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Ignoring the Need and Opportunity to Invest in Africa’s Healthcare Providers

According to figures produced by the Health Finance Coalition, only 1% of global health funding is spent in Africa – meaning the continent faces an annual shortfall of more than $200bn. While a large part of the solution to the funding shortfall for health in Africa must come from governments, the need to support the private sector – which largely consists of thousands of small-scale clinics and pharmacies – cannot be overlooked. But, perhaps more surprisingly, ‘impact’ funds – those with a mandate to achieve positive social or environmental outcomes, alongside financial returns – are also shying away from healthcare in Africa. Despite the obvious potential to contribute to the SDGs, HFC figures show that just 1.6% of $500bn invested globally in achieving ‘social impact’ is directed towards African healthcare. Part of the solution to attracting more funding – both from philanthropists that prioritise impact, and from commercial investors seeking market-rate returns – lies in innovative financial structures. Nicole Spieker, CEO of PharmAccess, a foundation that promotes public-private cooperation in African healthcare, explains that a “blended finance approach” relies on certain impact-oriented investors in a fund being willing to accept “first loss”.