced malaria cases and deaths by over 50 per cent. This record of achievement provides a strong argument for this resource mobilization strategy and for a reinvigorated call for support to close the funding gap for the 2012-2015 phase of the GMAP implementation. There are clear indications that the international community is maintaining commitment, and including funding commitment, to the goals that first prompted the creation of the RBM Partnership and the launch of the Global Malaria Action Plan (GMAP) 2008-2015. Among them, it is important to note the G8 commitments to continued funding for GMAP as re-stated in the 2011 Deauville Accountability Report on Health and Food Security, and including significant funding increases by the UK and the US, the 2011 Resolution of the UN General Assembly on "Consolidating gains and accelerating efforts to control and eliminate malaria in developing countries, particularly in Africa, by 2015", the ongoing World Bank's Booster Program in Africa and the Bill and Melinda Gates Foundation's Malaria Strategy, as well as the remarkable increase in the success rate of funding proposals to the Global Fund over the last four rounds. At the same time, it is also recognized that maintaining the current annual income level, or even increasing it only marginally, is challenging and not adequate to meet the funding 2012-2015 requirements for the GMAP. To achieve the objectives set in the GMAP, financial support must continue and grow, and must allow for substantial scaling up and sustainable maintenance of achievements at country level. It is important in this context to emphasize the close link between funding and the life saving value of malaria control. The Progress and Impact Series Report on saving lives5 has eloquently highlighted this point:

5 Saving Lives with Malaria Control: Counting Down to the Millennium Development Goals, RBM Progress and Impact Series n.3, September 2010

Children saved by vector control based on 2011–2015 scale-up scenariosWith rapid scale-up to universal prevention by 2010 and maintained until 2015 (Line A), an estimated

2.95 millionchildren would besaved;with scale-up to universal prevention bytheend of 2015(LineB),about

2.15million children would besaved;with current countryscale-up trendscontinued on thesameslopeuntil

2015(LineC),about 1.14 million children would besaved;with current country coveragetrendsstabilized at

2010levels(LineD),about 906000children would besaved;but if funding ceased and nonew vector-control

serviceswereavailable (LineE),about 476000children would die (compared with thescenario of LineD).

100%coverage in 2010

100%coverage in 2015

Ceased funding

Maintaining current coverage

Continuing current trend

0

100

200

300

400

500

600

700

2000 2005 2010 2015

A

B

C

D

E

Yearly 1–59 month child malariadeathsprevented(thousands)

Year

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The urgent need for more resources has been further highlighted, over the last few months, by the evolving information about the level of Global Fund's funding that is expected to be available over the next few years. This is expected to impact on its capacity to continue supporting the 2012-2015 phase of the GMAP as significantly as previously. With this background, the aim of this Resource Mobilization Strategy is to allow the RBM Partners to agree on approaches towards sufficient, predictable and sustainable resources to meet the 2015 GMAP Objectives and Targets. While the timeframe of this strategy is 2012-2015, a post-MDG reflection is ongoing within the development community, to explore how to take forwards key development objectives, including in health, beyond 2015. The overall directions and opportunities identified in this resource mobilization strategy for the RBM Partnership are likely to continue to be relevant, in the longer term, subject to adjustments over time. This document is organized as follows. After the introduction (chapter 1):

Chapter 2 outlines the global context in which the GMAP and this resource mobilization strategy operate, highlights key areas where malaria can influence outcomes in other health and developments areas and explains the comparative advantage of malaria prevention, control and elimination as an investment with high return. Chapter 3 describes the resource needs for 2012-2015, as estimated in the GMAP and revisited/validated in subsequent analysis.

Chapter 4 explores sources of current and potential funding at both international and domestic levels, makes assumptions regarding the size of potential inflow and proposes steps forwards to tap into those sources. Chapter 5 provides the strategy overview, suggesting fundraising streams to pursue, and, for each stream, a menu of strategic actions. Chapter 6 reviews the capacity of the Partnership to contribute to the implementation of this strategy and summarizes accordingly key responsibilities and accountabilities. Chapter 7 draws conclusions and recommendations. The annexes provide references to the background and preparatory work that has supported the content of this strategy.

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2. Context 2.1 GMAP environment There have been significant changes in the recent years in the environment in which the GMAP operates. These environmental variables may have an important impact on resource mobilization outcomes and need to be taken into account and kept under close monitoring in developing and implementing this resource mobilization strategy. As part of the development of this strategy, the RBM Resource Mobilization Sub-Committee has decided to carry out with its members a review of these macro-determinants with a focus on Political, Economic, Social, Technological, Environmental and Legal variables (PESTEL analysis). The full analysis gridline is shown in annex 2. This analysis has identified in particular, among the key drivers: � on the positive side, the still strong drive represented by the effort to achieve the Millennium

Development Goals by 2015, with an increased emphasis on maternal and child health; � the current financial and economic vulnerability of traditional donors, with connected debt burden,

recession and currency fluctuations, which has prompted a period of uncertainty around the perspectives for funding development from traditional official development assistance (ODA);

� the change in the culture of aid (due to both the financial crisis faced by traditional donors and the emergence of new development donors and processes, such as the emerging economies in the G20, the influence of powerful philanthropists and the development of innovative financing mechanisms), with much more emphasis on principles such as value for money, cost effectiveness, performance based funding and economic return.

These aspects will be looked at more in detail in the sections and chapters that follow. The range of opportunities and threats that these and other determinants represent for the RBM Partnership in implementing this resource mobilization strategy will be reviewed in section 6.1. 2.3 Malaria in the global health and development context As highlighted in the section above, fundraising for malaria prevention, control and elimination does not take place in isolation from the broader context of global health and development financing. In the current resource-constrained environment, it is important for the RBM Partnership to map out systematically competitive challenges and opportunities for synergies with other health and development areas that are receiving attention, and funding commitments, from the development community. Some of the most prominent health and development areas where strengthened synergies could support fundraising for the GMAP for 2012-2015 are summarized below. 2.3.1 Maternal and child health. MDGs 4 and 5 on child and maternal health are among those at most risk of remaining unmet without strong support. Malaria impacts more severely on pregnant women and children, and funding for malaria prevention, control and elimination has a crucial role in addressing effectively maternal and child health, since well funded malaria interventions can be used as vehicles for other maternal and child health interventions. It has also been shown convincingly that addressing malaria leads to a decline in all causes of mortality in children over and above malaria mortality. At the same time, funding for maternal and child interventions could support integrated packages including systematically malaria prevention, control and elimination components. For example, bed nets and preventive treatments can be distributed mainly through antenatal and child health clinics or through campaigns that include other interventions such as immunizations or nutritional activities. The most relevant funding envelope for maternal and child health is the Muskoka Initiative on Maternal, Neonatal and Child Health, which engaged G8 governments in mobilizing US$5 billion by 2015 above the 2008 baseline to reduce the number of maternal, new born and under-five child deaths in developing countries. The Governments of the Netherlands, New Zealand, Norway, the Republic of Korea, Spain and Switzerland, the Bill and Melinda Gates Foundation and the UN Foundation joined the Initiative with an additional funding of US$2.3 billion to be disbursed over the same period. Based on the Accountability Report from the Deauville Summit, prepared under the 2011 French Presidency of the G8, it is anticipated that, over the period 2010-2015, the Muskoka Initiative will have mobilized more than US$10 billion. It should be noted that the G8 count 46% of pledges to the Global Fund since 2010 as a contribution to the Initiative. More recently it has been reported that close to US$45 billion has been committed to the UN-led "Every Woman Every Child" initiative, including about US$11 billion

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from the poorest countries and US$14 billion from high-income governments. While several of these figures may overlap, it is clear that there is a momentum around maternal and child health in which the fight against malaria could have the opportunity to retain a high profile. 2.3.2 Health system strengthening. Evidence shows that investment in malaria has an important impact not only on reducing mortality and bed occupancy in hospitals and health centres due to the success of preventive interventions, improved diagnosis and early treatment, but also on reinforcing directly the capacity of health systems (e.g. by supporting delivery capacity, epidemiological surveillance, accountability mechanisms, monitoring and evaluation). Like for maternal and child health, there is potential for cost efficiencies and more impact if malaria interventions are part of integrated services providing a comprehensive primary health care package allowing shared capacity for services. This includes a close attention to human resources and recruitment and deployment of community health workers, who are particularly important in this effort for a more integrated approach. With appropriate supervision and reliable supplies of medicines and health commodities, extension workers are crucial resources to provide packages of essential preventive and treatment services. The G8 made a commitment at the 2007 Heiligendamm Summit to mobilize US$60 billion for the fight against the three pandemics and for health system strengthening over the period 2008-2012. The main channels for health system funding from external aid are currently general or sectoral budget support and support to sector wide-approaches by major donors, as well as the Health Systems Funding Platform of the GAVI Alliance, the Global Fund, the World Bank and the World Health Organization. 2.3.3 There are other development areas that have an existing or potential link to malaria investments, such as nutrition (under the global food security and nutrition agenda), water and sanitation and, potentially, climate change adaptation, as climate change will most certainly affect GMAP needs, though with variable patterns that are still difficult to predict and map. So far, funding commitments have been less concrete on these development areas: the US/Ireland-led 1000 Days Initiative on Nutrition and the Scaling Up Nutrition Platform are more focused on political rather than funding commitments; the G8 made a pledge both in 2003 and 2005 to increase funding for the water sector, but without clear targets; the UN Framework Convention on Climate Change has called for the establishment of a global Green Climate Fund that is expected to allocate US$100 billion a year by 2030 to finance, among others, climate change adaptation initiatives in developing countries, but this funding mechanism is still in the planning phase. These areas are nevertheless likely to become more profiled in the global development agenda in the future and synergistic programmatic and funding opportunities should be explored and monitored closely, seized as soon as they become relevant and conveyed in advocacy and communication products. 2.4 Economic return of investment in malaria Malaria, even when it does not kill, is a debilitating disease with a heavy burden on health costs and lost productivity. High prevalence of malaria is associated with persistent and large reductions of economic growth rates, estimated by the Commission on Macroeconomics and Health in 2001 at the level of at least 1 percent per year. Increased, predictable and sustainable investment in malaria prevention, control and elimination is therefore a wise investment in periods of financial constraints, with a high return for investment. A 2008 study by Malaria No More and Mc Kinsey on the business case for rapid scale up of malaria control in Africa has argued that a rapid acceleration of investments in malaria control at the level of 10% annual growth over five years, including through frontloading mechanisms, could increase the annual gross domestic product in Africa by more than US$20-30 billion, thanks to increased productivity of a healthier workforce, growth of foreign direct investment and other economic externalities, such as revenue from more tourism. Additional data have been collected and evidence developed by RBM Partners on the economic impact, among others, of sustaining malaria control and elimination in five countries (Ethiopia, Rwanda, Senegal, Tanzania Mainland and Zanzibar, Zambia). A few examples are highlighted in the below box 1:

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Box 1 - Return on investment in malaria - Examples from three African countries In the Tigray Region in Ethiopia malaria costs households between 4% and 13% of their annual income. Over the next five years, if Ethiopia can sustain its malaria control program, it is estimated that it could avert about $427million in household costs: $76 million in direct costs and $351 million in indirect costs. This is the equivalent of about 8% of household income, a very large savings for a typical household. In Rwanda, prior to scale-up of malaria control, treating malaria cases was costly to the public health system—an estimated 19% of the recurrent budget of the Ministry of Health was directed to malaria. By preventing resurgence, sustained control over the next five years (2011–2015) could save the public health system an estimated $267 million in the costs of diagnosing and treating out-patient and in-patient malaria. Most of these cost savings would allow health sector resources (e.g., health workers’ time, hospital beds) to be devoted to other diseases. At the same time, some resources could be invested into strengthening and expanding prevention and surveillance activities to maintain a reduced burden of malaria. In Tanzania, Said Salim Bakhresa & Co. (SSB) is an African-owned flour mill company based in Dar es Salaam. After a study found that one in five of its employees contracted malaria each month, SSB launched a malaria control program in 2008. It distributed ITNs to its 6,000 employees and their families and offered free testing and treatment at its three onsite clinics. It also established a diagnostics and training center at the company’s headquarters. After implementing the program, employee absenteeism related to malaria fell by 80%. The company now spends a third of what it used to spend on malaria medication at its clinics—monthly drug costs fell from US$10,000 to $3,400. From: "Maintaining the Gains in Global Malaria Control", Clinton Health Access Initiative (in partnership with the Evidence to Policy Initiative of the Global Health Group at the University of California San Francisco, and the African Leaders Malaria Alliance), October 2011

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3: Resource needs and funding patterns 3.1 Overview of needs and funding Resource requirements for global malaria prevention, control and elimination were estimated in the 2008 GMAP to amount to some US$5.3 billion annually between 2012 and 2015 for programme costs in 109 endemic countries and US$700-800 million annually, over the same period, for global research and development of new technologies. The GMAP shows the following breakdown of global financing sources in 2007: external assistance: 47%; national government spending: 34%; private sector spending: 19%6. The principal sources of external aid have been so far the Global Fund (approximately 76% for the period 2002-2009), the US President's Malaria Initiative (PMI) (15%), the World Bank (8%) and other OECD/DAC (7%). In 2009, all these donors together committed approximately US$1.6 billion and disbursed US$1.5 billion. 3.2 Needs and funding from a regional point of view The two regions with the largest funding requirements are Africa (US$2.7 billion annually7 on average for the period 2012-2015) and Asia and the Pacific (US$2.6 billion annually on average for the period 2012-2015). In Africa, the main cost driver is Nigeria (more than US$450 million annually) with Ethiopia, DRC, Uganda, and Tanzania all exceeding US$100 million. These countries account for a large percentage of the population at risk and deaths in the continent. The other highest-death burden countries in Africa are Burkina Faso, Chad, Côte d'Ivoire, Mozambique and Niger. Domestic public sector spending for malaria prevention and control in these high-cost countries ranges between close to 0 to 30-40% of their GMAP estimated annual needs. Based on the OECD/DAC International Development Statistics Database, OECD/DAC donors for malaria prevention and control in the countries that drive the costs in the continent and bear the highest burden have been, over the last five years8: - Burkina Faso: Austria, France, Italy, Japan, Spain; - Côte d’Ivoire: Japan; - DRC: Australia, Belgium, Japan, South Korea, US; - Ethiopia: Australia, Canada, Greece, Italy, the Netherlands, Spain, UK, US; - Mozambique: Canada, France, the Netherlands, Portugal, Spain, UK, US; - Niger: Canada, Italy, Japan; - Nigeria: Canada, Italy, Spain, UK, US; - Tanzania: Australia, Canada, Italy, Japan, the Netherlands, Spain, UK, US; - Uganda: Australia, Belgium, Canada, Germany, UK, US. In Asia, six out of the ten countries with the largest share of population at risk worldwide are located in this region (India, China, Indonesia, Bangladesh, Vietnam, Philippines). India bears a share of 45% of all malaria cases in the region. Three cost drivers in the continent are emerging economies: India needs US$7.6 billion for the period 2012-2015 Indonesia needs US$652 million and China needs US$397 million. The Global Fund has invested substantially in all three countries (in Indonesia including through a debt conversion scheme with Australia and Germany which so far has brought some USD 60 million to be used for Global Fund's grants - potentially including malaria grants). Overall, aid to India has decreased substantially, while aid to China was still increasing in 2009. The other major foreign aid source in 2009 was the World Bank for India, and multilaterals (UNICEF and WHO) as well as OECD/DAC governments for Indonesia and Myanmar (the other high-burden country in Asia)9. The data from the 2010 World Malaria Report (WMR) are not sufficiently detailed to understand the proportion of domestic investment in malaria in these three countries. However, these countries are

6 The proportion of private sector spending is difficult to track consistently. For example, looking at the ten GMAP cost-driving countries, the WHO Statistical Information System estimates that private expenditures represent only 11% of health spending in Angola, but more than 50% in Ethiopia, Kenya, India, Indonesia and Nigeria, and around 80-90% in DRC, Myanmar, Sudan and Uganda. In Angola, Myanmar, Nigeria and Sudan, virtually all these private expenditures are out-of pocket contributions. Out-of pocket expenditures should be taken cautiously in prospecting health financing approaches because, as widely reported, they affect disproportionally the poorest. To ensure equity in access to health care, the 2010 World Health Report recommended that funding from out-of-pocket expenditures should not exceed 15-20% of total health expenditures and that it should rather be converted into pooled funding and prepayment schemes, including community financing programs supported by public funding where feasible. 7 The needs for Africa are based on a recent analysis led by UNSEO and ALMA which reviewed the GMAP cost estimates and projected to 2012-2015 the 2010 needs for Africa at US$2.7 billion. 8 The OECD/DAC database does not record any donor for malaria activities in Chad. 9 Respectively, New Zealand and Spain for Indonesia and Japan and Norway for Myanmar.

12

also members of the G20, which suggests that their funding gap could be substantially supported through increased domestic investments. The Greater Mekong sub-region is experiencing increased resistance to artemisinin and insecticides. Investment in malaria prevention and control in this sub-region has therefore a clear global public good value, as it would contribute to addressing the threat of spreading resistance within the continent and globally. The cost of addressing resistance on the border areas between Cambodia, Myanmar, Thailand and Vietnam and preventing global spread of resistance has been calculated in the GPARC at around US$175 million annually until 2015 and is additional to the GMAP resource needs. The resource needs for the 22 malaria endemic countries in the Americas (which include three major emerging economies, namely Brazil, Mexico and Venezuela) amount to US$233 million annually on average for 2012-2015. 40% of malaria deaths in the continent occur in Brazil, which is the cost driver in the continent (US$100 million needed annually on average for 2012-2015). Brazil’s domestic investments, as reported in the WMR, are fully adequate to meet these domestic needs, though since 2007 Brazil has also received support from the Global Fund, the US and the World Bank. The most acute needs in the Americas are for the countries of the Amazon Basin (Bolivia, Brazil, Colombia, Ecuador, Guyana, Peru, Suriname and Venezuela), which bear the highest burden of mortality and where the malaria epidemic is concentrated among isolated, indigenous populations (US$300 million excluding Brazil). The Global Fund has invested so far US$12.7 million for the countries of the Amazon Basin (which adds to a US$25 million grant, in the closure phase, for a sub-regional project on the cross-border areas of the Andean Region), the World Bank US$350,000 and OECD/DAC donors some US$2.6 million (Spain and the US). The modest and relatively concentrated funding gap for this region could be expected to be appropriately covered through national and regional investments. In the Middle East and Eurasia, needs are for US$164 million annually for 2012-2015. Three countries (Pakistan, Afghanistan and Yemen) account for more of 99% of the 56,000 regional deaths. In Eurasia, the objective is elimination. Resources from domestic spending amount to 89% of total funding. However, Pakistan, Afghanistan and Yemen still need support by international funders. The Global Fund has invested so far US$52 million in the three countries (in Pakistan including through a debt conversion scheme with Germany), the World Bank US$2.8 million. Other funders are mainly Arab donors and Russia (the latter for elimination in Eurasian countries particularly). Continuation of the current efforts of these regional donors could help these countries to manage their relatively limited funding shortfall. 3.3 Needs and funding from a sectoral point of view Prevention represents the highest cost in the GMAP, at around US$3.7-3.9 billion annually from 2010 up to 2020, or 70% of the total costs. Most of these costs are almost equally distributed between indoor residual spraying (IRS, 55%) and bednets (long lasting insecticidal nets – LLINs, at almost 45%), with a relatively negligible need for intermittent preventive treatments (for children, infants, pregnant women – IPT, less than 1%). Because of the significant proportion of the GMAP resource needs in this category, cost efficiencies in the area of prevention would have a major impact in reducing the GMAP cost tag. Case management (rapid diagnostic testing, artemisinin-based combination therapy, drugs to address other malaria strains and management of severe malaria) represents some 20% of needs in the initial scale up phase (which was estimated in the GMAP to reach a pick in 2011). The GMAP projected that the success in prevention and reduction of over-treatment of fevers with antimalarials would prompt a drastic decrease in the cost of case management (to less than 10%), which would be particularly significant between 2012 and 2015. Programme support, in the form of infrastructure, monitoring and evaluation, operational research at country level, training, salaries and other costs for the deployment of community health workers, is estimated to require 14-19% of resources and remain relatively stable between 2012 and 2015. This is described in the GMAP as a cost component that is particularly prone to compression through better health system synergies. A separate analysis of costs is devoted in the GMAP to global research and development, for which the estimates are for US$750-800 million annually between 2010 and 2015 for development of drugs, vaccines and diagnostics, vector control and analysis of effectiveness and impact. The importance of research and development cannot be overestimated. Over the last ten years, innovations in long-

13

lasting insecticidal nets, artemisinin combination treatments and rapid diagnostic testing have transformed the malaria landscape. Research and development is part of a continuum towards implementation of effective measures that can lead to the elimination of malaria. The immediate focus for research and development is on finding transmission blocking interventions that can radically reduce the numbers of new cases as well as new molecules that address resistance. In the meantime, a scaling up of diagnostics and appropriate treatment to complement successful vector control can bring the malaria community closer to eliminating deaths from malaria. More recent estimates by RBM Partners have identified needs as at least some US$800 million annually over the four-year period 2012–2015, including support for the R&D components of the GPARC and GPIRM. A further refinement of resource needs estimates is expected in 2013, when a project to cost the R&D needs of the eradication agenda is expected to be completed. Research and development seems to have been relatively well supported by a mix of public and private donors over the past five years, though with relatively few donors and an uneven distribution of funding among the various areas that need support. 3.4 Are the GMAP data on resource needs still valid? Before looking at how to mobilize existing and potential funding sources to address the funding gap for 2012-2015, the legitimate question is whether the GMAP costing estimates are still valid, three years after having been developed, also considering that the environment around malaria is changing. As part of its work for the development of this resource mobilization strategy, the Resource Mobilization Sub-Committee has reviewed secondary data from six high-burden and high-cost countries (DRC, Ethiopia, India, Nigeria, Tanzania and Uganda) to ascertain if new data could validate the costing estimates made in 2007. While this analysis was of limited scope due to its reliance on secondary data, country information seems to confirm that the GMAP, overall, did not overestimate the projected resource needs. Rather, it may be argued that some costs may have increased in the meanwhile, due to different factors:

• As several of the 2010 targets have not been achieved and most countries have accumulated delays in the GMAP implementation (including because of insufficient funding and funding delays), the costs of the scaling up phase are still substantial for most countries and some of the resource needs that have not been met since 2008 will need to be added to the costs originally estimated for the years to come.

• A more compelling set of milestones has been set in 2011 for achieving the 2015 GMAP Objectives and Targets as compared to the original GMAP framework, requiring an accelerated scaling up of efforts.

• The GMAP estimates did not factor in all costs, notably the needs for the Global Plan for Artemisinin Resistance Containment (GPARC), launched at end 2010 and those for a plan for insecticide resistance management (GPIRM), which is in the pipeline. The GPARC and GPIRM costs have been estimated respectively at US$175 million and US$195 million annually between 2012 and 2015 (for the GPIRM these are very preliminary WHO estimates).

• The impact of the ongoing currency fluctuations (e.g. devaluation of the US$ over the past year) is not yet fully known, but it is likely to have an effect on current and future costs.

3.5 Funding target of this resource mobilization strategy Resource requirements for global malaria prevention, control and elimination were originally estimated in the GMAP to amount to some US$6.1 billion annually between 2012 and 2015, including US$5.3 billion on average for programme costs in 109 endemic countries and US$700-800 million for global research and development of new GMAP technologies. In this resource mobilization strategy, the GMAP country needs have been updated based on UNSEO/ALMA estimates (2011). Also, based on the above mentioned estimates by PATH

10 and input from the R&A constituency, it is proposed to use

the upper range of the estimated needs for research and development, while noting that these requirements rely on optimistic assumptions about the need for new classes of drugs, diagnostics, and other interventions. In this document, the Research and Development requirements also include the requirements for the Global Plan for Artemisinin Resistance Containment and the initial WHO estimates for the Global Plan for Insecticide Resistance Management. The annual requirements for global malaria prevention control and elimination would therefore amount to US$26.9 billion

11 for 2012-

10 Staying the Course? Malaria Research and Development in a Time of Economic Uncertainty, PATH, 2011, with further input provided by members of the R&A constituency, including the Innovative Vector Control Consortium, IS Global, Medicines for Malaria Venture, PATH Malaria Vaccine Initiative, and the University of Melbourne. 11 The costs of the coordination of the global mobilization of efforts in support of the GMAP are not included in these estimates. These costs (as budgeted in the RBM Partnership Work Plan) are approximately US$20 million in 2012, including currently funded as well as unfunded costs.

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2015. Assuming projected ongoing funding, materialization of already made commitments and success with some easier-to-reach funding targets, the hardest part of the funding gap (or the most difficult-to-reach fundraising target) could be estimated at US$9.7 billion for 2012-2015 (or US$2.4 billion on average per year). Details on these figures are provided in section 4.7 on the resource mobilization scenarios.

Category 2012 2013 2014 2015 USD

Country needs1 5'760'000'000 5'714'000'000 5'628'000'000 5'527'000'000R&D (including on resistance) 1'070'000'000 1'070'000'000 1'070'000'000 1'070'000'000

Total needs 6'830'000'000 6'784'000'000 6'698'000'000 6'597'000'000 26'909'000'000

Projected as available/easier to fundraise 3'900'000'000 4'240'000'000 4'570'000'000 4'500'000'000 17'210'000'000

Projected funding gap 2'930'000'000 2'544'000'000 2'128'000'000 2'097'000'000 9'699'000'0001 GMAP estimates except UNSEO/ALMA estimates for Africa (projecting to 2012-2015 the 2010 needs for Africa at US$2.7 billion) Since the vast majority of deaths are occurring in sub-Saharan Africa, the focus on eliminating deaths from malaria means there has to be a greater focus on Africa and on essential commodities. The financing gap for Africa in terms of costs for commodities and their delivery is estimated to be approximately US$3.2 billion for the four year period 2012-2015. A concentration on raising these funds and supporting national capacity to prevent, diagnose and treat malaria in Africa will reduce global deaths from malaria by as much as 90%. Most of the remaining gap in financing is to develop good strategies to delay or overcome resistance to drugs or insecticides, with the gap for Asia, Latin America/Caribbean and the Middle East expected to largely be met from domestic resources and ongoing programmes.

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4. Funding sources and resource mobilization scenarios The following chapters will review more in detail current funding patterns from a comprehensive range of funding sources and will identify a menu of action streams for potential for increased/new funding. In considering the funding options of all existing and potential avenues, close attention has been paid to some key criteria to decide on their suitability, with a focus on potential for:

� Prioritizing quick wins and frontloading options that can maximize acceleration of results; � Identifying sources of funding so far under-explored that show a potential to make funding

impact over 2012-2015; � Building up medium to long-term sustainability and predictability of resource inflows; � Ensuring the additionality of resources raised – e.g. by making sure to use at best the

comparative advantages of different RBM Partners in fundraising from different sources and avoid duplication of efforts;

� Optimizing the efficiency of resource mobilization efforts, in terms of cost and effort invested in comparison to financial and political benefits gained.

4.1 Domestic investments The Abuja Declaration, adopted at a 2001 summit of the Organization of African Unity, was a commitment of African States to allocate at least 15% of their annual budgets to the health sector. Analysis undertaken in 2009 for the Global Fund’s Replenishment showed that, since the Abuja Summit, many African countries had increased the proportion of their national budget allocated to health between 2001 and 2007. The WHO Statistical Information System reports that seven countries had achieved or exceeded the Abuja target in 2009, including, among the countries with the highest burden of malaria, Burkina Faso and Tanzania. Three additional countries are close to the target (Chad, Mozambique and Niger, at some 13-14%), and Uganda is at two-thirds of the path. The lowest health investments among the top high burden countries are recorded in DRC, Côte d'Ivoire and Nigeria (2 to 6%). If we look at malaria commitments, extrapolation of data from the 2010 WMR shows that the proportion of GMAP annual estimated needs that are covered through domestic investments in the public sector range from close to 0 (in five of them) to some 30% (Sudan and Uganda). The potential for higher domestic investments from the public and private sector, should be considered also in the context of the economic growth of these countries. The IMF World Economic Outlook database shows that the highest GDP growth 2009/2008 among the African countries with the highest malaria burden has been recorded, in order of size, in Uganda, Nigeria, Tanzania and Mozambique (more than 6% growth annually on average between 2008 and 2010, based on constant prices and local currency) and the lowest in Chad, Cameron and DRC (between 0 and less than 3%). If we consider the high impact that malaria prevention, control and elimination has on economic growth (Malaria No More and McKinsey & Company estimated in 2008 that an investment in malaria prevention and treatment of approximately US$2.2 billion a year for five years would increase annual GDP in Africa by US$30 billion), there is a strong case, particularly for the countries experiencing significant growth, to re-invest part of their GDP increase in malaria prevention, control and elimination, so as to prompt a multiplier effect for their economic growth. The highest burden countries in Asia are India, Myanmar and Indonesia. The 2010 WMR data are not sufficiently detailed to understand the proportion of domestic malaria investment currently being made in these countries. However, for India and, to a lesser extent, Indonesia, based on their potential as emerging economies, it could be argued that these needs could be more substantially resourced domestically. In the Americas and in the Middle East/Eurasia needs are currently covered at 91% and 89% respectively by domestic investments, and this pattern could continue to be the most appropriate, possibly with additional support from regional donors to the least resourced countries in these regions. Potential for increase A positive emulation effort between the endemic African countries experiencing economic growth towards the Abuja commitments, while at the same time prioritizing malaria prevention, control and elimination, could potentially bring substantial new resources for the GMAP in 2012-2015. An illustrative simulation, based on investment of a proportion of GDP growth, is proposed in annex IIb. This domestic investment effort could be facilitated, as illustrated in sections 4.2 and 4.6, by the World

16

Bank and other development banks' loans and innovative financing initiatives. The above mentioned analysis of CHAI of five endemic African countries12 identified a broad range of options for domestic innovative financing mechanisms for malaria prevention, control and elimination, from airport taxes, taxes on harmful products, incentives to private donations, prize-linked savings, community health insurance schemes, health trust funds, pooled commodity procurement, "net purchase sweepstakes" and other mechanisms to ensure sustainable financing of malaria interventions. For Asia, in the context of its participation in the work of the RBM Resource Mobilization Sub-Committee, China has asserted that it is gradually shifting to a position to be able to finance the malaria response domestically. For India and Indonesia, a similar approach could lead to significantly decreasing the 2012-2015 GMAP funding gap. This would require a commitment from the three countries for average annual investments in the order of US$1.9 billion for India, US$163 million for Indonesia and US$100 million for China. 4.2 Multilateral funding mechanisms: Global Fund, World Bank and Regional Banks Global Fund to fight AIDS, Tuberculosis and Malaria The Global Fund has been so far a major external financier for the GMAP, having contributed 76% of total aid for malaria since 2002, and 65% in 200913. Around 28% of the resources raised by the Global Fund during its history has gone to malaria prevention, control and elimination, a proportion that has consolidated over the years (it is now at around 34%), thanks to an increasing success of malaria proposals reviewed by the Technical Review Panel. At the Global Fund Replenishment Conference in New York in October 2010, US$11.7 billion were recorded as pledges and projections for the period 2011-2013. The projections amounted to US$2.5 billion relative to discussions that were ongoing with traditional donors not in a position to pledge at the time, as well as new private sector donors and potential income from innovative financing initiatives. Following reports about some implementing countries’ mismanagement of the resources received, the Global Fund is now making efforts to reinvigorate the confidence of its donors, and some of them have already confirmed their support. It is nevertheless still unclear at this point in time if all the pledges made in New York, not to mention the projections, will fully materialize. The outcomes of the 2010 pledging conference and the subsequent estimates and discussions seem to suggest that the Global Fund may have in the future to rely on a more limited range of core donors. In part to counteract the constrained ability to contribute among some of its traditional donors, the Global Fund has embarked on an expanded effort to increase fundraising from both public and private sources in emerging economies, with success in Russia already during the Replenishment and potential opportunities among corporations in Latin America and India. When the Global Fund Board decided to launch Round 11 only in August 2011, proposals would have been considered for approval at the earliest at the Global Fund Board Meeting in May 2012. However, in light of funding uncertainties, the Global Fund’s 24

th Board Meeting in September 2011 decided to

delay the closing date for Round 11 proposals until at least 1st March 2012, thus further pushing back

the approval date until end 2012. Based on analysis by the Global Fund of the status of pledges and contributions, and even assuming pledges would be contributed in full, projections as of 8 November 2011 indicate that by the end of 2013 there may not be any uncommitted assets against which to sign new grants (i.e. under Round 11) or even a slight shortfall. A Board Working Group on Round 11 has been established to look at measures to ensure that sufficient funds can be made available to approve Round 11 albeit of smaller size. In the uncertain environment and the severe fiscal strain, most, if not all, public sector donors that are operating under the Working Group felt that it would be prudent to provide the Board with a risk-adjusted projection of uncommitted assets available for grant signing by the end of 2013. This number that will be shared with the Global Fund’s Board shortly is likely to project a substantial shortfall. The Working Group will provide recommendations to the Global Fund’s 25

th

Board Meeting in November 2011 on sufficient measures to cover this potential shortfall and still fund a Round 11 possibly of US$500 million or more. The projections are not fixed and will become clearer after the Global Fund’s 25

th Board Meeting. Nonetheless, they remain projections and subject to

possible revisions both up and down.

12

Maintaining the Gains in Global Malaria Control, Clinton Health Access Initiative (in partnership with the Evidence to Policy Initiative of the Global Health Group at the University of California San Francisco, and the African Leaders Malaria Alliance), 2011 13

Global Fund to Fight AIDS, Tuberculosis and Malaria, “Making a Difference. Global Fund Results Report 2011”.

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As far as the timeframe is concerned, Round 12 approvals are likely to be pushed back, probably to 2014. Disbursements would therefore be expected to materialize at the end of 2013 for Round 11 at the earliest and only in 2015 for Round 12. The change in the architecture of Global Fund’s financing, which is part of the ongoing development of the new Global Fund Strategy, may change the way in which resources are provided to countries (with an expected decrease in importance of annual rounds and increased reliance on single stream funding, based on national planning cycles). The Global Fund’s Board at its 24

th Meeting instructed the Secretariat to bring forward some of the foreseen

measures in the new strategy and to apply them already in Round 11, such as a more interactive proposal development and greater strategic focus in the types of interventions and expenditure supported by grants. World Bank In 2005, the World Bank launched the Booster Program for Malaria in Africa, a 10-year program designed to help African nations meet the malaria control targets to which they agreed in Abuja in 2000. During its first three years (2005–2008), the Malaria Booster Program committed over US$465 million to the continent. In 2008, the World Bank launched Phase II (2008–2011) of its Booster Program and committed to an expansion of US$1.1 billion. US$300 million have so far been already engaged, thus leaving a substantial balance still due from the 2008 commitments. In addition to the Booster Program, countries can access resources from the World Bank’s International Development Association, which provides both grants and concessional loans at 0 interest, 40 year maturity and 10 year grace period for payback. The 16

th IDA Replenishment can count

on just under US$50 billion, all needs included, for July 2011-June 2014. The 17th IDA Replenishment

can also impact on the final stage of this resource mobilization strategy, as it will apply from July 2014. Borrowing governments have shown over the past years an increasing preference for infrastructure, in the context of the IDA Replenishments. However, the return on investment in malaria is significant enough for this to be reconsidered. Regional Banks Due to the regional configuration of the GMAP resource needs, as illustrated in the chapter 3, the role of the regional development banks is potentially important in contributing to filling the funding gap 2012-2015. However, the information on the regional development banks' investments is scattered. Among the most relevant initiatives:

� African Development Bank: the main reference is still the 2002 Malaria Strategy, which, aiming at the 2010 RBM targets, committed the Bank to co-financing national and regional malaria programmes directly or as part of an integrated approach for communicable disease control. The most relevant funding commitment from the Bank was, in 2006, a five-year project with the Southern African Development Community (SADC) for the control of communicable diseases, including malaria, for 20 million Units of Accounts (equivalent to US$29 million). The project was funded through grant resources from the Bank’s allocation of financing for multinational operations, and is being implemented within the framework of the Cooperation Agreement with SADC.

� The Asian Development Bank launched in 2005 a project of US$30 million over 4 years as

part of the Greater Mekong Subregion Program, to contain the spread of epidemic diseases at local level and reduce the burden of common endemic diseases, including malaria, in Cambodia, the Lao People's Democratic Republic and Viet Nam. The project was matched with funding from WHO and with domestic funding from the three countries. In 2010, the project was extended for 5 more years with additional US$10 million from the Bank and funding for technical assistance from the Poverty Reduction Cooperation Fund.

� Inter-American Development Bank: a regional protocol for technical cooperation was

established in 2010 with the Ibero-American Organization for Social Security for regional epidemiological surveillance in border areas, also including malaria, mobilizing US$1 million from the IDB Ordinary Capital for four years. Most recently, the Bank has joined forces with the Mexican Carlos Slim Foundation, the Bill and Melinda Gates Foundation and the Government of Spain, which donated US$150 million for a Mesoamerica Health Initiative, including a well profiled malaria component, administered by the Bank.

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� The Islamic Development Bank is among the most active regional banks on malaria. Its Vision 1440H (2020, in the Hijri calendar) identified in 2006, as a key strategic thrust, the need to address “the most severe and debilitating threats to health in the Muslim world. These are child mortality, maternal health, diseases including HIV/AIDS and malaria, and environmental sustainability (access to safe drinking water and sanitation)”. A special fund for reducing poverty in member countries was established, with the objective of, inter alia, eradicating major communicable diseases including malaria. In 2005 the Bank established a Quick-Win Malaria Program aiming at combating malaria in 10 highly endemic member countries (Burkina Faso, Chad, the Gambia, Guinea-Bissau, Indonesia, Mali, Mauritania, Niger, Senegal and Sudan), which is still in operation. The program was launched with an approval of US$50 million for the initial phase (which was intended to last two years).

Potential for increase The Global Fund's financing capacity over the next few years is of concern and will require the full attention of the RBM Partners. As of today, Global Fund's resources are likely to be in the near future far less than in prior rounds and also, importantly for the GMAP targets, these funds may not be available until very late into the timeframe of implementation of this strategy. The Global Fund projections are by their nature subject to uncertainty and the change from a twelve-month to the three-year timeframe of the replenishment cycle adds to the potential volatility. This strategy tries to mitigate this uncertainty by focusing on additional funding options. There is however a great deal of potential in exploring with the Global Fund options for reallocating and re-programming existing funding based on prioritization of needs. Frontloading options were already proposed and acknowledged by the Global Fund Board at its 17

th Meeting in 2008, when a paper was

presented on the Global Fund’s role as a "strategic and responsible investor in malaria" to promote accelerated support for the 2010 RBM targets. In fact, resources for approved Global Fund's grants can be “frontloaded,” and such possibility seems to have been used with successful outcomes in Ethiopia and have prevented waste of resources, e.g. for multiple tenders for procurements resulting in delays in implementation. Frontloading Global Fund resources would contribute to support the fundraising effort for the 2012-2015 funding gap. Another supportive action for this resource mobilization strategy would be for the Global Fund to take measures to speed up the process for signature and disbursement, when guarantees of good management by principal recipients can be provided. A key pre-requisite in the fundraising effort with the Global Fund for the years ahead is obviously, at the same time, to continue to strive for cost efficiency and effectiveness in proposal preparation and in grant implementation. It is most likely that in the future World Bank funding for malaria will increasingly materialize by closely integrating malaria activities in health system strengthening and maternal and child health interventions. This may open new funding avenues. In the meanwhile, the World Bank IDA and its preferential credit facility can represent a key, synergistic funding source for the health MDGs and the GMAP. The option is under discussion to encourage Ministers of Finance in high-burden countries in Africa to submit to the World Bank requests for IDA loans from the 16

th and 17

th Replenishments for health investments

under which to prioritize malaria. Ministers of Health should support and help argument this request. This “frontloading” process through loans could contribute substantially to filling the 2012-2015 funding needs. In this option, it could be also envisaged that other major donors propose matching deals with high-burden countries around co-financing with IDA, including additional frontloading mechanisms. As far as the regional development banks are concerned, there seem to be a significant unmet potential, particularly taking into account that malaria appears as one of the regional banks’ priority areas of intervention in health, that the resources invested so far are well below the potential and that the possibility of frontloading grants and loans could also be pursued with regional banks. Synergies with the World Bank and other co-investors could usefully be promoted. 4.3 OECD/DAC donor governments The context The Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD), which gathers the 25 traditional donor governments and the European Commission, has reported official development assistance (ODA) flows for US$128.7 billion in 2010, still representing an increase of 6.5 % over 2009. Net ODA as a share of gross national income (GNI)

19

was on average 0.32% (thus with additional room for reaching the 0.7% by 2015 to which the OECD/DAC governments committed through the Monterrey Consensus in 2002). The forms of aid that increased more substantially over the last year were bilateral aid, debt relief and bilateral lending. Bilateral aid, including debt relief, rose by 5.9% over 2009. Bilateral ODA to Africa and to sub-Saharan Africa increased of 3.6% and 6.4% respectively. The largest aid providers by volume were the United States, the United Kingdom, France, Germany and Japan. The largest increases in real terms were recorded by Australia, Belgium, Canada, Japan, South Korea, Portugal and the United Kingdom. Decrease in aid was recorded for Greece, Ireland, Italy, New Zealand, Spain and Sweden. Denmark, Luxembourg, the Netherlands, Norway and Sweden continued to exceed the ODA/GNI target of 0.7%. The OECD-DAC Secretariat predicted in 2011 a slower but continued aid growth ahead. Programmable aid is forecasted to grow at a rate of 2% per year from 2011 to 2013. For bilateral aid only, the projected increase is 1.3% per year. The slowing down is forecasted to be more marked for support to low income countries and for Africa, where aid is projected to increase at about 1% per year in real terms, compared to a 13% annual growth rate in the past three years. The likely scenario is for an increase of aid at a pace that would be too slow to follow the pace of population growth in developing countries, particularly in Africa. Malaria Funding The G8 (G7 + Russia) committed in 2005 to contribute an additional US$1.5 billion per year to malaria, but this has yet to materialize. However, some members have substantially increased their political and financial commitment to the fight against malaria. Combining funding provided bilaterally and multilaterally (limited for this analysis to the malaria proportion of contributions to the Global Fund), and including for research and development, in 2009 the G7 donors committed to malaria prevention, control and elimination a proportion of their ODA ranging from some 0.7% to the outstanding 2.8% of the United States. Spain is the non-G7 OECD/DAC donor that over the years has invested resources at a level that is comparable to that of the core G7 donors, including with budgets dedicated to funding research and development. Among the most interesting, current commitments to the fight against malaria from OECD/DAC Member States: United States: The 2008 Lantos/Hyde Act authorized up to US$5 billion funding for malaria prevention and control for the period 2009-2013. The Act, which forms an integral part of the 2009 US Government’s Global Health Initiative (a six-year, US$63 billion commitment to global health), has inspired a comprehensive 2009-2014 Malaria Strategy that builds up on the President’s Malaria Initiative 2005-2010 and also includes substantial funding for research. United Kingdom: In December 2010, the British Prime Minister confirmed that tackling malaria was a top priority for the UK Government, and the Secretary of State for International Development has recently promised an investment of up to £500 million annually by 2014/2015 in the UK Framework for Results (equivalent to some US$800 million at the time of the pledge). The UK geographical priorities in aid for malaria include all the endemic countries with the highest disease burden. The UK is also committed to increasing the proportion of its budget for research. The European Commission has launched a new MDG Initiative amounting to US$1.32 billion to support national plans in African, Caribbean and Pacific (ACP) countries and help them make progress on the MDGs, with a focus on MDGs 4 and 5. The Commission has also pledged US$1.42 billion for 2011-2013 for maternal and child health under the Muskoka Initiative. So far, the most relevant funding area in malaria, in addition to the contribution to the Global Fund, has been research and development. At the 2010 G20 Summit in Seoul, Japan reiterated its commitment to provide US$5 billion in support of the health MDGs over five years from 2011. Malaria initiatives in endemic countries are supported through grant aid and technical cooperation projects with integrated services for health system strengthening and maternal and child health. South Korea has decided to more then double its ODA/GNI ratio, from 0.1% in 2009 to 0.25% by 2015. The Korean International Cooperation Agency has identified health as a priority sector, with a focus on MDGs 4, 5 and 6. South Korea has a number of ongoing projects in the health area, especially in the

20

context of the Association of Southeast Asian Nations (ASEAN), but it is also increasingly investing in Africa, including in the prevention of malaria and in water and sanitation projects. Potential for increase An analysis of the proportion of aid that the different OECD/DAC donors devote to malaria, either bilaterally or multilaterally, shows considerable differences between members, despite the fact that the fight against malaria is a key, common UN and OECD/DAC development goal. In fact, if all the OECD/DAC members allocated to malaria prevention, control and elimination some 2% of their aid budgets, bringing their investments closer to the proportional investment of the US, this would generate an annual revenue of some US$2.6 billion for malaria, against current investments of some US$1.5 billion (see annex IIa). While this simulation is merely illustrative, it gives an indication of the monetary value that a strong political commitment from OECD/DAC members can bring in and the type of burden sharing/peer emulation that could be advocated for, particularly but not exclusively, among the G7. The outstanding effort of the UK will bring significant new resources over the next few years and will position the UK as the European OECD/DAC champion in the global fight against malaria. To identify strategically additional donors, the following parameters could be proposed: a) donor financial capacity and relatively healthy financial record, b) commitment to ODA targets, and c) expressed interest in malaria over the last five years. Based on these criteria, a rapid review points to at least three OECD/DAC members that it may be advisable to work with in the short term: Australia, Norway and South Korea. These three donors have already contributed bilaterally and multilaterally to malaria prevention, control and elimination (Australia has been a major funder for malaria research over the past few years), are still vocal in their effort to continue to aim to the 0.7% ODA target (Norway has in fact been exceeding it for years), and they also have the distinctive advantage of having recorded in 2010 a relatively lower central government debt as a proportion of their GDP (less than 35%). Most of the EU Member States seem to be less well positioned, within the current context of their economic and financial vulnerability, to be able to provide any short term increase in their contribution to filling the GMAP funding gap 2012-2015. However, the European Union, as mentioned above, has pledged through the European Commission considerable new resources to be deployed for the achievement of the MDGs, in consultation with the ACP countries, which could contribute significantly to supporting the GMAP fundraising agenda for 2012-2015. 4.4 Aid from emerging economies Some governments in non OECD/DAC countries are already funding the GMAP, but with significant potential to become more important, if not leading, actors in the fight against malaria, due to their economic growth and positioning in the global development agenda. This could be done, in some cases synergistically, through domestic commitments (for those of these countries that are also malaria endemic) as well as public sector and private sector aid. This section will address their role as public sector aid investors, while section 4.1 has reviewed their public sector’s domestic investments and section 4.5 will examine the potential role of their private sector. The G20 committed in the 2010 Seoul Development Consensus on Shared Growth to assist developing countries, particularly low-income countries, in achieving the MDGs, including through south-south and triangular cooperation. According to the World Malaria Report, the G20 countries that are not members of OECD/DAC (Argentina, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa and Turkey) all had populations at risk of malaria in 2009. India, Indonesia and Brazil in particular are among the 50 countries with the highest number of cases (India is number 2). An analysis commissioned by the Resource Mobilization Sub-Committee shows that, among the new emerging economies, Brazil, Russia, India and China (BRIC) are probably the foreign aid providers of most relevant potential for supporting the GMAP. The level of aid provided by the BRIC is difficult to assess in detail but it is undoubtedly on the rise and, at least for China, India and Russia, it seem already now quite substantial. These countries have clearly expressed geopolitical interest in a number of malaria endemic countries with funding gaps. Brazil, China, India and Russia have already contributed resources to international GMAP efforts (regionally and/or in Africa). Based on the analysis performed by the RBM Resource Mobilization Sub-Committee, it seems that China and Russia contribute a significant 1.3-1.6% of their estimated aid budget to malaria. BRIC countries (with the exception of Russia) clearly prefer bilateral south-south cooperation approaches, or, in some cases,

21

trilateral deals with multilateral organizations, regional development banks or traditional OECD/DAC donors (some of them, such as the UK and the US, are committed RBM Partners)14. Brazil has demonstrated a growing interest in technical cooperation around malaria, having supported in recent years small projects, mainly in Portuguese speaking African countries. In addition to leading the malaria agenda in the IBSA (India-Brazil-South Africa) Forum, Brazil is an active member of the Community of Portuguese Speaking Countries, headquartered in Lisbon, which also include two high-cost endemic countries in Africa: Angola and Mozambique. Brazil is the 7

th largest governmental donor

for the global research and development agenda. The Russian Federation has so far prioritized multilateral funding and less tied forms of aid. Russia has provided contributions to WHO and co-financed IDA operations on malaria, including US$15 million in 2008-2010 under the World Bank Malaria Booster Program in Zambia and Mozambique and US$4 million to WHO to support malaria interventions in Africa and the Middle East. For 2011-2014 Russia has launched a capacity building project (with over US$4.5 million funding) to be implemented in collaboration with WHO and with a main focus on malaria elimination in Africa and in the Commonwealth of Independent States. India is interested in increasing its development assistance to Africa. The first India-Africa Forum Summit, in 2008, led to a Declaration, a Framework for Cooperation and a Plan of Action that entailed a commitment by India to provide US$500 million in development assistance to Africa and included health as an area for cooperation, mentioning malaria. In 2011, India declared that it would offer US$5 billion in credit to African countries for the next three years to help them meet their development targets. India is currently the 6

th largest governmental donors for malaria research and development.

China has singled out malaria as one of the priority areas of its foreign aid effort in the health sector, particularly in the “Beijing Action Plan (2007-2009)” and in the subsequent “Sharm El Sheikh Action Plan (2010-2012) of the Forum on China-Africa Cooperation. The Sharm El Sheikh Action Plan, following up on a previous commitment for some US$38 million, included a new pledge to “provide RMB500 million Yuan [US$73.3 million] worth of medical equipment and malaria-fighting materials to 30 hospitals and 30 malaria prevention and treatment centers built by China for Africa in the coming three years”, as well as a exchange programs in the area of malaria. News accounts have highlighted China’s efforts on malaria in high-burden countries in Africa, such as in Tanzania and Uganda. Potential for increase There is undoubtedly potential for increase in the BRIC contribution to the 2012-2015 needs, as in terms of economic growth all these countries continue to have a high GDP growth, ranging between 3-4% (Russia) to more than 10% (China and India). In terms of foreign aid, if all the BRICS governments contributed to a level of funding amounting to some 4% of their aid budgets), this effort could bring to some US$130 million per year, as opposed to the current US$50 million (using aid budget estimates on the higher side this amount could be as high as US$180 million) (see annex IIIa). In addition: Turkey, without having shown so far a marked interested in malaria, is nevertheless worth following closely because of its dramatic increase in foreign aid over the past few years, and because it is an influential member of the Organization of the Islamic Cooperation (which includes high-burden countries such as Bangladesh, Indonesia, Nigeria, Sudan and Uganda). For the same reason, Saudi Arabia and other oil-rich Middle East countries are also of major interest (the RBM Partnership already receives support from the Abu Dhabi Government). However, as the main potential in these countries is from foundations, it will be addressed in section 4.5 on foundations and private philanthropy.

14

Both multilateral organizations and bilateral donors such as the European Commission, Japan, the UK and the US have recently engaged in discussions and negotiations, in particular with China, about reaching trilateral cooperation agreements with African countries. With some exceptions (e.g. a widely quoted DFID-funded malaria project in Angola that would have benefitted by Chinese expertise), these agreements have so far been quite complex, politically sensitive and of limited success However, US aid programs on malaria have been considered as a potential area for US-China cooperation. The potential benefit of trilateral cooperation in supporting regional approaches of broader development scope has been acknowledged by US diplomats, with the recommendation to focus this approach on projects that “have broad support within the African community, preferably African-initiated and led” (Wikileaks: “US-China development cooperation in Africa”, 07 December 2010)

22

Venezuela, though not a G20 country, is an oil exporting country affected by malaria, and its active role in the context of the cooperation framework of the Amazon Countries Community could position it well to support with Brazil the funding effort to meet the GMAP needs in the region. 4.5 Philanthropy and private sector’s social investment Philanthropy and social investments in traditional donor countries Philanthropic funding for the global fight against malaria is led by the Bill and Melinda Gates Foundation, which committed US$1.7 billion in grants between 2004 and 2010, with a major focus on advocacy and research and development. Other important RBM Partners in the philanthropic area have been the UN Foundation and the Clinton Foundation. The UN Foundation’s flagship initiatives have been the Nothing But Nets campaign (having raised more than US$35 million) and the UN Foundation - United Methodist Church and Lutheran World Relief campaign aimed to raise US$200 million for the malaria cause (to be channeled through the Global Fund and faith-based organizations). The Clinton Foundation directs financial resources to the implementation of its own programs on the ground, notably, on malaria, through the Clinton Health Access Initiative, currently focusing on negotiating prices of malaria drugs and analyzing and designing resource mobilization approaches for malaria elimination. Among the top 15 US foundations providing resources for global development, a few have committed funding to malaria projects, such as the Ford Foundation, mainly to assist organizations supporting Global Fund’s grants, and the Rockefeller Foundation, which has contributed significantly to support the malaria research agenda. Outside the US, the major foundations involved in malaria support have been, as a funder/implementer, the Geneva-based Aga Khan Foundation, as well as, as funders, the UK Welcome Trust, which has substantially funded research on tropical diseases, including malaria, and the Portuguese Calouste Gulbenkian Foundation, which has supported the fight against major epidemics and health system strengthening in Lusophone Africa and East Timor15

. The corporate sector plays an important role in supporting the GMAP through direct cash contributions to research and developments and, to a lesser extent, projects, co-investments in affected communities, price reduction of commodities, in-kind donations and pro-bono services to organizations involved in the fight against malaria. Among the corporate actors involved in the fight against malaria in social responsibility and social investment activities, the Private Sector Constituency on the RBM Board counts some 20 companies. Major contributors to the malaria agenda have been made by companies, or corporate foundations, from the extractive and pharmaceutical industries as well as from producers of malaria commodities. Philanthropy and social investments in emerging economies In emerging economies, philanthropy is growing, but it is still mainly focused on domestic causes. A notable exception is the Carlos Slim Foundation in Mexico, which has a broad regional focus and has recently launched, together with the Gates Foundation, the Government of Spain and the Inter-American Development Bank, the Mesoamerica Health 2015 Initiative, funded with US$150 million, aiming to reduce the gap in access to health faced by the poorest 20% of the population living in Central America and Southern Mexico, and also including activities for the control of malaria. In other countries: Brazil has a long history of private philanthropy, in some cases linked to the Catholic Church. Estimates of the amounts donated each year range from US$3.9 to US$4.7 billion. The bulk of this comes from local and multinational corporations. A specific interest in funding the fight against communicable diseases has been expressed by the Fundação Vale, which is the philanthropic arm of the Vale Group (Brazilian mining company that is a member of the Global Business Coalition on HIV/AIDS, Tuberculosis and Malaria). Over the last three years, Vale invested US$725 million in social projects.

15

Malaria has also been a recurrent theme for the work of fraternal organizations, such as the Rotary, Kiwanis and Lions Clubs. In addition, some relatively small foundations have also provided significant support, such as the UK Comic Relief, which has granted £6.3 million to the Global Fund and the Malaria Consortium for the distribution of bed nets, health services and malaria education programs in Africa.

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Brazil has also a large number of wealthy individuals: with nearly 150,000 high net-worth individuals (HNWIs), it ranks second to China among the BRICS group of emerging economies (Brazil, Russia, India, China, South Africa). “Ultra-high net-worth individuals” (those with financial assets in excess of US$30 million) account for 87% of the total HNWI wealth. Among the 100 richest people in the world, Forbes lists some Brazilian philanthropists who have been engaged in child development activities, such as Joseph Safra or the family Moreira Salles. Philanthropic giving in China has been reported as growing, but with a focus on domestic needs. This has been linked to the Chinese system of guanxi, or personal connections, which emphasizes personalized networks of influence in social relations and philanthropy. Some organizations already gather Chinese business around charity causes. However, the overall weight of private philanthropy in China is still modest, and many donations seem to come from the Chinese units of large multinational companies. An important development is obviously the emergence of private wealth in the country, as China records the highest number of HNWIs among the BRICS (480,000 HNWIs), and the fourth largest worldwide. A regularly published source of data on philanthropy among Chinese HNWIs is the Hurun Philanthropy Report. According to the 2011 Report, the top 100 Chinese philanthropists have donated individually some US$18.5 million annually on average. At least ten of them have expressed publicly an interest in philanthropic giving to social welfare and health causes. About half of them have now their own personal foundation, and some of them fund child welfare projects (e.g. the BYD Charity Foundation, the Yu Pengnian Foundation). The Li Ka Shing Foundation in Hong Kong has also funded projects on malaria. In addition, it seems that Diaspora philanthropy is also on the rise, so far providing support mainly to Chinese organizations for the development, social welfare and education of the people in connected clans and counties. Private philanthropy in India has traditionally been guided by religion and caste, clan, family and community demand, but, more recently, also by the development of a more modern corporate social responsibility culture. Reliable estimates of the amounts donated each year are not available for recent years, with figures as high as US$5 billion mentioned (2006). Philanthropy in India has been characterized as typically inward-looking, focused on domestic needs (mainly education, but also health) and not much prone to be reported publicly.

India has a relatively large number of wealthy citizens: 130,000 are HNWI, with a considerable proportional increase in their number (+51%) between 2008 and 2009. Forbes currently lists 7 persons among the 100 richest people in the world. Among them, there are personalities such as Mukesh Ambani (who supports with his wife two Indian foundations linked to his corporate group, the Reliance Foundation and the Dhirubhai Ambani Foundation, focusing on occupational health as well as community health care, and including malaria), or the industrialist Gautam Adani, whose wife leads the Adani Foundation, which implements, inter alia, activities against malaria in India.

Another significant potential could be found in the Indian corporate sector, although, at first glance, malaria does not seem to have featured prominently in Indian corporate social responsibility activities, certainly much less than HIV/AIDS. However, there are examples of interest, such as Tata Iron and Steel, one of India's largest conglomerates, has sponsored numerous community health programmes in India in the areas of direct relevance to malaria, such as human capital, mother and child health, water and sanitation.

Other philanthropic sources with known potential are the international oriented foundations from oil exporting countries in the Middle East. The most advanced philanthropic markets for this type of foundations, virtually all supported by royal families and their networks, are in Jordan, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates. In addition to regional support, these foundations could be targeted for their potential to be interested in supporting, more broadly, cost-driving malaria endemic countries that are members of the Organization of Islamic Cooperation. Last but not least, there are developments in philanthropic giving in Africa. The Gift from Africa Campaign, which was announced at the MDG Summit in September 2010 and launched in Africa, with initial pledges of US$3 million, was supported by the TY Danjuma Foundation, together with the United Nations Global Compact, Friends of the Global Fund Africa, and the Global Business Coalition on HIV/AIDS, Tuberculosis and Malaria. This initiative has been able not only to gather support for the Global Fund from the private sector in Africa, but also to engage a new champion from the business sector, the South African philanthropist Precious Moloi-Motsepe.

24

Potential for increase There are ad-hoc examples of many foundations supporting the fight against malaria in traditional donor countries, but their financial commitment cannot at any rate compare with the financial support that has been provided over the years by the Gates Foundation. In perspective, however, it is important to note that at least four out of the 15 major US foundations have as a main thematic priority maternal and child health, and they could therefore be the target of ad hoc fundraising effort aimed to support the scaling up of support to malaria prevention, control and elimination as an effective step to accelerate impact on maternal and child health. All in all, the highest potential for new substantial money from philanthropy in western countries could come from social investment and innovative financing deals, including with venture philanthropy. Some of these organizations, such as the Children's Investment Fund Foundation (CIFF) or the Acumen Fund, have an international portfolio with a direct link to child survival and health, thus with a significant potential to include malaria, and they can become interested in matching their investments with the contributions of other major donors (including the Gates Foundation, as it has been the case for CIFF in supporting the fight against malnutrition). The UNF Pledge Guarantee for Health can offer additional opportunities (see following section). Opportunities for increase seem also to be found in business in endemic countries, particularly in emerging economies from Asia and in Africa, and, more traditionally, in oil exporting countries. If increasing contributions from foundations and other philanthropists in the various regions are pursued, and as funding decisions in the philanthropic area are mainly made based on the influence of networks and connections, a preliminary strategic mapping of the leverage that can be obtained from RBM Partners would be needed to fully exploit the fundraising potential of philanthropy. 4.6 Innovative financing The Resource Mobilization Sub-Committee established an Innovative Financing Task Force, led by the Private Sector constituency, to review a comprehensive list of mechanisms within health, energy, agriculture and development and propose potential new mechanisms that could help fill the funding gap for 2012-2015, develop selection criteria and shortlist the most promising mechanisms. This work was presented to the RBM Board at its 20

th Meeting in May 2011. The Board asked the Task

Force to develop a business plan for the possible implementation of a Malaria Bond, prioritize other proposals and develop business plans for one or maximum two additional proposals between rounding up credit/debit card spending and donations via ATM (possibly merged in one initiative), Diaspora bonds and remittances. Based on further analysis, the Task Force decided to pursue the possibility to include the Diaspora bond within the Malaria Bond concept. It was decided that this would be looked at once the malaria bond was implemented to capitalize on lessons learnt. However, while developing the Business Plan for the Malaria Bond, the Task Force decided to develop concept notes for Diaspora bonds for malaria as well as a bond aimed at implementing malaria activities within the private sector in malaria endemic countries. These two concept papers will be presented to the Board at the 21

st Board Meeting in

November 2011. The Malaria Bond business plan looks at setting up a pilot bond for approximately US$50 million to be implemented before 2015 and gives further thought to how this can be scaled up. However it is clear that the pilot will give extensive learning and proof of concept which will be used to develop this further. UNITAID Brazil, Chile, France, Norway, the United Kingdom and the Bill and Melinda Gates Foundation established UNITAID in 2006 to contribute to scaling up access to treatment for HIV/AIDS, malaria and tuberculosis by leveraging price reductions and accelerating access to drugs and diagnostics. UNITAID derives most of its funding from an air solidarity levy which ranges from US$1 for economy class to a maximum of US$40 for business and first class. Currently, eight countries contribute to UNITAID through the airline tax system and some more through regular ODA contributions or other funding mechanisms.

25

Since its creation, UNITAID has committed US$350 million for provision of malaria drugs and supplies. Malaria projects have represented so far some 26% of the total UNITAID portfolio. As part of the UNITAID Strategy 2010-2012, an ongoing project for forecasting artemisinin and ACT demand and supply will contribute to a decision by the UNITAID Board in 2012 regarding a new call for proposals for innovative approaches to the provision of drugs, including for malaria (and will define future support to the Affordable Medicines Facility for malaria). In the meanwhile, a call for proposals was launched this year to promote the uptake of diagnostic technologies, which should allow opening this channel of funding in mid-2012. UNITAID, which is currently relying on a relatively restricted donor basis, is working on a resource mobilization strategy for the years to come, which, if successful, would provide additional opportunities to finance the 2012-2015 needs for the GMAP as part of the UNITAID support to the fight against the three diseases. Based on an initial landscaping, UNITAID currently sees its most relevant fundraising opportunities in consolidating the engagement of current donors, both through air taxes and ODA contributions, increasing the number of governments implementing the air solidarity levy, with a particular focus on emerging economies, exploring the possibility of involving the business sector in voluntary solidarity contributions linked to air travel (e.g. in China) and possibly accessing funding through other innovative financing mechanisms currently being discussed by the development community, such as a solidarity tobacco levy or the financial transaction/currency transaction taxes. Another area with potential impact on this resource mobilization strategy could come from UNITAID supporting challenge grants for promoting new or improved technologies that can shape the market for malaria products. Debt to Health The Global Fund's Debt to Health mechanism allows creditors and debtors to collaborate through debt conversions to increase funding for Global Fund approved grants. Under a Debt to Health agreement, creditors cancel a portion of their claims on the condition that the beneficiary country invests an agreed counterpart amount in its national health programs through an approved Global Fund grant. The revenue is reported as Global Fund's income. To date, four Debt to Health agreements have been signed. They involve Australia and Germany as creditor countries and Indonesia, Pakistan and Côte d’Ivoire as debtors/beneficiaries. Deals have been concluded for some total US$105 million since 2007, of which some US$32 million could be attributed to malaria grants in the three beneficiary countries. UNF Pledge Guarantee for Health The UN Foundation has established the Pledge Guarantee for Health (PGH), an innovative financing mechanism backed by the Bill and Melinda Gates Foundation. This mechanism provides bridge financing by organizing guarantees through Letters of Credit, so that health supplies can be shipped while the normal processes of transferring donor funding for a particular commodity are worked out. In late 2010, PGH helped the Government of Zambia, the World Bank and UNICEF accelerate delivery of 800,000 malaria bed nets ahead of the rainy season, potentially saving thousands of lives and millions of dollars in the local health system. PGH has therefore added an important frontloading capacity, which broadened the solutions that existed before to increase access for LLINs, namely: (1) for donors, to provide more funding to secure additional supplies and commodities to reach underserved populations; (2) for manufacturers, to lower their prices so that more supplies and commodities could be secured with existing funding. Potential for increase Additional funding could be generated from new ideas and deals with innovative financing mechanisms that have already supported malaria prevention and control targets. The UNF/PGF is a case in point. The PGF is structuring a framework to amortize payments of contraceptive implants across multiple years. There is a potential to do the same for LLINs, by leveraging both Letters of Credit and Supplier Credit through bank guarantees so that donors and endemic countries can provide bridge financing to accelerate delivery of LLINs. Without needing to increase funding for LLINs, PGH enables donors and endemic countries to frontload the delivery of LLINs in order to benefit from more years of protection. Countries are able to avert more deaths for the same funding envelope, sidestepping funding constraints and ultimately enhancing value for donor funding.

26

The establishment of an ad-hoc innovative financing mechanism, such as the malaria bond, fully dedicated to increasing resources for the GMAP 2012-2015 is another promising option, which would challenge the RBM Partnership to strengthen its capacity to manage a relatively complex process which requires investment and sustainable support. A separate analysis is provided to the RBM Board by the RBM Task Force on Innovative Financing. Innovative financing solutions adapted to specific country conditions can also be envisaged to be proposed for adoption to foster domestic investments in emerging economies and other endemic countries with a high malaria burden. For example a proposal to establish some innovative financing options is being considered in Nigeria, with the support of the Friends of the Fund Africa. Other options have been reviewed and presented in a piece of research by CHAI, already mentioned under 4.1. 4.7 Resource mobilization scenarios Based on the analysis of the status and potential of the funding sources described in the preceding sections as well as taking into account the inputs provided by the major donors to the section on financing of the GMAP Implementation Overview, some high-level estimates are presented here of possible levels of fundraising efforts to fill the 2012-2015 funding gap. These estimates are illustrated through scenarios: 1. "Conservative” scenario: the main assumption of this scenario is that the major, current donors will continue to contribute to malaria prevention, control and elimination at current levels or as committed or estimated as of 8 November 2011 (notably the US, the UK, the World Bank and other regional banks, the Global Fund, the Gates Foundation). This scenario assumes that the risk that these donors may decide to reduce contributions from now on is low, but it takes into account the recent uncertainties regarding the Global Fund's potential for providing resources (updated as of 8 November 2011 and subject to further adjustments based on forthcoming discussions at the Global Fund's Board). 2. "Moderate growth” scenario: the assumption underpinning this scenario is for limited additional funding flows that should be possible to mobilize with a relatively modest fundraising effort. These are, namely, materialization of additional commitments of US and UK, current level of malaria aid of other OECD/DAC members, the European Commission and major emerging economies (with a slight increase from them), projected revenue from Global Fund rounds 11 and 12 (as of 8 November 2011), available funding from the World Bank’s Booster Phase II, continuation of current UNITAID support as well as continuation of domestic spending for malaria in endemic countries at the same level as reported in the 2010 WMR. This moderate growth path (which may stop and stabilize at around 2014, if no new sources are added) would not allow meeting the needs by 2015, or even later. If maintained at these levels, funding would be still insufficient to address the needs for the next four years, and the funding gap would remain extremely challenging. Based on the analysis of the current and potential funding sources described in the previous chapters, it is possible to project a more ambitious "accelerated growth" scenario, based on the assumption that a robust and creative fundraising effort by all RBM Partners could result in much more significant increases in domestic investments in emerging economies and in Africa, additional aid from the G7 and other selected OECD/DAC members, more international investment from emerging economies, more funding from philanthropic sources. There is also a larger scope for a range of frontloading options in this model, notably through loans from the World Bank's IDA (thus supporting domestic investments, particularly from Africa) and regional banks, reprogramming opportunities with the Global Fund and the development of bonds dedicated to/including funding for malaria. The figures in this scenario would be at this stage more theoretical than those in the other scenarios and they are therefore not presented here in detail since they are not corroborated with donors and endemic countries. However, the growth path that could characterize this more ambitious scenario is factored in in the graph which follows.

27

Resource

needs

0

1'000'000'000

2'000'000'000

3'000'000'000

4'000'000'000

5'000'000'000

6'000'000'000

7'000'000'000

8'000'000'000

US

$

Conservative scenario

Moderate growth scenario

Projected achievement path

Projected achievement path withfrontloading

Conservative scenario 2'795'000'000 2'775'000'000 2'775'000'000 2'725'000'000

Moderate growth scenario 3'900'000'000 4'240'000'000 4'570'000'000 4'500'000'000

Projected achievement path 3'900'000'000 4'700'000'000 5'600'000'000 6'597'000'000

Projected achievement path

with frontloading

4'500'000'000 4'700'000'000 5'600'000'000 6'597'000'000

Resource needs 6'830'000'000 6'784'000'000 6'698'000'000 6'597'000'000

2012 2013 2014 2015

2012 2013 2014 2015

US ongoing (multi-bilateral)1 585'000'000 585'000'000 585'000'000 585'000'000

UK ongoing ((multi-bilateral

projection)1

130'000'000 130'000'000 150'000'000 150'000'000

UK potential (additional multi-

bilateral)1

120'000'000 320'000'000 650'000'000 650'000'000

Other OECD/DAC ongoing

(bilateral projection)

110'000'000 110'000'000 110'000'000 110'000'000

EC ongoing (projection - R&D) 30'000'000 30'000'000 30'000'000 30'000'000

Emerging economies ongoing

(multi-bilateral projection)1

50'000'000 50'000'000 50'000'000 50'000'000

Emerging economies potential

(additional multi-bilateral)1

10'000'000 20'000'000 20'000'000 50'000'000

GFATM ongoing (projection) 430'000'000 410'000'000 390'000'000 340'000'000

GFATM potential (additional,

lower)

100'000'000 100'000'000 100'000'000

WB ongoing (projection) 50'000'000 50'000'000 50'000'000 50'000'000

WB committed 200'000'000 250'000'000 250'000'000 200'000'000

Regional Banks ongoing

(projection)

30'000'000 30'000'000 30'000'000 30'000'000

BMGF ongoing (projection)1 170'000'000 170'000'000 170'000'000 170'000'000

IF ongoing (projection) 50'000'000 50'000'000 50'000'000 50'000'000

Domestic ongoing (projection) 1'350'000'000 1'350'000'000 1'350'000'000 1'350'000'0001 Excluding commitments to Global Fund for 2011-2013

A 2'795'000'000 2'775'000'000 2'775'000'000 2'725'000'000

B 1'105'000'000 1'465'000'000 1'795'000'000 1'775'000'000

C 3'900'000'000 4'240'000'000 4'570'000'000 4'500'000'000

Based on bilateral aid 2009 (OECD/DAC) + R&D 2009 (Path)

Comments

Continuation of expected 2012 funding

GMAP IO

GMAP IO + Framework for Results

Moderate growth (A+B)

WMR 2010 based on 2009 expenditures

Conservative=expected

GMAP IO

26% of UNITAID tax component (2010 budget)

Projected funding flow by funding source (as of 8 November 2011, in US$)

Easier to reach funding level

GMAP IO

GMAP IO: Booster Phase II

Past programmes

GMAP IO

40% of round 11 and 12 (at 0.5 billion) - only phases 1 expected by 2015

Estimated continuation 2009 support incl. research

2009 contribution to R&D

Assuming BRIC increase to reach burden sharing - average estimate of aid

levels

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5. Resource mobilization strategy overview The GMAP needs overall funding support to meet its needs for 2012-2015. A summary of strategic fundraising streams (with some of them interacting and/or overlapping) is proposed below, together with a range of related strategic actions that derive from the analysis of the current and potential funding sources performed in the previous chapters. A. Mobilize growing domestic public sector funding There is ample justification for high-burden African and Asian countries to continue to make investment in malaria prevention and control, in view of the high economic return and, for the African countries, also to incrementally align their investments to the commitments they made in Abuja on increasing health investments. This resource mobilization strategy recommends that:

A.1 Encourage African and Asian endemic countries to engage to progress towards more ambitious domestic funding targets. Options would include accessing loans from the IDA (see sections 4.1 and 4.2) as well as increased private sector investment in malaria, in particular for those countries that are experiencing an economic growth. Inter-governmental processes, such as in the context of the Africa Union, ASEAN and regional economic communities in Africa and Asia would be essential to advocate for the need for strong political leadership to drive this process.

A.2 Work with robust emerging economies such as Brazil, China, India and Indonesia, to maintain and increase domestic spending for adequately cover their own needs. If these countries cover as much as possible of their cost share in the GMAP, this would allow the fundraising effort of the RBM Partnership to concentrate on poor countries with the greatest needs. In this context, it should be noted that the Ministers of Health of the BRICS group of countries issued the Beijing Declaration in July 2011, which institutionalizes the dialogue among the Ministries and the Geneva Permanent Missions around health priorities. Challenges and opportunities for domestic engagement in malaria prevention, control and elimination as well as synergies with other health areas, such as health system strengthening, could be promoted as a core part of this agenda. B. Maintain and expand the funding basis from traditional donors Even if development assistance from OECD/DAC governments was not to increase significantly in the next few years, they need to remain a key funding source for the GMAP. Resource mobilization activities aiming at maximizing contributions from these traditional donors will therefore continue to remain central to the 2012-2015 GMAP fundraising effort. This strategy will need to be adjusted regularly to take into account the evolving challenges and opportunities with them.

B.1 Maintain G7 leadership in funding the next phase of the GMAP implementation: seize the opportunity that the next two G8 Summits will be hosted by supportive governments (US, UK) to continue to support the Global Fund’s fundraising effort and profile malaria prevention, control and elimination and its value for money in the development financing agenda of the G7 and the urgency of scaling up investments as the last opportunity to impact on the 2015 targets, including on maternal and child health.

B.2 Build convincingly the case for GMAP support and links to the maternal and child health agenda with a selected group of other OECD/DAC governments having the potential to become more relevant bilateral and multilateral donors for malaria. This should be done through tailor-made strategies for each donor including high-level consultations led by the best positioned RBM Partners with decision makers of these governments in both capitals and embassies in endemic countries, as well as through advocacy and communication activities aiming at creating conducive environments with the media, the parliaments and the public. Section 4.3 has highlighted possible immediate targets and approaches.

B.3 Work with the European Commission to tap into the new EC/ACP resources for the achievement of the MDGs and maternal and child health, while preparing dialogue with the Commission on the Multiannual Financial Framework 2014-2020. This would include particularly establishing a timely dialogue with the EC Directorate General for Development and Cooperation/Europeaid and the Directorate General for Research. C. Increase aid from emerging economies

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This resource mobilization strategy proposes an increase in the emerging economies’ support to the GMAP for 2012-2015 through a variety of means, including, for emerging economies that are also high-cost countries in the GMAP, domestic funding from the public and private sector (see strategic streams A.2 and F.2). In addition, emerging economies can become leading international donors for malaria prevention, control and elimination. This strategy suggests focusing on a few strategic emerging donors:

C.1 Establish dialogue with aid decision makers in emerging economies such as Brazil, India and China on ongoing and potential support to countries/regions of geo-political priority that are high burden countries with funding gaps (including increased investments in malaria in the agendas of the ASEAN, China/Africa and India/Africa cooperation fora, the Amazon Cooperation Treaty Organization, the Community of Portuguese Language Countries). C.2 Recruit at least one champion from emerging economies for profiling malaria financing in the G20 development agenda emerging from the Seoul Development Consensus for Shared Growth. C.3 Profile malaria funding in ongoing discussions of trilateral development agreements between emerging economies, OECD-DAC/regional development banks/multilateral donors and third countries.

C.4 Explore interest in malaria funding from other emerging donors that are increasing substantially their aid package, such as Turkey (e.g. in support to needs in endemic countries that are members of the Organization of Islamic Cooperation). C.5 Retain funding commitment from Russia, and mobilize Russia’s political support for positioning malaria in the G8 development discussions. D. Frontload resources to accelerate impact of domestic investments and aid Frontloading has the potential to be an extremely important tool to fundraise for the 2012-2015 needs, since it would allow accelerated investment, which would show results by 2015 (see section 4.2). At the same time, frontloading through loans (e.g. by the World Bank or regional banks) would encourage domestic investments and contribute to fulfilling the international commitments on health spending. Finally, in the hope that the financial vulnerability of the OECD/DAC members is a relatively short term liquidity crisis, frontloading resources would help bridge the urgent financial shortfall of the GMAP and allow the aid budgets of traditional donor countries to recover and resume their support for malaria prevention, control and elimination. A few proposals are put forwards in this strategy focusing on the possibility to frontload funding that would otherwise only become available after 2015 (in addition to the establishment of a "malaria bond", which is reviewed in the section E. below): D.1 Take forward discussions with the World Bank and African Ministers of Finance on options for IDA loans, with a focus on the 16

th and 17

th Replenishments.

D.2 Explore reprogramming options with the Global Fund to maximize Global Fund’s resources for the GMAP for the 2012-2015 period, including in the context of the current reprioritization process. D.3 Pursue opportunities with regional banks, along with the discussion with the World Bank, to support substantial scaling up of funding for regional GMAP needs and synergistic results with other health objectives, e.g. through matching mechanisms and incentives for regional cooperation.

E. Apply innovative financing solutions Innovative financing is playing an important role in funding health and development, including malaria prevention, control and elimination. It is recommended to continue exploring innovative mechanisms such as those undertaken by UNITAID and also identify other possible avenues for funding, based on criteria of comparative advantage, additionality, predictability and sustainability. Innovative financing options have been described in various parts of this strategy and have already been mentioned in the previous sections. The most relevant proposals are grouped as follows: E.1 Create a dedicated innovative financing mechanism in support of the 2012-2015 needs, e.g. in the form of a malaria bond.

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E.2 Support UNITAID in ongoing fundraising efforts to bring in new countries adopting air taxes and voluntary air-travel related contribution schemes, while maximizing the opportunities for malaria that are being offered by the 2011-2012 UNITAID calls for proposals on diagnostics and drug procurement and, potentially, a challenge grant for new LLIN technology. E.3 Further explore use of remittances and Diaspora bonds to increase domestic resources for malaria prevention, control and elimination. E.4 Explore options for additional debt conversion deals (within and outside the Global Fund Debt to Health mechanism) in support of the GMAP. E.5 Expand use of the UN Foundation Pledge Guarantee for Health. F. Encourage sustained private sector and philanthropic support Increased contributions from foundations and other philanthropists in both traditional and non traditional donor countries as well as for domestic needs could be pursued through various means: F.1 Outreach to private sector actors in endemic countries in Africa to identify opportunities for corporate engagement in support of domestic malaria prevention, control and elimination needs. An advocacy/fundraising event with the African private sector is planned on the occasion of the 2012 World Malaria Day in Tanzania. The initial fundraising target is US$10 million. Based on the success of this event, and some landscaping analysis, a broader and more stable partnership for supporting the 2012-2015 needs could be established with leading private sector champions in Africa. F.2 Engage the private sector in emerging economies to contribute to filling domestic and international needs, including through the above mentioned innovative financing mechanisms (e.g. bonds, voluntary contributions to UNITAD from business travels, remittances, in-kind provision of high quality products and services at international standards, etc.). F.3 Develop ideas to solicit additional support from foundations, e.g. in the form of challenge grants or matching gift mechanisms, in collaboration with the Gates Foundation or other major partner foundations, aiming at leveraging support to the global maternal and child health agenda with a well profiled malaria component (and, for example, allowing foundations or HNWIs from emerging economies to contribute to the needs of their countries or regions). G. Explore cost efficiencies and better integrated services to decrease resource needs Several studies have been undertaken to examine the possibility of cost efficiencies. The below suggestions are summarized from CHAI ("Value for Money in Malaria Programming: Issues and Opportunities", 2011) and R4D (Results for Development, 2011 - Box 2). G.1 Identify more effective ways of procuring LLINs. Bednet programs amount for more than 80% of spending. There could be gains of 10% or so from more efficient procurement. Gains in value for money would be obtained by measures such as better spatial targeting, longer net life or more efficient replacement, as well as cutting net prices. It may also important to explore further public demand for LLINs in endemic countries by promoting a cheaper shorter-lasting insecticidal net to be uniquely available for purchase by the public in order to test and develop the private market. G.2 Reduce overlap of LLINs and IRS programs, at least until more is known about the possible benefits of providing them together. Most spraying is currently done in areas that are also covered by bednet programs. Research is underway to estimate the additional protection provided by the combination of the two interventions, to be weighed against the additional cost. G.3 Rotate insecticides used for IRS to delay resistance. The spread of resistance to current insecticides is a serious threat to malaria prevention and control and value for money of malaria interventions. Both the use of multiple insecticides in vector control programs and the development of new ones are a high priority, as well as continuing research and bringing down the costs of existing alternatives. G.4 Accelerate the availability and appropriate use of RDTs. RDTs are cost effective when the benefit of appropriate treatment of non-malarial fevers are considered.

31

G.5 Better understand the efficiencies of integrated health packages including systematically malaria prevention, control and elimination components. Analyses have been carried out in different countries of the costs of integrating bednets, in particular, into measles, water and sanitation, HIV/AIDS or polio vaccination interventions. Overall, it has been argued that integration results in reduced costs, increased coverage, early detection, reduction in stigma and delayed disease progression (e.g. for HIV/AIDS) through prevention of malaria. However, on the negative side, a major reason for not using an integrated approach has been the need to achieve rapid scale up in targets through large-scale, disease-focused national campaigns. A more in-depth validation of integration costs and savings and a review of financing models and opportunities and obstacles for integration are needed for making a convincing case for integration approaches with national authorities and donors.

Box 2 - Cost efficiencies in LLIN procurement R4D (Results for Development) has noted annual decreases in pricing from 2007 given increasing volumes and a more diversified supplier base, with 3 suppliers in 2007 and 10 suppliers in 2011.These price declines have accelerated in 2011. R4D has identified three potential opportunities for increasing the efficiency of the LLIN marketplace: a) focus on highest value for money products; b) reduce the fragmentation of packaging and specifications (200+ supplier offerings, with ~25 commonly purchased variants); and c) strengthen strategic national procurement capacity (e.g. improved forecasting/quantification, splitting tenders). The streamlining of packaging and specifications would not only save well over US$100 million over 5 years, but it would also lead to a reduction of over one month in lead time to delivery. R4D will also continue to explore the following key issues in coming months to determine any potential market dynamics interventions:

Product innovation

� Price focused tenders reduce incentives for innovations on quality � Insecticide resistance is emerging as a key concern, though next generation

‘resistance’ nets may be more expensive → need to review procurement policies, incentives for innovation around resistance-management nets.

Competitive marketplace

Market conditions (e.g. challenges in production planning, ‘winner takes all’ tenders, decreasing prices) may threaten a competitive, sustainable supplier base.

Country strategies

� Net usage rates are below target levels, with limited evidence on drivers of net

usage → need to develop, incorporate info into LLIN strategies � Effective continuous replacement financing, procurement strategies are critical to

establish following universal coverage push.

Local production

R4D will explore local production as it relates to market dynamics impact (e.g. shorter lead times, reduced delivery costs) with development benefits examined by the School of Oriental and African Studies (SOAS) and others.

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Special Focus on Africa The vast majority of deaths are occurring in sub-Saharan Africa. The financing gap for commodities and their delivery is US$3.2 billion from now until the end of 2015. Based on current discussions strategic action on this special focus objective would include:

� US$1 billion anticipated from the Global Fund which will be applied to 2015 targets and could potentially fully fund 2015 needs for Africa with the exception of except Nigeria, the cost driver in the continent

16.

� US$ 1 billion needed for Nigeria for 2012-15 to be addressed by a special support group, including the federal and state governments of Nigeria and committed donors;

� US$ 0.6 billion for 2012-2014 for African countries (except Nigeria) to be mobilized through development banks' loans and the Global Fund’s Transitional Funding Mechanism;

� US$ 0.6 billion, the remaining funding gap, to be mobilized 2012-2014 through other donors, still to be identified.

ALMA and the RBM Harmonization Working Group, together with relevant Board members and members of relevant RBM Committees and supported by the RBM Situation Room, will be primarily tasked with the responsibility to work with countries in Africa to achieve this priority fundraising objective.

16

It is hoped that the Global Fund to Fight AIDS, Tuberculosis and Malaria, which has been a leader in enabling the funding successes of the last few years, will provide funding to meet two-thirds of the total gap, in line with the proportion it has previously funded.

33

6. SWOT analysis, roles and responsibilities in the RBM Partnership and budgetary implications

6.1 Fundraising capacity of the RBM Partnership: analysis of Strengths, Weaknesses, Opportunities and Threats (SWOT analysis)

Strengths

� Remarkable success of the Partnership in increasing funding over the last years. The Partnership is well positioned and visible, and can learn from and build on its success.

� The public/private nature of the Partnership, including public sector donors, endemic countries, multilaterals, foundations, the private sector, civil society and academia puts it in a unique position to leverage maximum influence for the global malaria targets as well as for fundraising from various funding sources.

� The creation of the RBM Resource Mobilization Sub-Committee shows the determination of the Partnership to work together and share knowledge on fundraising for more effectiveness.

� The record of results and impact is strong. The Partnership has developed over time strong arguments for investing resources in malaria; these need to be updated and adjusted to the new environment.

Weaknesses

� Not all Partners are currently directly engaged in fundraising efforts for the GMAP. � Responsibilities on resource mobilization have been scattered, without clear coordination

and information sharing processes in place. � Partners have still to learn from the process on how to develop a culture of common

purpose in fundraising for the GMAP. Opportunities

� The Partnership has a relatively strong support from the philanthropic sector. Philanthropy, including venture philanthropy, has a marked interest in maternal and child health, and could offer important fundraising opportunities.

� The Partnership has Board members, or members of organizations represented on the RBM Board, who are high-profile figures who can use their status, experience and connections to advocate and significantly support fundraising for the GMAP, in view of the 2015 GMAP Objectives and Targets.

� Research and development capacity in the Partnership is well funded and progress is under way to discover new tools that can decrease the malaria burden and future malaria prevention, control and elimination costs.

� Social networks, if well managed by the Partnership, can be a source of support and visibility for the resource mobilization objectives.

Threats

� The overall slowing down in ODA growth is forecast to be more marked for support to low income countries and for Africa. The overall slowing down in ODA growth is forecast to be more marked for support to low income countries and for Africa. The uncertainties around the Global Fund's capacity as a main funder of the GMAP over the next few years, are a major, immediate threat, which requires the RBM Partnership's attention and preparedness to explore alternatives.

� Some high-burden countries are unstable, and this poses problems for both domestic and external investments in malaria prevention, control and elimination.

� Population growth in malaria-affected countries may have significant impact on the malaria prevention, control and elimination efforts (it is for example forecast to soon outpace ODA growth).

� Commodity prices: vaccine and medicine prices affect the partnership mission and attainability of fundraising objectives.

Elements that are both opportunities and threats

34

� Financial control and oversight is essential for effective management and risk mitigation at country level, however it can be detrimental if it paralyses countries in their scaling up of efforts for impact.

� The emerging economies are showing support to development aid and the MDGs. These commitments can increase further and be better coordinated with those of other donors.

� Other health and development areas are receiving attention from the development community (e.g. climate change). The Partnership needs to map out systematically competitive challenges and opportunities for synergistic resource mobilization.

� Increased resistance to artemisinin and insecticides is experienced in some regions. While this is a major challenge in perspective, it also offers the opportunity of positioning even more strongly on the international public health and donor agenda malaria prevention, control and elimination as a global public good.

� Regulations. Trade laws as well as drug regulations may have a positive or negative impact on scaling up malaria prevention, control and elimination efforts and deployment of resources.

6.2 Roles and responsibilities in the RBM Partnership

6.2.1 The Board This resource mobilization strategy will have limited potential to be successful on any of the fundraising streams described in the previous chapters without active support from Board Members. As part of its responsibility for financial accountability and oversight, the Board plays a central role in ensuring that sufficient funds are raised to meet the needs for the 2012-2015 phase of the GMAP implementation, in view of the 2015 GMAP Objectives and Targets, and can use the Partnership Work Plan as an instrument to achieve this. The responsibilities of the Board as an entity can be summarized as follows:

� Provide overall guidance to and review challenges and opportunities of this resource mobilization strategy through discussions at Board meetings;

� Ensure appropriate donor representation in the governance processes of the Partnership, including encouraging new donors to join the funding effort through domestic investments as well as bilateral and/or multilateral aid;

� Help its Chair and Vice-Chair to take a leadership role in advocating for increased resources;

� Challenge its Members to be proactive advocates for increased resources with their respective countries and constituencies.

Board Members, individually, are responsible for:

� Acting as advocates and spokespersons when any opportunity arises, to give credibility to the fundraising efforts;

� Using their networks and contacts to broaden the group of decision makers and influencers in development financing that can be instrumental in addressing the funding challenge towards the achievement of the 2015 GMAP Objectives and Targets.

Board Constituencies. Each Board Constituency has different assets in supporting the resource mobilization effort. Some of them are more apparent, and will be reviewed below, some others may need to be identified and mapped on a case by case basis. Malaria Endemic Countries The success of this resource mobilization strategy depends very much on the endemic countries investing domestically and presenting a convincing demand for external aid to address malaria as a priority public health problem. The constituencies from malaria endemic countries can be key actors in involving and facilitating dialogue of the Partnership with their Ministers of Health and Ministers of Finance around domestic investments and innovative financing opportunities (such as Diaspora funding). The Chair of the Board, in particular, having traditionally been in the RBM Board a high-level representative from an endemic country, presently a Minister of Health, can play a prominent role, together with the RBM Executive Director and ALMA, in advocating with peers for domestic funding and providing a voice from the south in the fundraising dialogue with existing and potential donors.

35

Board Members of the Malaria Endemic Countries also play a crucial role in informing the Partnership of opportunities for profiling malaria in consultations and events of regional, sub-regional and international groupings (African Union, regional economic and development commissions, the ACP group of states in the dialogue with the European Commission, the Organization of the Islamic Cooperation, the Organization of American States, etc.) and therefore spread the word and engagement of other southern constituencies about prioritizing malaria and adopting resolutions for members to commit to financial support. Board Members from endemic countries that are emerging economies are instrumental in helping the Partnership to articulate a “case statement” for support of resource mobilization objectives and to facilitate the Partnership's outreach to relevant ministries for domestic investments and malaria aid to third countries, as well as for advocacy opportunities e.g. in the context of the G20 process. OECD Donor Countries The OECD Donor Members are the core actors when it comes to engaging the G7/G8 leadership as well other OECD/DAC development agencies and the European Commission in support of malaria prevention, control and elimination. They can make a convincing case for increased bilateral and multilateral funding from those governments and other traditional donors, and help the Partnership prevent and react timely to donor fatigue and ensure continued engagement in funding for malaria. OECD Donor Members can help identify for the RBM Partnership opportunities to position malaria prevention and control and related requirements in relevant donor fora, such as the G8 and G20 processes, the EU agenda and OECD/DAC consultations. Also, OECD Donor Members can support this resource mobilization strategy by advocating for including malaria prevention, control and elimination in integrated packages of health services within their health system strengthening/maternal and child aid budget, as well as in trilateral cooperation agreements between their governments, emerging economies and malaria endemic countries, debt relief deals and re-programming options that can help frontload resources to accelerate scaling up of interventions. Multilateral Development Partners Multilaterals have the advantage of an extensive field presence, which is instrumental for the dialogue with endemic governments about elevating malaria in domestic financing and with donor delegations about aid at country level. The UN Members help profile malaria in the MDG agenda and advocate for increased funding in support of the impact that the 2015 GMAP Objectives and Targets can have on the achievement of the 2015 MDGs. The World Bank has a distinct advantage, in addition to being a major external donor for malaria prevention and control, in bringing the GMAP financing needs to the attention of Ministers of Finance in endemic countries. The World Bank has a primary role in fostering the use of IDA loans in support of the 2012-2015 needs and beyond. The World Bank can also be a key actor in supporting the RBM Partnership's dialogue with regional banks for substantial scaling up funding for regional needs. The Members of the Multilateral Constituency can also rely on their liaison offices in donor capitals for intelligence building and dialogue with key potential donors (e.g. World Bank and UN offices in Brussels to explore funding options from the European Commission's External Action budgets; World Bank and UN offices in Moscow to maintain and increase attention on malaria elimination from the Russian Federation; etc.). Research and Academia The Research and Academia Constituency has a primary role in advising on specific opportunities to fund research as part of the overall fundraising effort (e.g. supportive arguments for outreach to DG Research in the European Commission) as well as identifying and involving leading academics in influencing aid decision makers (e.g. tropical research institutes in targeted donor countries can help advocate for support from their governments for the fundraising effort in countries of geo-

36

political priority). The Members involved in operational and economic research help take forwards the agenda on cost efficiencies and return on investment, which has a major impact on decreasing the price tag of the 2012-2015 phase of the GMAP and on providing a key advocacy argument for increased investments. Non-Governmental Organizations The role of the NGO Board Constituencies is crucial to ensure that civil society and communities have an effective role and voice in identifying needs and in promoting supportive advocacy activities with both the public and the private sector. This includes supporting the mobilization of southern advocates and other partners. The NGO Board Constituency provides an important entry point for key advocacy opportunities, to facilitate the organization of events and reinforce messages from the grassroots, and also for increasing the demand for malaria interventions and mobilizing the private sector and the communities in endemic countries. Private Sector The Private Sector Constituency guides and advises the Partnership on development of high-priority funding opportunities with the corporate sector, including innovative financing solutions involving the financial sector, as well as efficacy of supply chain management and measurement tools. The Constituency is also a leading actor, together with the Special Envoy, in outreach to major corporations and advocacy activities with the private sector. Foundations The Foundation Constituency and its leading Members can make influential advocacy around the urgency of fully funding the 2012-2015 needs in view of the achievement of the 2015 GMAP Objectives and targets and also in developing innovative ideas around leveraging increased funding from the public and private sector (including through challenge grants, matching gifts, etc.). The Constituency has also been so far a key actor for support to the research agenda and monitoring and evaluation needs. Ex Officio Board Members African Leaders Malaria Alliance (ALMA) Because of its top-level membership of Heads of State and Government from Africa, ALMA plays a similar role as the endemic country constituencies (see above) in high-level advocacy for domestic investments and presenting a convincing demand for external aid. The ALMA "Scorecard for accountability and action" also provides and useful tool to track funding for commodities. The Global Fund The Global Fund has been the major external financier for malaria prevention and control, and it has a key responsibility and challenge in attracting confidence from development donors and in identifying with partners how its resources can provide the maximum impact. The support of the Global Fund Board Member is important to help the Partnership identify options for flexible and efficient use of available resources to support scaled up efforts at country level and maximize results, including in the context of the current constraints and the Global Fund's ongoing architecture review and strategy development. UNITAID UNITAID's long-term funding commitment has important implications not only for the level of funding available for the GMAP but also for fostering market dynamics that can result in decreasing the overall price tag and increasing value for money. The UNITAID Board Member can be an important ally in this resource mobilization strategy by helping identify and share information about malaria specific opportunities that may be made available through the UNITAID processes as well as involving UNITAID in joint fundraising and advocacy opportunities. UN Secretary General Special Envoy for Malaria

37

The UNSG Special Envoy is the key UN ambassador for political will and funding for the GMAP, and he has a primary role in profiling malaria high on the UN Secretary-General's agenda, including in interaction with governmental leaders on behalf of the Secretary-General, in the UN processes and in global advocacy and political positioning of malaria in the international development agenda. Because of the Special Envoy's leverage in the corporate and philanthropic sector, he also has a comparative advantage in leading outreach to major corporations, together with private sector partners.

6.2.2 Secretariat The Executive Director ensures the bold political leverage that is needed for advocating convincingly for the GMAP, for interacting with the decision makers at the highest level from both donor and endemic countries. The Secretariat has the responsibility of taking forwards information sharing for coherent approaches between Partners on fundraising targets, activities and outcomes, ensure harmonized reporting systems and consistency of data messages around resource mobilization across the Partnership and engage SRN and relevant Working Group Focal Points in supporting resource mobilization objectives. 6.2.3 Sub-Regional Networks and Working Groups The Sub-Regional Networks, as coordinating bodies of Partners, can have a supportive role in helping fundraising at local level. Among the Working Groups, the Harmonization Working Group has developed a role in supporting resource mobilization at country level, to facilitate a high level of success in applications to the Global Fund and other major funding initiatives. The work of the Malaria Advocacy Working Group would also have a link to the resource mobilization effort.

6.3 Budgetary implications Scaling up the GMAP resource mobilization effort for 2012-2015 will have cost implications. It is expected that Partners will help address these costs and sponsor from their budgets additional studies or activities that may be needed as well as cover their outreach activities and meeting costs. A few structural costs would also need to be specifically budgeted in the Partnership Work Plan. These mainly include provisions related to a core capacity to facilitate the implementation of this strategy, with a focus on helping the RBM Executive Director to facilitate coordinated tracking and regular information sharing with Partners on evolving GMAP resource needs, commitments, funding flows and funding gaps, including in the context of special focus needs that the Partnership may decide to concentrate on. This, in collaboration with WHO and funding tracking processes carried out by other Partners, will help develop a more robust and consistent base of data, including for countries outside Africa, to feed the funding section of the GMAP Implementation Overview and alert Partners on needs and opportunities to inform their action.

38

7. Conclusions and recommendations The RBM Partnership must remain prepared for a considerable funding effort to meet the global malaria prevention, control and elimination needs to be met by 2015. It is anticipated that most of the RBM top donors will continue to constitute the main source of funding, but also acknowledges that they cannot be solely responsible for the required scaling up and for sustainably maintaining the levels of coverage achieved. The previous chapters have outlined where to find additional funding, how to mobilize and what the RBM partnership needs to be ready to do in order to take this resource mobilization strategy to a different level of funding outcome. Here a summary of the main points:

� The dramatic increase in global funding for malaria prevention, control and elimination has led to a remarkable record of results and impact. There are clear indications that the international community is maintaining commitment, and for some donors notably also funding commitment.

� The RBM Partnership contributed positively to this fundraising success, and it has shown over the past few years both strengths and weaknesses, notably in engaging proactively and cohesively in resource mobilization. The Partnership will need to be ready to adapt quickly and respond effectively to challenges in order to be even more successful in resource mobilization.

� There is now a renewed urgency to meet the funding challenge represented by the global financial crisis and a significantly reduced potential for Global Fund’s support, at least in the near future, with much more limited resources to meet the 2015 targets.

� Raising additional financial support is a challenge, but not an insurmountable one, if the RBM Partnership commits to contribute cohesively to the expansion of fundraising efforts. All Partners will need to contribute, and the Board will need to play a key role in guiding the funding efforts with even more emphasis than before.

Recommendations: The Resource Mobilization Sub-Committee proposes the following recommendations for the Board - and respective oversight roles:

� Endorse the funding target and the fundraising streams described in this strategy, with an immediate focus on the GMAP target of reaching near zero malaria deaths by 2015 and with a view to getting as close as possible to filling the funding gap of the GMAP for 2012-2015.

Oversight: Chair of Performance Work Stream. � Commit to proactively support this resource mobilization strategy and invite Board Members to

volunteer to mobilize their political leverage, expertise and contacts to serve this strategy. Oversight: Chair of the Board.

� Encourage further bilateral and multilateral support in support of the 2012-2015 GMAP needs,

with a view to making additional funding available to high-burden countries. Oversight: Donor Constituency Representatives and UN Special Envoy.

� Encourage Board Members to urge high-burden endemic countries to engage their Ministers of

Finance in supporting increased domestic investments for malaria prevention, control and elimination, in consideration of the urgency of scaling up funding, looking at ways to frontload resources, including by applying for loans from the 16

th and/or 17

th IDA Replenishments.

Oversight: World Bank Representative, UN Special Envoy and ALMA Representative (for Africa).

� Invite Board Members from emerging economies to contribute to scaling up their bilateral and

multilateral support to malaria endemic countries to achieve the MDGs by 2015, both through increased investments for domestic needs and by positioning malaria prevention and control high on their aid agendas and budgets.

Oversight: Board Members from G20, UN Special Envoy.

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� Request the RBM Executive Director to support the follow-up to these recommendations and implementation of the strategy, including helping develop a harmonized tracking system for resource needs, commitments, funding flows and funding gaps, so as to develop a more robust and consistent base of data, including for countries outside Africa, in support of an effective implementation of this strategy.

Oversight: Chair of Performance Work Stream. � Urge each Partner to confirm commitment to make ending of malaria deaths a major

development priority for the next four years. Oversight: Chair of the Board and UN Special Envoy.

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Annex I. Summary of PESTEL analysis of the GMAP resource mobilization environment

Key driver Opportunity Threat

Political Stability in traditional donor countries, leading to lack of leadership on

ODA and Health

- Upheaval in Euro area

- Paralysis in Japan

- Partisan approach in US and other donor countries X XRight wing political shifts in major donor countries

- Uncertainty on the availability of long-term funding sources

- Decreasing priority on ODA XInternational political power balance changing

- waning influence of traditional G8 donors

- unclear commitment from "rising" G20 countries, unclear legal structures X XCompeting development priorities

- Visibility of malaria among other areas (migration, climate change etc)

- Shift of ODA towards Climate change (with potential upside for malaria) X XFocus on Mother and Child Health

- Potential for increased focus on malaria X XValue for money

- Performance based funding

- Cost effectiveness of interventions X X

Political instability in high burden countries affecting implementation X

Global Economic Environment

- Recession

- Exploding debt burden in donor countries

- Stalled growth

- Currency fluctuation risks X X

Emergence of new economic powers

- ODA potential XFocus on benefit of investments

- Economic return of malaria investment

- Focus on value for money & cost effectiveness

- Performance based funding X XDonations

- Increasing philanthropic donations (through eg tax incentives)

- Personal donations/collections X

Innovative Financing

- Emergence of new mechanisms to ensure sustainability and predictability in funding

- Financial Transaction Tax (devoted to Health)

- Increased Cause related marketing by partners to fundraise XIncreased focus on financial accountability - less rapid scale-up

- Focus on financial control and oversight and value for money, may prevent rapid scale-

up X

Push for MDGs leading to increase in funding towards 2015 X X

Social Networking

- Internet crowd sourcing XTrust in traditional institutions

- More focus on niched NGOs

- RBM perception as a UN organization

- Cultural aspects to support foreign bodies such as RBM XRBM Brand

- RBM Board Relations - opportunity for leveraging X

Focus on results through "personal stories" X

Population growth in endemic countries X

Commodity prices

- Vaccines and medicine prices affect our mission and fundraising objectives XNew Products

- Discovery of more effective cures/vaccines/insecticides

- Increase in drug and insecticide resistance

- Value for money drives product development XChanges in research agenda (MalERA)

- Development of elimination strategy for vivax X

Climate change X X

Urbanization and land use X X

Drug and insecticide resistance

- New drugs and insecticides X

Changes in animal reservoir (genotype change)

Trade regulations impacting on malaria commodities X

Drug regulations and licensing X

Depency on WHO for setting technical standards and product evaluation X

Environmental

Legal

Political

Economical

Social

Technological

41

Annex IIa - Aid investment in GMAP from OECD/DAC and BRIC governments and simulation of increased investments (US$)

2010 Net ODA 2009 Net ODA

Bilateral malaria

contributions

(commitments) -

OECD/DAC 2009

Multilateral

malaria

contributions

2009 (27% of

GFATM

contribution -

Round 9)

Contribution to

R&D 2009

Estimated % of

2009 ODA

Contributed to

malaria

1.5% of 2010 ODA

for malaria control (when not yet reached)

2% of 2010 ODA

for malaria

control (when not yet

reached)

Australia 3,849,000,000 2,762,000,000 0 8,861,319 11,391,587 0.7% 57,735,000 55,240,000Austria 1,199,000,000 1,142,000,000 167,100 0 0.0% 17,985,000 22,840,000Belgium 3,000,000,000 2,610,000,000 1,660,400 6,299,646 0.3% 45,000,000 52,200,000Canada 5,132,000,000 4,000,000,000 35,728,000 38,201,585 1.8% 73,929,585 80,000,000Denmark 2,867,000,000 2,810,000,000 0 8,605,774 0.3% 43,005,000 56,200,000Finland 1,335,000,000 1,290,000,000 332,900 1,322,339 0.1% 20,025,000 25,800,000

France 12,916,000,000 12,600,000,000 515,200 111,934,657 11,027,001 1.0% 193,740,000 252,000,000

Germany 12,723,000,000 12,079,000,000 456,300 73,289,279 5,383,784 0.7% 190,845,000 241,580,000

Greece 500,000,000 607,000,000 13,900 0 0.0% 7,500,000 12,140,000

Ireland 895,000,000 1,006,000,000 1,698,900 3,770,820 0.5% 13,425,000 20,120,000

Italy 3,111,000,000 3,297,000,000 3,070,200 50,788,598 1.6% 53,858,798 65,940,000

Japan 11,045,000,000 9,457,000,000 19,297,500 52,495,040 0.8% 165,675,000 189,140,000

Korea (ROK) 1,168,000,000 816,000,000 104,800 945,000 0.1% 17,520,000 16,320,000

Luxemburg 399,000,000 415,000,000 1,069,500 896,872 0.5% 5,985,000 8,300,000

Netherlands 6,351,000,000 6,426,000,000 0 22,537,440 6,185,521 0.4% 95,265,000 128,520,000New Zealand 353,000,000 309,000,000 0 0 0.0% 5,295,000 6,180,000Norway 4,582,000,000 4,086,000,000 1,160,000 18,130,865 0.5% 68,730,000 81,720,000Portugal 648,000,000 513,000,000 29,200 675,000 0.1% 9,720,000 10,260,000Spain 5,917,000,000 6,584,000,000 5,769,900 57,510,000 6,526,248 1.1% 88,755,000 131,680,000Sweden 4,527,000,000 4,548,000,000 0 24,230,648 0.5% 67,905,000 90,960,000

Switzerland 2,295,000,000 2,310,000,000 0 1,699,182 0.1% 34,425,000 46,200,000 Top level donorsUnited Kingdom 13,763,000,000 11,283,000,000 46,346,900 49,699,251 30,190,739 1.1% 206,445,000 225,660,000 Higher middle range donors United States 30,154,000,000 28,831,000,000 373,842,700 258,939,905 164,805,181 2.8% 797,587,786 797,587,786 Lower middle range donors

Sub-total 128,729,000,000 119,781,000,000 491,263,400 790,833,218 235,510,061 0.7% 2,280,356,168 2,616,587,786 Bottom level donors

1,517,606,679

Sources: OECD, 2011: http://www.oecd.org/dataoecd/54/41/47515917.pdf; GFATM Pledges and Contributions Table (accessed June 2011)

Simulation of

potential

Bilateral malaria

contributions

(average

estimates)

Other malaria

contributions

2009 (27% of

GFATM

contribution,

UNITAID,

WHO/WB

Booster)

Contribution to

R&D 2009

Estimated % of

aid to malaria

4% of aid for

malaria control

Brazil 1,000,000 3,400,000 6,500,000 1.8% 23,600,000

China 24,400,000 540,000 1.7% 60,000,000

India 0 540,000 8,400,000 1.5% 24,000,000

Russian Federation 0 6,000,000 1.2% 20,000,000

Sub-total 25,400,000 10,480,000 14,900,000 1.6% 127,600,000

50,780,000

Simulation of

potential

Bilateral malaria

contributions

(average annual

estimates)

Multilateral

malaria

contributions

2009 (27% of

GFATM

contribution,

UNITAID,

WHO/WB

Booster)

Contribution to

R&D 2009

Estimated % of

aid to malaria

4% of aid for

malaria control

Brazil 1,000,000 3,400,000 6,500,000 1.1% 40,000,000China 24,400,000 540,000 1.2% 80,000,000India 0 540,000 8,400,000 0.9% 40,000,000Russian Federation 0 6,000,000 1.2% 20,000,000

Sub-total 25,400,000 10,480,000 14,900,000 1.1% 180,000,000

50,780,000

1,000,000,000

2,000,000,000

1,000,000,000

600,000,000

Donor Country

Annual aid budget (higher estimate)

Current aid level

Donor Country

Current aid level

Aid investment in malaria control from OECD/DAC and BRICS Members and simulation of increased investments

Donor Country

Current aid level Simulation of potential

Sources: RMSC Paper: "Financial opportunity mapping with Brazil, Russia, India, China, South Africa, Malaysia and Mexico"; GFATM Pledges and Contributions Table (accessed June 2011)

500,000,000

3,190,000,000

500,000,000

Annual aid budget (average estimate)

590,000,000

1,500,000,000

4,500,000,000

42

Annex IIb. Domestic investment in health and malaria control from high-burden African countries and simulation of increased investments

% growth

(constant

price, local

currency)

Monetary

growth (US$

billion)

Nigeria 1.6 1 55,707,630 0.20 9,793 0.0 6.4% 6.95% 4.270 170.8

Uganda 0.7 6 9,075,134 0.00 1,296 0.0 11.6% 7.24% 0.435 17.4

DRC 0.6 2 18,168,420 2.00 222 0.9 1.7% 2.83% 0.013 0.5

Tanzania 0.5 3 11,374,250 NA 1,069 NA 18.1% 6.70% 0.597 23.9

Sudan 0.4 7,888,891 26.27 4,073 0.6 9.8% 5.98% 0.375 15.0

Mozambique 0.3 4 7,538,293 0.00 573 0.0 12.6% 6.33% 0.296 11.8

Ghana 0.3 6,278,813 8.70 2,105 0.4 12.8% 4.65% 0.652 26.1

Cameron 0.3 5,146,960 8.55 1,553 0.6 8.2% 1.95% 0.362 14.5

Cote d'Ivoire 0.2 9 7,460,826 0.00 1,147 0.0 4.4% 3.75% 0.625 25.0

Burkina Faso 0.2 5 5,086,618 0.02 542 0.0 16.3% 3.24% 0.206 8.2

Niger 0.2 8 4,542,784 0.90 322 0.3 14.5% -0.80% -0.034 0.0

Chad 0.1 7 4,143,122 0.00 488 0.0 13.8% 0.27% 0.013 0.5

* Data not yet validated through country consultative process as of March 2011

Simulation:

Malaria

spending at

4% of

annual

growth

(USD

GDP growth 2009/2008 (IMF,

WEO April 2011)

Countries

GMAP Costs

2012-2015

(USD billion)

Death

burden

(ranking -

WHO 2011)

Disease

burden

(number of

cases: WHO,

2011*)

Annual

malaria

investments

(US$ million

2009 - WMR

2011)

Health

investments

(US$ million

2009 -

extrapolatio

n from IMF

WEO 2011

Malaria

spending as

% of health

spending

Progress in 15%

Abuja target

(WHOSIS 2011)

Annex III. Explanatory note on the resource mobilization scenarios Projections for US, UK, other OECD/DAC governments, European Commission, emerging economies and the Bill and Melinda Gates Foundation exclude pledges to the Global Fund Third Replenishment 2011-2013.

� Projection of US ongoing funding is based on the expected 2012 appropriation and currently financed amounts at US$585m per year, which would need to be adjusted based on year-by-year appropriations.

� Projection of UK ongoing funding is based on UNSEO analysis of resources

committed according to existing operational plans (as per GMAP Implementation Overview).

� UK potential funding adds potential from full implementation of the funding commitments in the DFID Framework for Results (£500 million annually by 2014/2015, or some US$800 million at the time of the announcement).

� Projection of other OECD/DAC governments' ongoing funding is based on

OECD/DAC data on 2009 bilateral aid and aid to research and development. � Additional OECD/DAC potential could project that the G7 members and a few

selected other members will increase their funding to at least 2% of their annual ODA (using as a comparator the US investment of 2.8% and based on OECD/DAC estimates of 2010 ODA).

� Projection for the European Commission is based on data on 2009 aid to research

and development. � Additional potential could project that the European Commission increases malaria

aid at the level that is expected from G7 members that are currently making comparable investments (Germany has been used as a comparison to project this figure in this document).

� Projection of BRIC (Brazil, Russia, India, China) ongoing funding is based on the

available 2009 data on malaria spending, notably on bilateral aid and contributions to Global Fund, UNITAID, World Bank, and research and development.

� Additional emerging economies' potential could project aid investments for malaria at some 2 % of BRIC aid budgets (using as a comparator the US investment of 2.8% and based on average estimates of BRIC aid budgets). Higher potential could factor in the same proportion but based on higher aid estimates. Additionally emerging economies other than the BRIC countries could be factored in (e.g. Turkey and Middle East oil exporting economies).

� Projection of Global Fund's ongoing funding is based on annual projection of

resources not yet disbursed for approved grants up to Round 10 (and including NSA and single stream funding) and assumes all these grants will continue to completion. The Global Fund's reprioritization process in development may require adjustments to these estimates in the months to come.

� Global Fund's potential (lower) assumes additional income from Round 11 and Round 12, assuming (based on data as of 8 November 2011) rounds of US$0.5 billion and at level of success of malaria grants slightly higher than the proportion of total Global Fund's funding achieved in Round 10 (40%, against 34% in Round 10). This assumption may need to be adjusted over the next months to come based on updated estimates and decisions by the Global Fund Board.

� Global Fund's frontloading option would assume arrangements for reprogramming part of the approved funding for 2014-2015 and make it available for accelerated scaling up in 2012-2013.

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� Projection of World Bank’s ongoing funding is based on existing resources committed through existing projects through the Malaria Booster Program.

� Projection of World Bank’s committed is based on the pledge by the President of the World Bank in September 2008 for the Malaria Booster Program Phase II, i.e. US$1.1 billion for malaria, after deduction of US$300 million that have already been committed.

� A World Bank’s frontloading option could project IDA loans to accelerate domestic investments in Africa.

� Projection of Regional Banks ongoing funding is based on extrapolation of

information about annual budgets of ongoing and past projects. � Additional Regional Banks potential could be factored in by projecting higher

investments in grants and loans. � Projection of the Bill and Melinda Gates Foundation’s ongoing funding is based on

the GMAP Implementation Overview. � Other philanthropic potential could be projected in traditional and emerging

markets, e.g. in the form of matching grant challenge with the Gates Foundation. � Projection of ongoing funding from innovative financing is based on current malaria

share of UNITAD resources (26%) as a proportion of the part of the UNITAID income from the tax levy.

� Potential from innovative financing could project income from new mechanisms, such as a malaria bond.

� Projection of ongoing domestic funding is based on the data on the 2009

investments from the 2010 WMR. � Additional domestic investment potential could be projected, e.g. that endemic

countries in Africa with economic potential invest a proportion of GDP growth (if relevant), that Brazil and China will fully cover domestically their 2012-2015 GMAP needs, that Indonesia cover its needs at least at 50% and India at least at 40%. This investment could come from a mix of public and private sources and could factor in innovative mechanisms such as remittances, bonds, etc. Part of the domestic investments from Africa, as mentioned above, could also be frontloaded through IDA loans.

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Annex IVa. TOR of the Resource Mobilization Sub-Committee Background At the 17

th meeting of the Roll Back Malaria (RBM) Board on 3 – 5 December 2009, the

Board asked Task Force 1 to: (1) develop new Terms of Reference for a Resource Mobilization Working Group (RMWG) to secure resources towards full implementation of the Global Malaria Action Plan (GMAP); and (2) create a redefined RMWG to develop the appropriate strategy for funding the GMAP. Task Force 1 would also look into the status of the RBM Resources Working Group that was approved by the Board in March 2003 and determine how it could be reconfigured in accordance with the new Board decision in December 2009. The Board recognized the importance of establishing a coordinating mechanism to oversee the development and implementation of the resource mobilization strategy for the GMAP. To reach the 2015 targets, almost US$6 billion USD was projected as the annual requirement. This level of funding has become a challenge to achieve, particularly in the face of the ongoing economic crisis. In 2010 alone, the funding gap against the projection to reach GMAP targets was estimated to be US$4 billion. At the19

th Meeting of the RBM Board on 6–8 December 2010, the Board decided to

rename the Resource Mobilization Working Group as the Board Resource Mobilization Sub-Committee and tasked it to establish a resource mobilization strategy, including traditional and new donors and innovative financing methods. I. Purpose/ Rationale The overall objective of the Resource Mobilization Sub-Committee is to develop a sustainable fundraising strategy to achieve the GMAP objectives, targets and milestones and oversee its implementation. The Sub-Committee responds to the expressed need for greater pro-activeness among RBM Partners, including endemic countries, to collectively address issues relating to an appropriate fundraising strategy for the GMAP, including appropriate investments for specific malaria control interventions or regions. The Sub-Committee serves as an advisory body to the RBM Partnership Board to enhance the RBM Partnership's capacity to mobilize new resources for the GMAP. The Resource Mobilization Sub-Committee is guided by the overall commitment of RBM Partners for: (i) strengthening partnership and capacity building; (ii) ensuring harmonization, accountability and transparency in scaling-up actions; and (iii) bridging the gaps between technical and programmatic support needs at country level. II. Functions of the Resource Mobilization Sub-Committee The Sub-Committee will: • Engage academia and/or other institutes and organizations to carry out an economic analysis on return of investments for malaria control, prevention and elimination. • Review and update the projections for resource needs and funding gaps. The Sub-Committee will commission work towards an improved malaria costing model, harnessing updated knowledge from national health accounts, price reporting mechanisms/databases, procurement management systems, and new evidence on control and elimination interventions, as well as needs for health systems and operational research. This

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information will feed into the resource mobilization strategy and will allow the GMAP to truly be a living and dynamic blueprint for fighting malaria. The Sub-Committee will work in close collaboration with the RBM Harmonization Working Group and the Sub-Regional Networks in this effort. • Provide an analysis of different resource mobilization scenarios and their consequences on GMAP implementation, with the objective of providing guidance to the RBM Partnership on options for financing effective and sustainable malaria control, prevention and elimination. • Develop a comprehensive resource mobilization strategy. The strategy should include innovative approaches tailored to different sectors - public, private, endemic countries – as well as innovative financing mechanisms to expand the donor base. The strategy will also provide options for implementation, including the need for dedicated staff within the RBM Secretariat for harmonizing resource mobilization efforts and building relationships with prospective donors. • Develop effective linkages to the RBM advocacy strategy to support the implementation of the resource mobilization strategy, in collaboration with other RBM Working Groups, such as the Malaria Advocacy Working Group, and including advocacy for financial commitments from endemic countries for better national ownership. • Coordinate partner efforts to track resources mobilized for GMAP implementation (e.g. National Health Accounts, malaria sub-accounts exercises), thus creating a harmonized reporting system for resources available, immediate resource needs and funding gaps. • Monitor and evaluate resource mobilization efforts and performance on a yearly basis with support from RBM Partners. The recommendations of the Resource Mobilization Sub-Committee will be reviewed and ratified by the Board. These functions will be revisited periodically to ensure continued relevance. III. Roles and Responsibilities and Working Procedures Roles and responsibilities and working procedures are governed by the RBM Operating Framework and By-Laws.

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Annex IVb. Members of the Resource Mobilization Sub-Committee (as of April 2012) Chair Alan Court Senior Adviser Office of the UN Secretary General's Special Envoy for Malaria Vice-Chair Peter Potter-Lesage Chief Financial Officer Medicines for Malaria Venture (Research and Academia) Secretariat Silvia Ferazzi Technical Officer RBM Secretariat Other Members Foundations Carol Medlin Senior Program Officer Bill and Melinda Gates Foundation Kelly Willis (since August 2011) Senior Vice President, Global Health Programs Accordia Global Health Foundation Malaria Endemic Countries Nie Jiangang (since June 2011) Director, Department of International Cooperation Ministry of Health People's Republic of China Multilateral Development Partners Maryse B. Pierre-Louis Lead Health Nutrition and Population Specialist The World Bank Non-Governmental Organizations Akudo Ikemba Chief Executive Officer Friends of the Global Fund Africa Louis Da Gama Director, Malaria Advocacy & Communications Global Health Advocates OECD Donor Countries Frédéric Goyet Head, Health Department Ministry of Foreign and European Affairs, France

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Timothy Ziemer Global Malaria Coordinator, President’s Malaria Initiative United States' Agency for International Development Private Sector Mikkel Vestergaard Director and Chief Executive Officer Vestergaard Frandsen Group Research and Academia (in addition to the Vice-Chair) Sally Ethelston (since January 2012) Director, Communications and Advocacy PATH Malaria Vaccine Initiative (MVI) African Leaders Malaria Alliance Joy Phumaphi (since April 2012) Executive Secretary Global Fund to Fight AIDS, Tuberculosis and Malaria Stefan Emblad Director, Resource Mobilization RBM Secretariat Thomas Teuscher Executive Director a.i. RBM Partnership

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Annex V. List of papers produced in preparation for the Resource Mobilization Strategy and other sources Papers for the Resource Mobilization Sub-Committee 1. Review of resource needs, financing flows and funding gap for the Global Malaria Action Plan, March 2011 2. Global Malaria Action Plan funding through innovative financing, March 2011 3. Revisiting the GMAP cost estimates for malaria control, March 2011 4. Financial opportunity mapping with Brazil, Russia, India, China, South Africa, Malaysia and Mexico, June 2011 5. Analysis of GMAP costing in selected high burden countries, PowerPoint Presentation, August 2011 6. Malaria Bond Concept Note, October 2011 7. Malaria Bond Business Plan, October 2011 Other selected sources 1. Macroeconomics and health: investing in health for economic development, WHO, 2001 2. Successful integration of insecticide-treated bed net distribution with mass drug administration in Central Nigeria, (B.G. Blackburn, A. Eigege, H. Gotau, G. Gerlong, E. Miri, W.A. Hawley, E. Mathieu, F. Richards), Am. J. Trop. Med. Hyg., 75(4), 2006 3. Vision 1440 H. A Vision for Human Dignity, Islamic Development Bank, 2006 4. The Global Malaria Action Plan. For a malaria free world, RBM, 2008 5. The Global Fund's role as a strategic and responsible investor in malaria, Board document, GF/B17/8, 2008 6. Emerging donors in international development assistance: a synthesis report (D. Rowlands), International Development Research Centre, 2008 7. We can't afford to wait: the business case for rapid scale-up of malaria control in Africa, Malaria No More and McKinsey & Company, 2008 8. Innovative financing for development, World Bank, 2009 9. G8 Muskoka Accountability Report. Assessing action and results against development-related commitments, G8 Canadian Presidency, 2010 10. Trends in development assistance and domestic financing for health in implementing countries, The Global Fund to Fight AIDS, Tuberculosis and Malaria, 2010 11. World Wealth Report, Merrill Lynch and Capgemini, 2010 12. Malaria funding and resource utilization: the first decade of Roll Back Malaria, RBM Progress and Impact Series n.1, 2010 13. Saving Lives with Malaria Control: Counting Down to the Millennium Development Goals, RBM Progress and Impact Series n.3, September 2010 14. The World Health Report. Health systems financing: the path to universal coverage, WHO 2010 15. World Malaria Report, WHO, 2010 16. How can disease control programs contribute to health systems strengthening in sub-Saharan Africa? Which health systems for disease control (W. Van Damme, M. Pirard, Y. Assefa, J. van Olmen), The Belgian Institute of Tropical Medicine, 2011 17. Value for money in malaria programming: issues and opportunities, Clinton Health Access Initiative, 2011 18. Maintaining the gains in global malaria control. The Health and Economic Benefits of Sustaining Control Measures, Clinton Health Access Initiative, 2011 19. The World's Billionaires, Forbes, 2011 20. G8 Deauville Accountability Report. G8 commitments on health and food security: state of delivery and results, Ministry of Foreign and European Affairs, G8 French Presidency, 2011 21. Making a difference. Global Fund Results Report 2011, The Global Fund to Fight AIDS, Tuberculosis and Malaria, 2011

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22. Hurun Philanthropy Report, 2011 23. Development aid reaches an historic high in 2010, OECD/DAC, 2011 (http://www.oecd.org/document/35/0,3746,en_2649_34447_47515235_1_1_1_1,00.html) 24. Staying the course? Malaria research and development in a time of economic uncertainty, PATH, 2011 25. The Millennium Development Goals Report, United Nations, 2011 26. Migration and Remittances Factbook, World Bank, 2011 27. Macroeconomics and health: investing in health for economic development, WHO, 2001 28. Global Plan for Artemisinin Resistance Containment, WHO 2011 29. IMF World Economic Outlook Database