Recap
Discussion on Alternative Financing Mechanisms and Debt2Health
Just one day after Federal Minister for Economic Cooperation and Development Reem Alabali-Radovan announced Germany’s pledge of one billion euros to the Global Fund at the World Health Summit—a reduction of around 23 percent compared to the previous funding period, including 100 million euros through the Debt2Health mechanism—we held our jointly organized panel discussion with the Global Fund Advocates Network (GFAN) on the topic “Innovative Partnerships Beyond Traditional Development Cooperation (ODA): Debt2Health.” The event could hardly have been more timely in the midst of the current Replenishment debate.
Debt2Health, launched in 2007 by Germany and the Global Fund, is part of the German government’s Debt Conversion Facility. It allows Germany to forgo repayments from earlier development cooperation loans—up to 150 million euros per year—if the debtor country invests the equivalent amount in mutually agreed projects. Under the Debt2Health programme, these funds flow directly to the Global Fund, which allocates them to health programmes in the respective country, for instance in the fight against HIV, tuberculosis, and malaria. Germany has successfully implemented this instrument in ten agreements so far—an established way to mobilize additional resources for health without burdening the federal budget.
The discussion was moderated by Katy Kydd Wright (GFAN) and Peter Wiessner (Aktionsbündnis gegen AIDS). Following an introduction by Dr. Christoph Benn (Joep Lange Institute), who stepped in at short notice for former Federal Minister of Health Prof. Dr. Karl Lauterbach, the panel featured:
- Dr. Bärbel Kofler, Parliamentary State Secretary, BMZ
- Peter Sands, Executive Director, The Global Fund to Fight AIDS, Tuberculosis and Malaria
- Ms. Dwi Puspasari, Acting Director, Center for Health Intervention Policy, Indonesia
- Kinz ul Eman, CEO, Dopasi Foundation (Pakistan) and Board Member, Pandemic Fund
- Anudari (Anuka) Anar, Executive Director, Youth LEAD Mongolia
- Tilman Rüppel, Board Member, Aktionsbündnis gegen AIDS Germany
In their contributions, the panelists explored the opportunities and limitations of Debt2Health from different perspectives: Germany as pioneer and donor; Indonesia as one of the first partner countries with three completed agreements; and Pakistan and Mongolia, with experiences from more recent programmes.
Between Budget Logic and Global Responsibility
In his introduction, Dr. Christoph Benn highlighted Germany’s pioneering role in developing and implementing Debt2Health. The panel built on this perspective and discussed how the instrument could evolve in an era of shrinking development budgets and growing debt burdens.
Tilman Rüppel opened the discussion by asking what Debt2Health actually delivers—and where its limits lie. He described it as a mechanism that transforms liabilities into development opportunities, while also depending on clear political decisions and careful coordination. The discussion made clear that Debt2Health is not a substitute for traditional ODA, but a powerful complementary tool capable of mobilizing additional resources for global health.
Experiences from Partner Countries
How this works in practice was illustrated by Ms. Dwi Puspasari: Indonesia has so far concluded three Debt2Health agreements with Germany, enabling investments in diagnostics, prevention, and the strengthening of tuberculosis programmes. Puspasari emphasized that Debt2Health provides a reliable and partnership-based framework for implementing national health strategies—provided that coordination processes remain transparent.
From a civil society perspective, Kinz ul Eman described Debt2Health as an effective and credible instrument that can help build trust between ministries of finance and health. Pakistan was the first country to implement a Debt2Health agreement in 2007: Germany cancelled bilateral debt, while Pakistan invested the equivalent amount in HIV, tuberculosis, and malaria programmes, channelled through the Global Fund. According to Eman, this structure for the first time built a bridge between different government departments and enabled civil society organizations to participate in financial and planning processes.
Anuka Anar added insights from Mongolia, where Debt2Health represents one of the most recent examples of civil society participation. She emphasized that the initiative not only mobilizes additional funds but also fosters inclusion: through the Country Coordinating Mechanism (CCM), community organizations were involved in decision-making processes for the first time. In Mongolia, the funds primarily support HIV prevention and awareness among young people and migrant workers—thus promoting both participation and health equity.
To learn more about the situation in Mongolia, we conducted a follow-up interview with Anuka, in which the value of Debt2Health funding for communities becomes powerfully clear: “We were taught to be silent.”
Political Context and Perspective of the Federal Government
Dr. Bärbel Kofler placed Debt2Health in the broader political context of German development cooperation. She stressed that the instrument is an important component of Germany’s engagement with the Global Fund, while also clarifying that it does not replace structural debt relief, but rather serves as a targeted and positively evaluated complement to development financing.
Peter Sands underlined that the Global Fund is ready and able to implement additional Debt2Health agreements beyond the currently pledged 100 million euros. He emphasized that the mechanism is a proven and efficient tool, built on existing structures, oversight mechanisms, and programme pipelines. Debt2Health, he noted, demonstrates how innovative financing approaches can combine impact with fiscal responsibility.
Conclusion
In the subsequent Q&A, it became evident that Debt2Health is not merely a technical financial instrument, but a political tool for shaping policy. The discussion explored how Germany could make more strategic use of its Debt Conversion Facility in the future—for example, by applying the annually available 150 million euros not as one-off contributions, but throughout the entire funding period. Another idea raised was whether unused funds at the end of a fiscal year could be transferred directly to the Global Fund.
In conclusion, the discussion made clear:
Debt2Health is not a replacement for traditional development financing, but a powerful instrument for mobilizing additional resources without creating new debt. For Germany, this represents a significant opportunity to use its existing Debt Conversion Facility strategically—and thereby make an important contribution to closing global financing gaps.
