April 22, 2008 — EVP and CEO Lars Thunell told participants at a conference in Stockholm on “Financing the Private Health Sector in Sub-Saharan Africa” that, "The private sector can play an important role in financing for the provision of health care services and goods, complementing the public sector, which alone cannot meet growing demand."
“We are looking to involve and seek buy-in from a range of stakeholders — development finance institutions, policymakers, donors, and private sector — to become partners with IFC and the World Bank in improving health care for Africans,” Thunell said.
A large, untapped market opportunity was identified in IFC’s recent report, “The Business for Health in Africa,” which concluded that the private sector plays a significant role in the financing and provision of health-related goods and services and that the vast majority of private companies in the sector lack access to financing and expertise.
The report predicts that African health expenditure will keep growing rapidly, with the private sector playing a central role. A poor woman in Africa today is as likely to take her sick child to a private hospital or clinic as to a public facility. The private sector is sometimes the only option for health care in rural regions and poor urban slums. Private providers (for-profit and not-for-profit) serve all income levels and have broad geographic reach.
Challenges to Africa’s health sector include limited access to capital, bothersome regulations, a shortage of skilled workers, and a lack of risk-pooling mechanisms that can mobilize revenue for providers.
IFC responded to the report with an innovative strategy, which includes mobilizing — with partners — about $1 billion in investment and advisory services over the next 5 years, including setting up an equity investment vehicle, creating a debt-financing facility, improving the operating environment for the private health sector, expanding the education of health workers, and encouraging the development of risk-pooling mechanisms.
The conference was co-sponsored by IFC and Swedfund International.
Contact:
Ludi Joseph
Communications Officer
Health and Education Department, IFC
E-mail: ljoseph@ifc.org
Phone: 202-473-7700
Website: www.ifc.org/che
