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How Private Capital Can Help Sustain Our Commitments to the Developing World

Posted: 26/01/2013 00:00

On the face of it, my visit this week to the World Economic Forum at Davos couldn't be further removed from the trips I made to Tanzania and Ghana last year. The contrast between the wealthy and influential individuals represented here, those who have successfully utilised the levers of power and global capital, and those in the developing world whose lives remain blighted by poverty, disease and instability is stark. But what connects many of those assembled at Davos with the poorest people on the planet is a desire to change lives.

There is, however, an opportunity to do more and to transform mere good will from this summit into the action that will make a real difference to children. I am here in Davos to make sure that the voices of the world's poorest and least powerful people are heard by this international audience of innovators and thought leaders.

On Friday, I attended an event hosted by the GAVI Alliance, whose mission is to save children's lives and protect people's health by increasing access to immunisation in poor countries. GAVI's work is one of the most successful examples of how public-private partnerships and market rigour can work to deliver both effective outcomes and value for money.

The focus of Friday's event was to build on this success and to showcase innovative finance mechanisms, including the UK-backed GAVI Matching Fund. The Fund invites corporate partners to make contributions - either in cash or expertise - which can be matched pound for pound by either the UK Government or, for non-UK companies, the Bill & Melinda Gates Foundation. The money GAVI receives is used to purchase vaccines for children in the world's poorest countries and pledges of core business expertise help us strengthen supply chains to ensure vaccines reach those who need them.

Evidence for the success of these funding models can be seen in the outcomes delivered by GAVI programmes. Since 2000, GAVI has helped to immunise 370 million children, saving around 5.5 million lives. Providing current levels of support can be maintained, GAVI estimates that they can save a further 4million additional lives by 2015.

As a former treasury minister, I understand how markets can be used to benefit people around the world. This principle was one of the driving factors behind the radical overhaul of the UK's approach to aid that occurred while I was in Government. We recognised that public funding, and specifically aid, alone could not solve all of the challenges faced by developing world countries. There was a clear need to harness private sector capital and expertise to create sustainable, long-term solutions. We also started to consider aid and development funding as an investment in creating the healthy, resilient and prosperous communities which would become our trading partners of the future.

It was with private sector engagement in mind that the UK Government proposed and led the development of another successful GAVI financial instrument: the International Finance Facility for Immunisation. IFFIm is a mechanism which leverages investment and secures revenue streams for immunisation projects which are needed now. The success of the IFFIm has been spread around the world and it has proved particularly popular in Japan where 'vaccine bonds' are seen as an excellent ethical and financial investment by families and businesses alike.

I recently visited Tanzania to see how projects are being implemented on the ground. Whilst there, I was able to meet the very children whose lives GAVI programmes are helping to save. I visited a rural immunisation centre in the foothills of Kilimanjaro, and I was struck by just how grateful the parents of these children are for our support. The vaccines being distributed in that clinic not only save lives but also have a direct impact on improving life chances. Healthy children tend to spend more time in school, perform better in their studies and to grow into more productive adults. But this isn't the whole story. Since 2001, when GAVI and its partners began to work in Tanzania, routine vaccination coverage has increased to more than 90%, with Tanzania's GDP growing from $10.2bn to $23.7bn in the same period.

Despite this excellent work, the scale of the vaccination challenge is significant. Pneumonia - one of the leading killers of children under five in the developing world - is responsible for more than 1.2 million child deaths every year. Similarly diarrhoea is estimated to kill 450,000 children every year, nearly 1,200 children every day. These diseases are preventable, and it is time that we better harness the skills, resources and expertise of our private sector partners to tackle this problem. This week in Davos, GAVI has shown business leaders what an excellent investment immunisation is for everyone.

 
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