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Economic impact of increased aid flows for HIV/AIDS in developing countries
Author: Compernolle, P. 
InfoShare Partner: Royal Tropical Institute, Department of Development Policy and Practice - Health area
Publication Date: December 2004
Update Date: May 2005
Type of Document: Article/Report/Paper
Topics: Financing/management, HIV/AIDS, general
Region: Global
Language: English
Additional information: There is a perceived tension between the economic rationale for increased investment of human and financial resources to tackle the impact of AIDS, and the potential economic implications of such increased aid flows. This briefing note distinguishes between the macroeconomic, budgetary and sectoral implications of increased new aid flows for AIDS. It argues that the discussion about the potential negative effects of increased aid flows for AIDS should focus on the credibility and predictability of donor financing, rather than on the macroeconomic problems of absorbing new aid flows. The macroeconomic impact of increased aid flows is manageable and rarely a reason for delaying or refusing stable and predictable increases in aid. However, the way in which current and new donors deal with the national budgetary process is crucial to ensuring effective funding with limited distortion of the economy.
Number of Pages: 6
File Size: 57 KB
File Format: Adobe Acrobat (PDF)

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This briefing note distinguishes between the macroeconomic, budgetary and sectoral implications of increased new aid flows for AIDS. It argues that the discussion about the potential negative effects of increased aid flows for AIDS should focus on the credibility and predictability of donor financing, rather than on the macroeconomic problems of absorbing new aid flows.