Improving Lives:
Health in Africa/A Private Sector Approach

“We need to fi nd ways to make quality health care affordable to our people, and I think we can,” says Dr. Victor Litlhakanyane. “As business people, we understand the markets, are good operators, and can work together with governments to fi nd the right solutions.”

He represents Netcare, South Africa’s largest private health care provider and the lead investor in the continent’s first full public-private partnership (PPP) project in health—a new $100 million national hospital and set of related clinics in Lesotho due to open in 2011. IFC advised the government on development of the landmark project, which is expected to improve public health care considerably while keeping costs low. But IFC’s strategy for health in Africa goes further.

The IFC–World Bank Health in Africa Initiative is a five-year, $1 billion combined investment and advisory program. A true partnership, it involves several other parties including the Bill & Melinda Gates Foundation, the African Development Bank, German development finance institution DEG, and donor partners such as France, Germany, and the Netherlands.

The initiative has many parts. One is a new private equity fund designed to increase underserved Africans’ access to high-quality affordable health services. The fund manager, London-based Aureos Capital, is being compensated for its development impact as well as financial performance. IFC recently invested $20 million in the $65 million fi rst closing of the fund, which is expected to reach $300 million in time.

The initiative also involves work to improve smaller health care companies’ access to long-term loans, and teaming with the World Bank and others to help governments harness the private sector to reach national health targets. It has now been formally engaged to advise the governments of Ghana, Kenya, Mali, and Nigeria on ways to bring existing private sector players into their health sectors to target priority needs.

South Africa’s Financial Mail newspaper has called the Lesotho project “a showcase of what PPPs can do.” In time, the IFC-led partnership for health in Africa will bring many more good stories like it to tell.