World Bank to triple health lending to $3 billion

GENEVA Thu Feb 5, 2009 10:44am EST

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GENEVA (Reuters) - The World Bank expects to triple its lending for health programs to $3 billion this year to mitigate the impact of the global credit crisis in poor countries, senior officials said Thursday.

"The health sector is particularly badly affected," Julian Schweitzer, World Bank director of health, nutrition and population, told reporters in Geneva.

Some developing countries' health budgets are shrinking, while currency devaluations in some mean that imports of drugs are more costly, he said. Remittances from workers living abroad are also normally lower during recessions.

"World Bank lending for health will be up from just less than $1 billion to $3 billion this year," Schweitzer said, referring to its financial year which ends on June 30.

Joy Phumaphi, the World Bank's vice president for human development, urged donor countries to honor their foreign aid commitments for health during the slowdown.

"This financial crisis could unravel many of the hard-fought gains in health over previous decades unless we all hold the line on the flow of development aid and health spending," she said, estimating that for every 1 percent drop in gross domestic product, 20 million additional people are pushed into poverty.

"What this means for households is that they will have even less money available for health," said Phumaphi, a former health minister of Botswana. It can take up to 10 years for health services to recover even to pre-crisis levels, if services are reduced, she warned.

The World Bank officials were speaking at a meeting of the International Health Partnership, launched in September 2007 to expand health services in developing countries.

That program aims to increase the volume of long-term predictable financing for results-oriented health strategies. It is supported by the World Bank, World Health Organization and Bill & Melinda Gates Foundation.

Ivan Lewis, Britain's international development minister, said his government would devote 450 million pounds ($657 million) over the next three years to support plans in eight IHP countries. "Now is not the time to retreat," he said.

(Reporting by Stephanie Nebehay)

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