Practical steps to make PPPs work for Africa health systems
DAKAR, Senegal — Public-private partnerships are all the buzz in the African health sector, where financing is in short supply. Just four African countries have met domestic spending targets for the sector, and many see PPPs as a way to plug the gap.
PPPs involve an arrangement between governments and private sector organizations in the delivery of a public good or service. While few dispute their potential, PPPs present a series of political and regulatory challenges. At the Africa Health Business Symposium in Dakar this week, officials and businesspeople met to discuss how they might lay the groundwork for better partnerships.
These arrangements are “a strategy that cannot only contribute to financing, but also help in reforming the health sector,” Zouma Salifou, director of planning research and health information at the West African Health Organization, told the symposium. “Governments can no longer continue with ‘business as usual.’”
The private sector already plays a substantial role in the financing and implementation of health services across the continent. An estimated 60 percent of health care financing in Africa comes from private sources, and about 50 percent of health expenditures goes to private providers, according to the World Bank Group’s International Finance Corporation.
Successful public-private relationships strike a balance between providing a public service and generating a return on investment for the private sector partners. In Dakar, stakeholders discussed concrete policy changes and tweaks that can help, including harmonizing laws among countries to facilitate cross-border partnerships, creating clear regulatory frameworks, and providing incentives such as tax breaks and subsidies to lure private investment.
Regional integration and lifting bottlenecks
The diversity of commercial laws across countries prevents many PPPs from building cross-border interventions. Countries should coordinate to create a more enabling environment, Dr. Amit Thakker, chairman to the Africa Healthcare Federation, told Devex.
African governments can begin by examining existing laws and analyzing gaps between countries, he said. Africa’s Regional Economic Communities, such as the East African Community and the Economic Community of West African States can serve as platforms to coordinate policies.
The World Bank-funded East Africa Public Health Laboratory Networking Project, for example, is working to strengthen laboratory systems across the region. The East, Central, and Southern Africa Health Community is working with the EAC to share policy strategies to strengthen the network of laboratories across borders.
Simple tweaks can make an enormous difference. One example is reducing duties on raw materials for the health sector and customs taxes on diagnostic services, as well as eliminating fees for work permits for health workers, he said.
The process for registering health commodities should also become more streamlined. For example, a manufacturer producing a health commodity registered in one African nation should be able to sell that product in all of the countries in the region, rather than navigate the bureaucracy and delays involved with registering the product individually in each country, he said.
The private sector would also be more keen to collaborate if governments helped facilitate land permits and licenses, George Uduku, business development manager at Philips Healthcare West Africa, told the conference. Other incentives governments could consider include tax rebates on medical equipment and government subsidies on health commodities, said Mpoki Ulisubisya, permanent secretary for the Ministry of Health Community Development, Gender, Elderly and Children for Tanzania.
Practitioners urged governments to consider building a national regulatory framework on PPPs, rather than working from contract to contract. That could reduce uncertainty in the tender, procurement, and awards process, said Dr. Julius Muia, director general of Kenya’s Vision 2030 Delivery Secretariat, which is an effort to turn Kenya into a middle-income country by 2030.
Kenya, for instance, passed the Public Private Partnerships Act in 2013. The law established regulatory and project development institutions, and outlined the project cycle and procurement methods. It also regulated the tender process, contract award, and implementation phases.
Kenya has about 70 PPPs currently in the pipeline, some of which are in the health sector, said Muia. These projects have been agreed upon by a national government cabinet committee, which analyzes whether they are in the country’s strategic interests. Almost all of the PPPs were initiated by the government, he said.
Governments should also enhance regulatory systems aimed at monitoring the private sector’s service delivery, to ensure that the implementation of the PPP meets national standards, Dr. Marie-Goretti Harakeye Ndayisaba, head of division on HIV/AIDS, tuberculosis, malaria, and other infectious disease at the African Union, told Devex.
Stakeholders need to examine the body of evidence on PPPs in the health sector as they craft policies, Rosalind McKenna, program officer for the Open Society Public Health Program, told Devex.
“Public-private partnerships, as we are currently conceiving of them, are relatively new,” she said. “As we move forward, we need to be very careful about looking at the evidence of the utility of those partnerships and the impact in terms of the resources that they command or whether or not they actually deliver on access for populations, particularly marginalized populations.”
She also urged PPPs to include community members receiving the services in conversations before the projects begin. “The government has an obligation to make sure that actions of other actors are not undermining health rights of its citizens,” she said.
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About the Author
Sara Jerving is Devex’s East Africa correspondent, based in Nairobi. She is a reporter and producer, whose work has appeared in The Wall Street Journal, the Los Angeles Times, Vice News, Bloomberg Businessweek, The Nation magazine, among others. Sara holds a master’s degree in business and economic reporting from Columbia University Graduate School of Journalism where she was a Lorana Sullivan fellow.