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January 16, 2019

Bill Gates speaks about trade and donor money in Africa’s healthcare

Bill Gates: It's those healthy kids going to school that will be key to the future economic growth.
Bill Gates: It's those healthy kids going to school that will be key to the future economic growth.

The Star’s JOHN MUCHANGI joined a select team of African journalists to interview the philanthropist about his work on the continent


Philanthropist Bill Gates has expressed his support for private health facilities to take a leading role in providing primary health services in Africa. 

At the same time, he spoke about the role of donor funds on the continent, and whether trade would have better impact. 

Gates spoke in a teleconference with The Star and a few selected African media before he released his annual letter this week. 

He said the Bill and Melinda Gates Foundation has invested a total of $200 million in World Bank and Abraaj Group, which controls stakes at Nairobi Women’s Hospital, Avenue Hospital, Metropolitan Hospital, and Ladnan Hospital in Nairobi. 

“We have an investment with the World Bank where we gave them $100 million and they created a fund to invest in African healthcare. And we have another fund with Abraaj, which is a health fund that we put $100 million in that's $500 million that's investing in healthcare assets,” said Gates. 

Gates is one of the major proponents of the idea that private-sector investors need to take on a larger role in risky projects in the developing world. 

Abraaj is the largest private equity firm dedicated to developing economies.  

The teleconference came ahead of the annual letter by Bill and Melinda Gates. 

Gates Foundation has expanded presence in Africa in the last 10 years and has pledged to invest more than Sh500 billion over the next five years. 

“As a whole we're very active in Africa. If you had to categorise our spending, a lot of it is up in the research end, so working on an HIV vaccine, a TB vaccine, a malaria vaccine, and all the new tools for the diseases that disproportionately affect Africa in particular,” he said. 

Gates said the outcome has been phenomenal. The under-five survival rates have been going up, while malaria and HIV-related deaths have gone down.


Here is the abridged interview from the teleconference.

QUESTION: Where do you feel your greatest achievement is, at Microsoft or in philanthropy?

BILL GATES: Well, I think a lot of people would point to the foundation, because along with our partners, by getting out new vaccines and working with these primary health care systems, we've gone from having over ten million children die under the age of five back in the year 2000 to now where it's under five million. So that's been pretty amazing progress.

Also, although polio is not done, if we're successful in getting rid of the last cases this year, and then we go -- they have you wait three years until they fully certify the complete eradication. That is something the whole world would celebrate. I personally find it hard to compare because I think software and the Internet is doing great things, and certainly in my 20s and 30s that's what I was good at doing. And, in fact, it’s the resources and the skills, the kind of optimism and learning how to work with scientists and build teams a lot of those skills as well as that money were absolutely necessary for me to have the opportunity to be doing the Gates Foundation work. So I'm very lucky that I've had these two careers that are both fun every day and have had a positive impact. 


While we cannot ignore the importance of foreign aid and what it has done so far for poor countries, there has been evidence that shows that access to fair trade or having trade capacity is a much better option to eradicate poverty.

Is there a reason why the Gates Foundation doesn't push for or doesn't usually mention the importance of trade to end poverty or to invest in building capacity in that sector? Don't you think Africa is too dependent on foreign aid?

Well, there's no trade-off where if you take less foreign aid you get more trade, those two things exist absolutely separately. And the trade terms for Africa are actually in almost every case extremely favorable. For the United States you have the African Growth and Opportunity Act, and so you have lower tariffs on Africa than any set of countries in the world. And the European Union has the same thing.

The key is to raise up the health and education and infrastructure and the quality of governments in Africa so that there's more output, high quality output. And, yes, over time growing the economies of the African countries, including through trade, growing the private sector, will be key to them achieving middle income status and being self-sufficient. But the foreign aid is helpful to that because the key thing is, you've got to get the health and nutrition and education up to a very high level to drive the economic growth at full speed.

In the case of health, there's no direct financial payback, but it's those healthy kids going to school that will be key to the future economic growth.


There have been highly publicised cases of corruption and mismanagement of money that have come from donors in the Ministry of Health in Kenya and other countries which you partner with, some of that money came from your organisation. How do you feel about this, and what piece of advice would you give to those countries on how this can be addressed?

Well, certainly one of the challenges of the work we do is to minimise the amount of money that gets misspent. In some cases, like if you take vaccines, we're able to send them into the country as a commodity, and there is no black market for those vaccines. So in that case, there isn't much incentive to divert them, and we're able to track the shipments very carefully and see do they actually get used and improve the health.

The healthcare sector, although it's not perfect, it's a lot easier to track the activities and, of course, with digital techniques now where we can see where payments are being made, the GPS location, where we can ask people to take photos and gather other evidence, our ability to make it harder to divert the money and to be able to track who diverted the money we are improving on that.

It's tragic whenever health money gets misdirected because it has two effects. It has the effect on that specific money that should have saved lives, and then every time those stories get back to the donors, there's a huge reduction and a willingness to provide the aid. And so that negative effect, even if it's a small percentage that's been stolen, is very, very limiting. And so I'm always worried when that's uncovered whether governments in particular will substantially cut their aid budget.

And so we're always interested working on the ground, like if we're giving out money to a primary healthcare system, how we track that, how we have those bank accounts be open in a transparent way, and I will say that at least in the health sector, we've made progress being able to track things and try and minimize the money that goes astray. But in several countries, we have had those cases.


Given the Gates Foundation willingness to work with private corporations and your large presence in Africa, are you collaborating with any 100 per cent Africa-owned companies, innovative start-ups or actors in the African private sector to create efficient solutions in healthcare and other areas that you're working in?

Okay, good question. There certainly are. The companies we work with have a presence in Africa, and there are certainly smaller organisations, both profit and non-profit like eHealth in Nigeria or some of the scientific companies down in South Africa.

We have an investment with the World Bank where we gave them $100 million and they created a fund to invest in African healthcare. And we have another fund with Abraaj, which is a health fund that we put $100 million in that's $500 million that's investing in healthcare assets.

So in the case of healthcare, it varies from country to country, but at the hospital level many of the countries that will be for profit type entities, and certainly all the supply chain things that are going into those hospitals. For things like delivering to primary healthcare, we always encourage countries to use the private sector to do that. But in some cases, they feel like that should be done by government employees.

So the health sector will have a lot of private participants in it. And we're super supportive of that for the hospital pieces.

Bill Gates in a past interview.


Has the contribution and support of the Gates Foundation in developing countries, especially in the area of health and development met your expectations? What are the gaps?

Well, there's two types of gaps in health. One is that we're missing tools that would make a huge difference. And so there we need to fund the research. So in the case of HIV, we don't have a vaccine. We're spending literally hundreds of millions of dollars with many different approaches to try and invent that vaccine. And so our Foundation and the US Government are the two big funders there. And so a tool like that, or a malaria vaccine, a TB vaccine, there's a big gap because we won't be able to bring those diseases down until we have that new tool.

Then there are also gaps in terms of financing for existing tools. And that's why we created, in the case of vaccines, this GAVI, the Global Alliance of Vaccines, that buys the vaccines at the very lowest price and then uses donor money to finance most of the cost. We do ask the recipient countries to pay a small amount. And then if a country's economy grows enough, eventually they graduate from that.

In most areas the main limiting factor is the quality of the delivery system. That is getting things out into the rural areas and having the trained staff there. And the key is not so much the hospital systems for that as it is the primary healthcare system. And so we do a lot of work to help countries improve their primary healthcare system and the practices within it. That's turned out to be super important. I mention we're doing that not only in Nigeria but intensely in places like Ethiopia as well.


As we head for the International AIDS Society Conference in Amsterdam from July I, please shed light on what the Foundation is doing in regard to kids who are being born by mothers with HIV?

So HIV as a whole is one of the biggest programmes at the foundation. The other two that are very large are malaria and polio. And so we are supporting a wide range of activities to reduce the AIDS epidemic, including the mother to child transmission. For advocacy, we're the biggest funders of a thing called One; for bringing in the private sector, we're the biggest funder of a thing called Red, both of those we work with Bono on. We're by far the biggest supporter of the Global Fund, the nongovernmental supporter of the Global Fund, and working very closely with Global Fund on their programmes.

There are specific groups that are working on the mother to child that we have funded over time and those numbers have been brought down. It's unfortunate that in a lot of countries it's still not down to zero, because if you get the woman and you give the full regimen now, which is the full ARV regimen, not just the single drug approach that was used for a long time, the chance of transmission is greatly reduced at the time of delivery.

And then there's other tools to try and avoid transmission through breastfeeding. I haven't looked at how much the numbers have come down this year, but I know it's been harder to get that down to zero than we expected, and Global Fund has that as one of its top priorities, because it's in some ways even worse than all the other forms of transmission.


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