|[December 21, 2012]
Groundbreaking Initiative to Catalyze Investment in African Health Care Receives $10.6 Million in Public-Private Financing
AMSTERDAM --(Business Wire)--
An innovative approach that could transform Africa's health care
delivery with private sector financing obtained $10.6 million from the
U.S. Government and a quartet of leading international foundations this
Called the Medical
Credit Fund (MCF), it will enable small and mid-sized health care
providers - clinics, laboratories, doctors and midwives - in Africa to
receive the capital they need to improve their quality. At the same
time, it will use internationally-certified clinical standards to gauge
providers' improvements and a technical assistance program to ensure
that funding is well-spent.
If successful in its initial implementation in Kenya, Ghana, Nigeria and
Tanzania, the MCF will expand into additional countries in Sub-Saharan
Africa, on the strength of evidence that the private sector is already
transforming the continent's health care systems:
According to a recent World Bank and International Finance
Corporation study, the private sector already delivers 50 percent of
Sub-Saharan Africa's health care and 60 percent of its financing, and
has the potential to "bring about significant improvements to Africa's
health care challenges, such as expanding access to health services and
reducing the financial burden on governments." But more expansive use of
the private sector has been hindered by limited access to capital and a
lack of risk-pooling mechanisms.
What makes the project especially innovative is its 'layered capital'
structure. By using philanthropic capital to catalyze much large amounts
of funding from private and public sources that might otherwise stay on
the headlines because of perceived risks, the MCF is able to increase
its developmental impact significantly.
"Involving the private sector more fully in Africa's health care is the
best way to expand access to greater numbers of people - and that's what
the MCF has shown it can do," said OPIC President and CEO Elizabeth
Littlefield. "This new financing will empower smaller providers to scale
up much-needed services, improve clincal standards and thereby
efficiency. OPIC is pleased to team with so many distinguished partners
in this initiative."
The MCF this week concluded financing from the Overseas
Private Investment Corporation (OPIC), the Calvert
Foundation, the Bill
& Melinda Gates Foundation, the Soros
Economic Development Fund, the Deutsche Bank Americas Foundation and
Dutch private investors, as well as grant funding from the U.S.
Agency for International Development (USAID). Total
Impact Advisors LLC advised the MCF on this financing transaction.
Since the start of the program in late 2010, the MCF has disbursed more
than 1.4 million dollar in small loans in Kenya, Tanzania, Ghana and
Over the past years, funding has been provided by Dutch private donors, De
Grote Onderneming, Aids
on behalf of the Dutch Ministry of Foreign Affairs, USAID and IFC on
behalf of the Canadian Government.
The MCF is an initiative of PharmAccess, a Dutch not-for-profit
organization, dedicated to improving health care in Africa through
innovative approaches. The PharmAccess Group mobilizes public and
private resources for the benefit of doctors and patients through
insurance (Health Insurance Fund), loans to doctors (Medical Credit
Fund), clinical standards (SafeCare), private investments (Investment
Fund for Health in Africa) and operational research (Amsterdam Institute
for Global Health and Development).
OPIC is the U.S. Government's development finance institution. It
mobilizes private capital to help solve critical development challenges
and in doing so, advances U.S. foreign policy. Because OPIC works
with the U.S. private sector, it helps U.S. businesses gain footholds in
emerging markets catalyzing revenues, jobs and growth opportunities both
at home and abroad. OPIC achieves its mission by providing
investors with financing, guarantees, political risk insurance, and
support for private equity investment funds.
Established as an agency of the U.S. Government in 1971, OPIC
operates on a self-sustaining basis at no net cost to American
taxpayers. OPIC services are available for new and expanding business
enterprises in more than 150 countries worldwide. To date, OPIC has
supported more than $200 billion of investment in over 4,000 projects,
generated an estimated $75 billion in U.S. exports and supported more
than 277,000 American jobs.
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