February 2017 BusinessDaily; Donors are cutting funding for HIV/Aids projects in Kenya due to the country’s upgrade to a lower middle income status from least developed country and reports of financial irregularities at the Ministry of Health.
The National Aids Control Council (NACC) says the 2015 Kenya’s status change and the view of health sector as corrupt had led to a drop in foreign funding of its projects. This is despite Kenya being cited among countries with “stubborn” new HIV infections.
Some of the top donors that have withdrawn or cut back HIV/Aids funding to Kenya are Clinton Foundation, Belgium’s MSF, Japan International Cooperation Agency, and Britain’s DfID, according to the NACC.
“The components of HIV that they (donors) used to cover is what they have pulled out from,” said NACC deputy director for HIV investments Regina Ombam.
“The inflated costs of procurement brought to light in the Sh5 billion scandal (at the Health ministry) pushes away investors because they see possible cash flow risks. We have to be open around this fact.”
A series of corruption scandals, including an investigation into suspect contracts running into billions of shillings at the Health ministry, has prompted the donors to rethink their funding of medical projects.
The US government through the President’s Emergency Plan for Aids Relief has steadily been cutting funding from $514 million (Sh52.9 billion) in 2013 to $482 million (Sh49.6 billion) last year, a figure NACC projects will reduce further this year.
The setback comes as Kenya struggle to bring down HIV infection rates and cut deaths related to the deadly virus.
New HIV infections are estimated at 77,647 yearly while deaths from the virus are about 53,821 annually.
“The elevated status to a low medium income earner also creates an assumption that we are doing well hence the declining shift in donor funding,” said Ms Ombam.
In 2014, Kenya changed the way it calculates gross domestic product, making it 25 per cent bigger and pushed the country into the continent’s top 10 economies.
That pushed Kenya to the bottom level of middle income states, according to the World Bank’s $1,045 (Sh107, 635) to $12,746 (Sh1.3 million) band.
A higher income ranking meant it might not benefit from some aid designed for the poorest countries, economists warned in 2014.