The Impact of neoliberal policies on health

International policies responsible for the weakening of health systems[1]

 In the last three decades the international health and aid policies towardsAfricahave been disastrous for health care delivery and universal access. International health policies have resulted in expensive health care for the rich, and fragmented, ineffective services for the poor. As a result, large segments of the population continue to suffer unnecessary casualties, pain and impoverishment.


A look at the history of international aid for health can help us to understand what is happening today. In the 1950s and 1960s, health aid policies forAfricafocused on disease control. The metropolis of the colonies did not see access to health care as a priority. In 1978, a new strategy - Primary Health Care (PHC) - was approved at the Alma Ata Conference. It promoted comprehensive care and community participation in public services. This concept led to several confrontations between World Health Organization (WHO) and multinational companies on breast milk substitutes and essential drugs.


 The 1978 WHO “primary health care strategy” soon receded into the background after theUnited Stateswithheld its contribution to the WHO budget in 1985. This caused a return to the vertical programme strategies of the 1950s for developing countries. Within a year of the Alma Ata conference, the Rockefeller Foundation and UNICEF, among others, were arguing for a reduction in the scope of public PHC to the control of 4–5 diseases, a strategy labelled “Selective Primary Health Care”. Professionals criticised this selective policy on the grounds that comprehensive PHC, with the same disease control objectives but also securing access to health care, incurred the same costs as selective PHC. However, they failed to curb theUSpolicy which soon was supported by the World Bank. 


The World Bank dismissed as irrelevant “the provision of comprehensive health care in public services”. Many intellectuals endorsed this neoliberal perspective. Publications depicted public health care as inefficient. This “scientific guidance” promoted the privatisation of health care via the split of the purchaser (patient) and the provider (hospitals, health centres), the autonomous management of public hospitals, contracting out of services, private financing initiatives and managed care[2]. The Financial Institutions (FMI, WB, etc), donors and bilateral aid agencies conditioned their loans on the acceptance of limiting public health service delivery to disease control (labelled “prioritisation”) and African governments had to accept it.


The World Trade Organization (WTO) enforced the privatisation of health care and opened the developing countries health markets to Western Health Care industries. In 1995 the WTO[3]-GATS[4] agreement (on trade and services) prevented signatory governments from providing subsidised goods and services in the health sector for which there is market demand.


The international development assistance (donors) set up alliances with the private sector who received part of the aid. Most of these alliances were disease-specific, public–private partnerships (PPP), known as “Global Health Initiatives”. In 2004, of 79 initiatives at least 20 were partnerships for vaccines, drugs, etc. Currently more than 100 PPP have initiated dozens of worldwide disease control programmes. The proportion of development assistance disbursed through Global Health Initiatives has increased steeply over the last decade, as has total development assistance for the health sector as a whole, from just over US$ 6 billion in 1999 to US$16.7 billion in 2006. The fastest growth was in funding for HIV/AIDS programmes from US$1.5 billion in 2002 to US$ 8.3 billion in 2006. This displaced the share of development assistance for primary health care which declined from about 28% to 15% over the same period. The result of all that “generosity” has been the weakening of the national health systems necessary for an effective response to health care and prevention of all diseases.


The big donors[5] are creating AIDS/other disease-specific systems that compete for health workers and administrative talent, share the same infrastructure, demand extra-work (reporting requirements) from the public health personnel and create a drain on resources essential to the country's Health System. Global Health Initiatives’ vertically managed programs have the potential to undermine healthcare systems for the people and so exacerbate health inequity.

It is vital that donors and health organizations work to strengthen the national health systems, the only means to deliver access to health care for all.  


The neoliberal reform in Africa

 These neoliberal policies have contributed to the loss of access to health care and have contributed to deepen the problem of the commodification of basic human necessities and this has life-and-death implications for vulnerable populations. Some of the effects of these policies in Africaare:


  1. Cuts in Health Budgets and introduction of user fees. In the 80’s and 90’s, the Structural Adjustment Programmes (SAP) resulted in budget cuts to the health sector and the introduction of user-fees for medical services. The reduction of government health care expenditure further limited the few health care options available to the poor. The result was a tendency for the poor not to access treatment. The tragic consequences of the SAP in the health care services are felt even today. 
  2. Reduction of public services, limiting them to the poor who cannot afford to pay for the services. That increases the gap between rich and poor and weakens public services and the health system.  
  3. Reduction of what is understood by “the common good” by limiting health care to the control of certain diseases while excluding the social determinants of health. Once predominantly providers, governments have become simple ‘stewards” steering care by regulation and supervision. The disease- control focus overburdened first line public healthcare delivery. Disease control programmes financed by Western countries represent a market for the development of new pharmaceutical products by companies that have no interest in a public health market that dispenses mostly generic and essential drugs. 
  4. Privatisation of healthcare services and the autonomy of hospital management. The transfer of public care to the private for-profit sector is at the core of the neoliberal policy.  They even try to work it so that public money funds privatised care. Foreign service providers are likely to target only the profitable sectors or the higher income earners. Privatisation of health services increases inequity of access by favouring those who can afford to pay for health care. It also favours the drainage of professional personnel from the public to the private sector, thus weakening the national health system even further. 
  5. The liberation of health services means that foreign companies must be treated as local companies so governments cannot control the sector any longer. GATS[6] (liberalization of services) is against governments offering subsidised services that the open market also offers; this endangers subsidised public health care services. The public sector will have to compete with the private sector. Liberalisation of health services is on its way inAfrica. International health care companies searching for opportunities to access other markets lobby their governments for health sector liberalisation and GATS is opening the door for them. 
  6. Commercialization of Health care. A market for health care, medical equipment and medicines is being developed. Charitable foundations and some NGOs are often used as means to privatise and develop the market. The healthcare market is a growing and attractive economic sector and an investment opportunity for private actors because of the growing middle class. 
  7. Privatised foreign aid: public-private partnerships (PPP). Donors established disease-specific, public–private partnerships (PPP) with the private sector known as Global Health Initiatives. As was seen above, these partners absorbed a great part of the foreign international aid. 
  8. The strengthening of Intellectual property rights (IPRs) (patents, custom duties, data exclusivity, etc) in Trade Agreements is a barrier to accessing to cheap and good generic medicines. As most health services are paid out-of-pocket, prices of medicines are a critical factor in determining the level of health care. The current patent system delays competition from low-cost generic producers, thus raising the prices of medicines. Generic competition lowers the prices of medicines by an average of 40-80 %. Furthermore, increased IP protection also impedes developing countries from establishing their own pharmaceutical industry. 
  9. Limited or stifled state control and regulation. Deregulation in health prevents African countries from protecting their health services, giving full power to companies while limiting state intervention. 

A “dubious scientific approach” is at the service of these policies that benefit companies and international institutions. Academics supposedly offering “scientific guidance” but actually promoting privatisation depicted public health care provision as inefficient, bureaucratic and unresponsive. Those promoting those policies used all means of publicity and propaganda at their disposal.


Consequences of this policy for Africa

Africa will not reach by 2015 any of the healthcare Millennium Development Goals objectives.


The curbing of public health services to a limited number of diseases has been a failure even in case of those few diseases like HIV/AIDs that have received a lot of investment. The percentage of adults with HIV/AIDs has been more stable since 2000 at 33 million. But there are 2.7 million new infections each year (2007). The incidence of tuberculosis inAfricahas increased by 47% between 1990 and 2007.


InAfricanearly half of the population (48%)still has no access to essential medicines, a far cry from the 2010 target of 100%.


The autonomy of hospital management leads to reserve hospital health care to the 20% of patients that form the middle class.


Money and personnel are wasted due to the bureaucratisation of international aid.


NGOs and other “not- for-profit” organisations have been used, sometimes without their  being aware of it, as an intermediary step between public service and full privatisation thus contributing to the health care market. 


As in the rest of the world, health care costs are the first cause of families falling into poverty inAfrica.


What can be done to strengthen health systems?

 We can:

  • Fight against the privatisation of health care financing in our own country and worldwide.
  • Oppose trade in social services, including health services.
  • Participate in the development of non-commercial health services with a social purpose.
  • Work towards the development of local, integrated health care systems.
  • Participate in professional and socio-political organizations concerned with equity in access to health care.
  • Develop bridges between the academic community and socio-political organisations concerned with the social aspect of health care services.
  • Fight for health research and education independent of private interests.
  • Contribute to the development of professionalism in universities that is currently undermined by a certain “scientism” that is at the service of private companies.

Begoña Iñarra

AEFJN Executive Secretary


[1] Inspired in “Desintegrated care: the Achilles heel of international health policies in low and middle-income countries- by J.P. Unger; P.De Paepe; P. Ghilbert; W. Soors; A. Green

[2] Reduce health care costs through mechanisms such as economic incentives for physicians, increased beneficiary cost sharing, controls on inpatient admissions and lengths of stay, etc.

[3] WTO: World Trade Organization.

[4] GATT. General Agreement on Trade and Services is a Treaty of the World Trade Organization (WHO)

[5] Bill and Melinda Gates Foundation, the Global Fund to Fight AIDS, Tuberculosis and Malaria, and the GlobalAlliance for Vaccines and Immunization

[6] GATS. The General Agreement on Trade in Services is a treaty of the World Trade Organization (WTO) came into force in 1995

Go back