AIDS Funds Frozen for China in Grant Dispute

The Global Fund to Fight AIDS, TB and Malaria is reconsidering its support for China. A quiet decision in November to withhold payments for a major AIDS grant there has been followed in recent weeks with the freezing of funds for other grants.

Sources say the Global Fund is concerned over China’s management of the grants and its hostility to civil society groups, which the fund considers to be a cornerstone of disease-fighting efforts.

Officials from the Global Fund and China met for two days to discuss the concerns. Fund spokesperson Jon Liden said Friday China agreed to a number of stipulations on how money would be used and monitored. “We came to a point where we needed to make clear signals to China,” he said. “We seem to share an understanding of the way forward.” Sources familiar with the negotiations said China has pledged to repay any funds that have been misspent, though it is not clear whether it has agreed to include nongovernmental organizations in fund-sponsored initiatives.

The meetings took place amid growing questions of whether China should receive Global Fund support at all. China spent approximately $46 billion hosting the 2008 Summer Olympics and last year’s Shanghai Expo, in addition to financing a $586 billion economic stimulus package.

Since 2003, China has received $539 million from the fund, according to the Global Fund’s website; another $295 million is in the pipeline.

China, the fourth-largest recipient of Global Fund aid after Ethiopia, India, and Tanzania, qualifies for grants as a middle-income country, much like India, Thailand, and the Philippines. These nations are expected to contribute a certain percentage to the cost of fund-financed health programs. China has given the fund just $16 million. The United States, by comparison, has contributed $5.5 billion.

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