"It couldn’t be more clear,  This is the most successful institution that we have in the world

for addressing the most horrific epidemics that the world faces.  We have explicit policy

pledges, we have validated national plans.  We have a clear commitment that all valid plans

will be fully funded.  We’ve already broken that pledge to the world’s poorest people. We’re

delaying programs.  We have a massive gap, and it is the responsibility of world leaders

to face up to this."

- Jeffrey Sachs

January 29, 2009 12:00 pm ET

Joanne Carter: Thanks for joining today’s media conference call to discuss the future of the Global Fund to Fight AIDS, TB and Malaria in a time of economic crisis.

Our speakers today include Rajat Gupta, Michel Sidibe, Peter Chernin and Jeffrey Sachs. The Global Fund is arguably the most innovative, far-reaching, results-driven health financing mechanism in existence. In 2007 the fund’s board, and Rajat Gupta will say more about this, and that included donors and implementing governments, agreed that the fund should grow to a size of $6 to 8 billion by 2010 if countries put forward technically sound, high-quality AIDS, TB and malaria proposals that could reach these levels. And the G8 leaders, meeting in Germany that same year, reiterated that goal of tripling the size of the fund.

And as you’re going to hear in a moment from our speakers, affected countries have stepped up to the plate, are crafting bolder plans than ever to save lies, and demand is strong.  The Global Fund has met with unprecedented success and as the chair of the board will tell us, there are clear, powerful plans to continue to grow.  The Global Fund doesn’t plan to pull back, yet in many ways, as a result of this success, the Global Fund faces a $5 billionfunding gap between planned scale up and current pledges.

We’re here today to send a very clear message that the global economic crisis cannot be allowed to derail this ((inaudible)).  Donor countries must not use the current economy as an excuse not to fulfill live saving commitments and ensure the continued success of the Global Fund.  We urge governments to keep their promises and fill the $5 billion gap with new pledges.

Now, I’m very pleased to introduce from Davos, Rajat Gupta, Chair of the Board of the Global Fund to fight AIDS, TB, and malaria and senior partner worldwide emeritus of McKinsey & Company, who’s going to walk us through the financing gap faced by the Global Funds, but also the Global Fund’s plans for bold expansion.  Rajat, please go ahead.

Rajat Gupta:  Thank you Joanne, as you can well imagine the mood certainly in Davos is in an economic crisis, but I just want to say that all is not doom and gloom.  We have tremendous successes to celebrate, particularly in global health, although we have a long way to go.

In November 2008, at the last board meeting, the Global Fund approved financing for $2.7 billion to fight AIDS, TB and malaria.  This was the largest round that we have ever done, tripling in demand and proof that the Global Fund’s model of country ownership and performance based funding was very much working.

The Global Fund has moved from an environment of constrained quality demand, in our early years when we were struggling to make sure that right kind of proposals that could be implement could have impact were coming forth to now an environment of constrained funding.  We are expecting this high quality demand to continue as we have worked with many of our partners and many of the countries to create this kind of quality demand.

We expect that the next round of proposals will be $2 to 3 billion.  Currently we have only about $1 billion and leaving a shortfall about $1.6 billion, we estimate. 

Also, in 2010 – that was for 2009, we’re likely to need the same amount for piloting national strategy applications and to finance round ten, and we will need another $2 to 3 billion for renewals of existing well performing grants.

So that brings us to a total of about $8 billion need and currently we have about $3 billon available with $900 million earmarked for ‘09, which if you look at the overall picture, gives us a gap of about 5 billion.

Now, clearly the Global Fund isn’t in economic crisis, we have in a sense a very good crisis, it’s a different kind of crisis than the economic crisis.  The crisis is as a result of a very successful investment strategy that has provided us quality demand and extraordinary impact already.  These needs very much are in line with government commitments to grow the size of the Global Fund, as Joanne said, to $6 to 8 billion by 2010. 

At the same time Global Fund is not immune, of course to the environment today and the global financial crisis.  I am hopeful and confident that donors will continue to finance these long term investments in global health that relieve human suffering.  But donors will be looking out also to ensure that their investments are cost effective and have demonstrated results.

In this economic climate, investments will be scrutinized, we all need to tighten our belts, we need to get the most for every dollar we spend.  I believe that when donors really look at the Global Fund they will see high value for their investments.  In an economic crisis, how do we respond?  We do tighten our belts, we rethink the systems, we focus on return on investment.

The Global Fund is doing just that.  In the last round we tightened our belts requiring a 10% efficiency savings in all newly improved programs and existing grounds.  We are rethinking the systems by moving away from a project style approach towards holistic national disease strategies.  And the Global Fund offers donors a strong ROI with a performance based funding framework and a solid track record in getting results and demonstrating impact in the fight against these three diseases.

We are making real progress in the fight against AIDS, TB and malaria because of the resources provided by the Global Fund.  Now, it is time for doners to increase their investments for global health in instruments that have proven they achieve results in a very a transparent and accountable manner.

Joanne Carter:  Next, I’m very pleased to introduce, Michel Sidibe, the newly appointed Executive Director of the Joint United Nations program on HIV/AIDS, UNAIDS to give us his perspective on the importance of the Global Fund in the context of universal access and the fight against AIDS.  Michel, please go ahead.

Michel Sidibe:  Let me build on what my colleague Rajat has said.  I have three key points. 

First, let me begin by acknowledging the unprecedented economic crisis.  I was just coming from Netherlands reading a newspaper and you can see the situation is very bad, but what is very important for me is to also underline the fact of that many countries today are making serious adjustment, macroeconomic adjustment, reforming their system to fit to the new world. 

By doing that, I am scared that if we don’t work strongly to make sure that those adjustments are made with human faith in our mind, we will have  major, major problems in the future.  Because we cannot abandon the constituency of 4 million people on treatment or break the hope of 12 million AIDS orphan or not reaching the millennium development growth for the poor.  So I want to say that any adjustment should really keep in mind this human faith and bring the people to the centers.

Second, we must invest like Rajat said, in mechanisms that work to reach our universal access groups.  The Global Fund is an effective partner.  Without the Global Fund we would not have the result we have seen already.  The Global Fund alone has now seen 2 million people on treatment.  It is a proven and innovative mechanism for delivering resources to communities that need them.

Countries will rely on the Global Fund to fulfill the 2006 commitment to achieve universal access to prevention, treatment, care and support by 2010.  We need a fully funded Global Fund.

Third, I want to stress the need for mutual accountability.  International and domestic commitment must be met for us to continue to make development gains.  We must also make the money work better for people.  Programs should be cost effective, more efficiency in service delivery, and we have to reduce unit costs of doing business. 

I think one of the major challenge we will have to face is to rethink completely with the global financial architecture in order to make sure those million of (wasteless) become part of the process of change. 

Joanne Carter:  Now it’s my great pleasure to introduce Peter Chernin, President and COO of Newscorp and Chair of – Chairman of Malaria No More.  Peter is also joining us from the World Economic Forum at Davos.

Peter Chernin:  Thank you, Joanne, and thank you ladies and gentlemen.  I am here in Davos with Rajat and clearly the global economic crisis is on everybody’s mind.  But the other thing I think that’s interesting in Davos this year is that for the first time, I think we are seeing malaria move to the forefront of the global health discussion here in Davos and I think that echoes what’s been happening over the past 6 months with malaria, where I think malaria has gained an enormous amount of attention.  And the reason I believe that’s true is that, particularly in a time of economic crisis, I think malaria represents one of the great opportunities for some ways a return on investment.

Malaria control probably gets the best bang for the buck of almost anything you can think of global health.  And in those terms, by far, by enormous margin, the most important tool in fighting malaria is the Global Fund.  The Global Fund just announced in its most recent rounds an unprecedented $1.57 billion in malaria funding, which I think represents a two to three times increase of what it’s ever funded before.  And I think that’s for two reasons, one is I think that the Global Fund in this environment really wants to get a bang for its buck and wants to make sure that there are clear results.  And I think also that we made enormous progress in having countries submit ambitious high quality proposals to dramatically scale up access to essential malaria interventions.

And I think the good news here is the Global Fund supported programs are showing real results.  In just the last 2 or 3 years, programs that the Global Fund has supported have shown enormous declines in malaria cases in childhood deaths.  For example, in Rwanda, in a program largely funded by the Global Fund, we saw a 66% drop in malaria deaths in one year.  In Eritrea, I think it was an 80% drop in deaths in 5 years.  Zanzibar we’ve now seen malaria prevalence drop to just under 1%, along with many other successes and so, I think what we’re seeing is that malaria programs led by funding from the Global Fund are showing some of the greatest results in the public healthcare sector.

You know malaria costs Africa about $12 billion a year in lost productivity, and just a fraction of that investment, we can end malaria deaths and remove a major obstacle to economic development.  So this is obviously a humanitarian issue but I think also shows great economic return.

And I think one of the reasons that we’re spending a – one of the things we’re doing here in Davos and Rajat and I and some others are really trying to galvanize the private sector.  Trying to galvanize the private sector, so it’s not just government supporting malaria and supporting the Global Fund, but also trying to get the private sector to think with the same sort of rigor that they think in their investment decisions and business things, to apply that same rigor, that same sort of demand for results into their pro bono and pro social activities.  And so one of the things we’re doing here at Davos, we’re having a number of panels in addition to a panel that Rajat’s hosting.  We’re also launching a malaria capital campaign that Rex Tillerson, the CEO of ExxonMobil and Peter Sands, the CEO of Standard Charter Bank and I will all be chairing.

Again, an opportunity to bring unprecedented private support to malaria and to the Global Fund.  And I think what we’re trying to do is bring these kinds of business skills in an effort to break through the bottlenecks, to improve the supply chain management and to provide a focus on logistics to have an impact.

So, I think just to echo what’s been said, in this global economic downturn, it’s obviously tempting to scale back funding of global health efforts and I think that would be exactly the wrong strategy.  I think that the success of the Global Fund heretofore is begin to – has identified what works and I think we should continue to fund what works, fund it robustly and make sure that we continue what I think has an opportunity to be a great global health victory.

You know I’d just like to quote in closing you know in his inaugural address, President Obama made it clear that he is looking for programs that work.  I think he said where the answer is yes, we intend to move forward, where the answer is no, programs will end.  Well, funding of global healthcare and funding of malaria control programs is a perfect example of programs that work and the most effective way to do that is to continue to support the Global Fund.  Thank you.

Joanne Carter:   I’m going to ask Jeffrey Sachs, Director of the Earth Institute at Columbia University and Special Advisor to the U.N. Secretary General to provide some perspective both broadly on the need for investing in global health in a time of economic crisis and also the importance of donors keeping their pledges to the Global Fund.

Jeffrey Sachs:  The Global Fund was established in 2001 and it was established on a very specific promise of the richest countries and of the poorest people and the promise was that if the Global Fund delivered, all valid programs would be funded.  And this was repeated by world leaders every year.  We were not to turn down approved programs.  They have violated this pledge.  They are in bad faith right now and it’s a very deep crisis.  The promise is that malaria will be comprehensibly controlled with a comprehensive coverage of bed nets by the end of 2010 and essentially reducing debts from malaria to near zero by 2012. 

The world is supposed to be implementing a global stop TB effort, which the scientific community and national policy makers have elaborated.  The world is supposed to be guaranteeing universal access to antiretroviral medicines by the year 2010.  These are three explicit, repeated commitments of the international community.

The Global Fund is the main vehicle for implementation.  It is by far the most successful public health initiative in recent history.  It has done exactly what it said it would do, which was to fund valid programs, track the results and scale up.

Now, the countries have responded with scaling up.  They’ve responded to the pledges for comprehensive control of AIDS, TB and malaria.  They submitted plans in round eight.  And the Global Fund did not fully fund the approved plans.  It already cut by 10% the budgets for the approved plans and it’s warned that it would have to cut by 25% the second half of those plans.  It also postponed round nine for several months, which puts at risk the malaria control effort.

This is absolutely in violation of the life and death pledge that the rich world has made.  Now, we’re talking about a few billion dollars and millions of lives.  Can we find that money in an economic crisis?  Well, look at the “New York Times” front page today, reporting the Wall Street bonuses for this Christmas in the middle of this catastrophe of $18.4 billion.  That’s $18.4 billion bonuses in an industry which lost $35 billion this year.  Those bonuses are in no small way being paid out of the TARP bailout fund.  Is the money there?  Yes, the money’s there.  If we would open our eyes to the reality of broken promises and unbelievably egregious practices, we could easily channel money that is now going into these enterprises and right into private pockets.  Into the mouths and therefore the lifesaving interventions for millions of people.

Last week it was revealed that Merrill Lynch, in a quarter in which they lost $20 billion, had taken $4 billion of bonuses.  Well, that’s enough to close the U.S. contribution that’s missing right now from the Global Fund.  So, I would suggest that the administration reclaim those bonuses which absolutely are not only unjustified, but completely unconscionable and put the money into the Global Fund immediately. 

There is no shortage of funds at a moment when in 3 months the rich world has found about $3 trillion of funding for bank bailouts and in which there have been $18 billion of Christmas bonuses for Wall Street supported by bailout legislation.  I hope that nobody could think that these could for one moment balance the lives that are stake. 

It couldn’t be more clear,  This is the most successful institution that we have in the world for addressing the most horrific epidemics that the world faces.  We have explicit policy pledges, we have validated national plans.  We have a clear commitment that all valid plans will be fully funded.  We’ve already broken that pledge to the world’s poorest people.  We’re delaying programs.  We have a massive gap, and it is the responsibility of world leaders to face up to this and I’ve suggested at least one area where they could make up all of the difference in very short order.

Joanne Carter:  Thanks so much, Jeff and I just echo what you’re saying by saying that the world now has a chance to actually get back on track now that we know that the demand is there, governments can and must come together to actually fill this $5 billion gap for the Global Fund.

I’ll also note that many donor governments have indeed made multiyear pledges to the Global Fund, but as our speakers have said, country demand and the fund’s success have actually outstripped these initial pledges and donor governments have to come together to fill this gap.

In the case of the U.S., it’s clear that the U.S. has not done its part so far.  And part of this gap comes from the fact that the U.S. contribution from the Bush administration for this year that was proposed is about $1 billion less than our fair share, which means that pledges from other donors that should be available for the future are not.  We don’t yet have a U.S. pledge for next year, but the U.S. fair share is estimated to be $2.75 billion.

Again, echoing what our speakers said, the Obama administration has called for government to take responsibility and protect the weakest in times of crisis and the Global Fund is exactly that kind of bridge of solidarity between the rich and poor and it’s also a multilateral channel where renewed U.S. leadership can make an enormous difference.  This moment of economic crisis is a turning point and we hope that the Obama administration will take a close look at the Global Fund fits so closely into the President’s vision, as Peter Chernin said so well, multilateral, inclusive, transparent, bringing public,and private sectors together.  It’s exactly the kind of multilateral effort that Mr. Obama spoke about in his inauguration.  Not about big or small, but about what’s worked.

And derailing this progress now would be disastrous for millions in the world. 

Operator: We will take our first question from Howard LaFranchi with Christian Science [Monitor]. 

Howard LaFranchi: I’m wondering is there anything planned in the way of a meeting or a summit, something where this message would get out?  It seems like very often it takes some kind of meeting in New York, Geneva, somewhere, to kind of embarrass countries maybe into either fulfilling their pledges or to coming up with more. 

And I’m wondering how this message is going to get out and if there are any aside from through the press.  But – and if there are any you know major meetings planned.

Rajat Gupta:  Yes, this is Rajat Gupta; let me just respond by saying that as I said earlier, we had a very, very successful replenishment conference in Berlin where you know roughly $12 billion of pledges are made and now we are going to have an interim replenishment conference in Spain in April which will serve that purpose where we will be you know in a sense having donor representatives from all the big donors and so on in the private sector and foundations et cetera and we will lay out in more depth both the impact of the fund as well as the needs of the fund and hopefully this will bring together the coalition to increase the funding as we just talked about.

I don’t think there is one magic bullet.  I mean you need to have meetings like that.  You need to have specific approaches to the Obama administration, to the new congress, to various capitals around the world.  But I would underscore that at this point in time we need the U.S. leadership because you know right now, I think the U.S. is lagging behind and one of the good things that has happened before is that each country or different countries have kind of egged each other on to do more and now it’s U.S.’s turn to, I think, step up and get that going.  But we are going to have a meeting like what you are suggesting.

Jeffrey Sachs:  If I could just add to Rajat’s point. I’m working through official processes to have this on the G20 agenda as well for the G20 meeting in London in April.

Operator:  OK, we’ll take our next question from Kate Heartfield, Ottawa Citizen.  Please go ahead.

Kate Heartfield:  Hi, thanks for taking my question.  I believe it was Peter Chernin who mentioned the cost of malaria on African productivity and I wonder if he or anyone else could speak a little bit about the knock on negative effect of that one the world economy at a time like this, if there is such an effect.

Peter Chernin:  I think first of all, just on an isolated basis, that alone I think is worth making the investment.  But to me, more than anything, it’s a case of lost opportunities.  You know, I think it would be a huge mistake/sin on the part of the world to write-off this continent and there’s enormous human capital, people willing to work hard, people willing to make major contributions to society and the fact that you know a million of these children are dying every year before the age of 5 there are potentially great leaders and great contributors to the world. 

So I think just on a stand alone basis the cost inside Africa is enough to galvanize us.  But I think as is the fact with frankly all of these diseases I think it would be a huge mistake for the world where in a world in which the only thing of value we have is human capital not to do anything we can to maximize that capital and we certainly shouldn’t write off a continent in terms of future opportunities. 

Jeffrey Sachs:  If I could add one thing, the number that Peter mentioned of 12 and probably even much higher than that at current prices of malaria are the direct immediate losses, but studies including studies I carried out over the years and the World Bank and others show that it’s not only the cost of the disease in a year but it’s the debilitating effect of the disease on economic growth which has the long-term cumulative effect. 

So Africa right now is poorer not merely by 12 or $20 billion a year because of malaria but by perhaps $100 billion a year less than it would be.  In other words, it’s impeded fundamental economic growth on the order of about 1 percentage point of growth per year.  This is a major booster to development to get these diseases under control.  

And not only in the avoided costs of treatment and losses of productivity in a given year but of higher economic growth, which really speaks to your question. 

For Africa to be a full trading partner, one that could be picking up the slack by buying our goods and being a full productive part of the world economy requires that these diseases be brought under control and it was indeed that realization that was at least one of the many aspects including the humanitarian and security aspects that led to the creation of the Global Fund in the first place. 

Rajat Gupta:   I would say the same thing about AIDS and tuberculosis. 

You know you just – and bring it down to the individual level, as Michel Sidibe said you know the number of people coming on ARV treatment you can see the difference before and after where we convert them through this treatment to productive members of society and have an extraordinary contribution economic as well as social.  We prevent all from coming into society at an extraordinary pace.  All of that has a great economic effect but obviously extraordinary social impact.  And may I even add you know the stability and security of societies. 

Peter Chernin:  I think there’s one more final ricochet effect which is these diseases are such an overwhelming burden on the healthcare systems of these countries, that if we can lesson the burden from AIDS, from TB and from malaria it will give healthcare system the opportunity to treat neonatal diseases, treat pneumonia and treat various other diseases.  And so I think there’s a cumulative effect of just you know significantly raising the overall quality of health and healthcare and therefore the economic productivity of this part of the world by really attacking these three diseases and you know again not to belabor it but particularly led by the efforts of the Global Fund. 

Operator:  We will take our next question from Kristi Heim, Seattle Times, please go ahead. 

Kristi Heim:  Hi, thank you for taking my question.  Could you give us a sense where other donor governments are in their pledges?  And where the World Bank might be falling short?

Rajat Gupta:  I don’t think it will be appropriate at this point to talk about specific.  Let me not, and nor am I fully prepared today – we have very significant number of government discussions that are in various stages.  I think this more will come out in the April meeting.  As I said, we have a replenishment midterm meeting. 

Kristi Heim:  OK.  And if you do fall short, what effects are you worried will happen this year?

Rajat Gupta:  Well, I think you know basically we won’t be able to fund quality programs that come up you know for funding to the Global Fund.  I mean I would say this would have a tremendously negative impact.  It will, in a sense, as Jeff said sort of break the trust between nations and pledges that were made and will have a very negative impact on a humanitarian level in the field and in various countries.  So you know the impact would be obvious if we cannot fully fund legitimate productive impactful programs that are being prepared just now. 

Michel Sidibe:  I want just to add something here, because I personally feel that we should not forget that we pushed the world in 2006 to really come with strong and ambitious plans on universal access.  We have more 130 countries today who have been able to review their own program to identify (their shortcomings), to come with a ((inaudible)) plan that can really help us to scale up the programs.

And if we manage all ready to mobilize the resources which are needed we can even avert 10 million deaths and a 6.5 million new infection which is so important.  I don’t think so we owe it to ourselves.  These resources are needed because we owe it to those people, those millions of people we can save.  We can avoid certainly new infection.  And also avert death.  And I said 10 million deaths which is critical.  Let us not forget that. 

Jeffery Sachs:  And also in light of the question it’s important to stress the cuts have all ready started. 

Peter Chernin: This is a disaster. 

Michel Sidibe:  Yes, I fully agree. 

Joanne Carter:  And I would only add that in very specifically that round 9 is still open.  So we have this huge opportunity to continue building support for strong country proposals.  But we still need $1.6 billion for round 9 and we need additional resources in place so that a round 10 can be launched.  So very specifically those need to be in place to be able to continue the very things that are our speakers have been talking about. 

Jeffery Sachs:  Joanne round 9 was postponed by several months because of this credit squeeze which sets back the implementation of scale up.  This is what’s so frightening about the current situation. 

Operator: And we will go to Howard LaFranchi ,Christian Science Monitor.  Please go ahead. 

Howard LaFranchi: I’m wondering if someone could clear up a little bit now I understand that you’re saying that the U.S., in particular, is behind that the Bush Administration anyway didn’t honor its commitments, it’s pledges. 

But on the other hand, we’ve heard a lot about the – and some of us have written about the added funding that Bush Administration put into AIDS, into malaria bed net programs.  And so I’m wondering, I’m just a little confused there.  Is it that yes, they ramped up their funding but not to the level they pledged or was it just in other programs, not the Global Fund?  I’m just a little confused there. 

Rajat Gupta:  Let me just try to put it in context.  Firstly, I have to say that President Bush’s overall PEPFAR program was one of the truly great contributions of the last administration. 

The thing I have to point out there is that within the overall PEPFAR bill which was only last year expanded to 50 billion for the next 5 years which was a very healthy increase and good, obviously, this has to be appropriated by the Congress which is on an annual basis.  You know in the past there has been a great emphasis on bilateral programs and some of the funding went to Global Funds but the bulk of the funding went to PEPFAR which is also a great partner and works together with Global Fund in the area of AIDS. 

What we have experienced last year is that you know what the administration suggested actually the Congress has increased the allocation to Global Fund or to multilateral channel instead of just PEPFAR. 

So what I’m saying is you know it is an opportunity and I’d really rather stress the opportunity part of it which is it’s a great opportunity for this administration and this Congress to step up and appropriate a significantly increased amount for Global Fund.  This has, in its own right a great contribution from the U.S.  It also has another effect which is that notionally we have the U.S. is about 1/3 of the fund.  And to the extent that the U.S. steps up which is lagging behind its 1/3 fair share, then other countries will be stepping up also.  And we in Global Fund would have a significant point to discuss with other capitals and have them step up too. 

In the past you know many other countries have stepped up and as a result U.S. has fallen behind.  So what we are really hoping for is given the success, given the impact that U.S. administration and Congress would find it possible to fund at a much greater degree, the bill has all ready provisioned in it.  It’s a matter of now appropriating it.

Peter Chernin:  No.  I just think I would echo Rajat’s comments which is you know we had some very successful PEPFAR legislation passed.  It’s now time to get the specific money in the budget.  And to be fair, I personally believe you know the Bush Administration deserves great credit for the dramatic increases in global health spending. 

I think what all four of us are trying to emphasize here is that you know we are a tipping point in that we’ve had so much effectiveness in the past couple of years.  We now have effective programs that have been proved to work.  We’ve formed effective partnerships with various nations and various programs around the world.  And I think what we’re concerned about is in a time of global economic crisis where there might be a knee jerk reaction to slow down.  If anything, now is the time to increase our funding. 

And I think you know almost I’d put it we’re a victim of the success that we’ve had over the past couple of years in both demonstrating results and demonstration that AIDS medication works, the malaria bed nets work.  That we can have a big impact on TB et cetera.  That the Global Fund is a good way to deliver these partnerships with various local programs and local governments.  And now more than ever it’s more important that we increase the funding to keep up with the opportunities we have to fund really valuable well thought out professional programs.

Jeffrey Sachs:  Maybe I could add one more point to this which is that the U.S. along with the other donor countries not only pledged to support all valid programs and that’s something that now has been broken and very worrisomely and tragically.  But the U.S. along with the other donor countries pledged to make efforts to reach the target of 0.7 of 1% of GNP in aid.  That was a pledge made in 2002 by the Bush Administration. 

Several other donor countries are on track to do that.  The United States is not only not on track it’s fallen back to become the donor with the smallest donation as a share of income of all the rich countries.  We’re at 0.16 of 1% of our income goes for development assistance.  It’s the lowest level of all 22 donor countries.  And this is also in violation of the promise that President Bush subscribed to in 2002 at an important meeting in Monterrey, Mexico. 

So we have a national responsibility not only with respect to the Global Fund and with respect to these three diseases, but with respect to the poorest countries in the world more generally that is unfulfilled right now and we’re all hoping and expecting that the Obama administration is going to make good on the national commitments.   

Operator:  We will take our next question from Neil MacFarquhar, New York Times.  Please, go ahead. 

Neil MacFarquhar:  Yes, I’m sorry.  I’m a little bit lost in the math here and if someone doesn’t want to go into in great detail and hold everybody up and explain to me on the side, that’s fine.  But I guess there’s two points. 

One is that is the gap from you came up with plans that you would like and you were hoping that countries were going to pledge this and they’re not?  Or the countries said we will meet so and so and they’re not meeting donations that they said they would.  Joanne said at some point that the U.S. should be expected to be pay $2.75 billion, I think, she said.  And I just don’t understand where that expectation is coming from. 

Jeffrey Sachs:  Neil, there are two things.  One is that the design of this whole institution and a marvelously successful one is that countries submit plans and then they are vetted according to scientific criteria by an independent review.  And that all plans that meet the scientific scrutiny which includes administrative management capacity to deliver as well as the appropriate epidemiological and intervention based strategies will be funded.  So there is all ready a serious inability to fund approved programs with a (yawning) gap ahead.  This is the basic point.  That it was all ready broken in round 8, that all of the scientifically approved plans could not be funded. 

Rajat Gupta:  Jeff, you are technically right but I’d like to say two things about this.  One is that in the history of the fund, so far, before round 8 we were able to fund everything. 

That we were able to fund everything that was proposed.  In round 8 we were 10% short because we don’t fund anything unless we have the money in the bank. 

Now, it is also my view as Jeffrey and I see a lot of – and I talk to the TRP and so on is that as you can imagine, as most of us in the private sector would know that in any proposal like that, there are probably without reducing at all the effectiveness of the impact, there could be 10% squeezed out of these proposals. 

And in the time of economic crisis I think it is our responsibility to make sure we get the maximum bang out of each dollar.  So I don’t believe we have as yet you know not funded anything that should have been funded.  However, I share with Jeff the idea that we are in serious risk of doing that that’s why we are being proactively going after raising more resources and making sure that the message goes out to various governments especially the U.S. that we are in dire need and here’s a big gap. 

Joanne Carter:  If I can also add to the specific question that you’re asking.  I think just to reiterate that the Global Fund board and Rajat, you can certainly speak to this but the Global Fund board both donor and implementing countries made a commitment that if demand was there that they were endorsing a Global Fund size of $8 billion and that that was reinforced by the G8 in Germany.  And so the number – the question you had about the 2.75 billion estimate of what we would call U.S. fair share at roughly 1/3 of the funding needs for 2010 is based on what Rajat walked you through earlier which is that in the estimate for the upcoming round and for renewals and for some of these important actually new Global Fund mechanism like national strategies.  So it’s based on that. 

And I would argue a pretty maybe not conservative but very reasonable estimate of what country demand will be.  And so that’s where that number – that estimate comes from of the 2.75 and we’re glad to, if it’s helpful to walk you through that further offline or share more details. 

Operator:  We will take our next question from Steve Secklow, Wall Street Journal, please go ahead. 

Steve Secklow: My question is how much cash the Global Fund been getting from the private sector and I don’t mean in kind contributions.  I know that you have that Project RED going on, I’m wondering how much money you’ve gotten from that.  And why – I know right from the beginning Kofi Annan had said they expected a lot of money from corporations and I know you didn’t get it for a number of years.  I’m wondering if that’s changed at all. 

Rajat Gupta:  Let me just say that Project RED is a very significant contributor.  It grows every day.  But it’s somewhere in the vicinity of 150 million.  And we have launched a program called the Corporate Champions Program in which some very significant donors we partner with.  And the first corporation to step up was Chevron with a $30 million pledge.  And this is what Peter and (Phyllis) from Exxon and Peter Sands from Sanna Charter are about to launch here in Davos.  Peter you want to say a little more about the capital campaign? 

Peter Chernin:  Yes, I think it’s for exactly this reason that we think that it’s important that the private sector step up and play their role in addition to the governments and that there’s an opportunity to help bridge some of this gap.  So we are launching a $100 million malaria capital campaign which we’re actually announcing tomorrow, (Rex) and Peter and I specifically aimed at trying to get the capital sector to put money into malaria and most of that money, not all of it but most of it will go directly to the Global Fund.  And some of it will also go to sort of help Global Fund recipients with technical assistance, some logistics and you know some internal marketing inside Africa to make people utilize the nets and the services available to them.  So it’s a very significant effort to increase the amount of funding from the private sector to go to the Global Fund. 

Steve Secklow:  Maybe we could get some of the Wall Street bonuses in there. 

Operator:  Yes, we will go to Jon Cohen, Science Magazine, please go ahead.  

Jon Cohen:  I wanted to put a finer point on the question that many other people have raised.  The U.S. government law passed last year says up to $2 billion a year going to the Global Fund.  So are you asking that they appropriate that entire amount every year?  And then an additional $0.75 billion? 

And my other question has to do with the gap if the U.S. government does this, does that alter the $5 billion gap that you’re pointing out?

Rajat Gupta:  Well, we are well short of the $2 billion right now.  So if the Congress appropriated 2 billion for 2009 and 2010 it will go a long way.  As I said, there’s a notional idea that U.S. is 1/3.  So if U.S. did 2 billion we would get 4 billion from other sources to make it a 6 billion annual funding available for good programs.

Let’s be clear.  I mean this money is only spent if we find the right kind of programs.  And we have been working very hard, as Jeff said, very technically sound implementing actionable programs.  So I think that you know it’s a – I don’t want to today argue whether it should be 2 billion or 2.75.  If it was 2 billion at least for the next two years I would be very happy and we would close that $5 billion gap in the two years if U.S. did 2 billion each year and we got commensurate update from other governments. 

Joanne Carter:  And the only thing I would add is that the legislation was specifically crafted to say in FY ’09 up to 2 billion which we’re far short of that right now with a U.S. need of somewhere 1.6 and 2 billion.  And we’re quite far short of that even with what Congress added to what President Bush had put forward in last year’s budget but in fact for FY ‘10 and going forward it actually says such sums which would – to allow the flexibility for in fact even increased need for the Global Fund.  And again that estimate that we’ve been calling the U.S. fair share of that 2.7 billion was based on about 1/3 of the total mean which is where the U.S. and other donors have talked about the U.S.’s role.

Operator:  Yes, we will take our last question from Sandi Doughton, the Seattle Times, please go ahead. 

Sandi Doughton:  Hi.  I actually have a couple of questions if you can get to both of them.  The first one is this seems to be directed largely at the Obama Administration have any of you connected with people in the Obama Administration and do you have any idea where they’re leaning on this?

Jeffrey Sachs:  Well, I would say that first of all I think they’ve been in office for all of 8 days and you know struggling a lot.  And I think the early – and a number of us have fairly close relationships with the a number of people in the Obama Administration and have gotten very positive feedback from them during the campaign and were in close touch with them during the campaign.  And you know we will be starting series of meetings and conversations with them fairly shortly. 

But I would say the signs out of the campaign were positive.  Obama’s endorsed malaria spending specifically aggressively and Hillary also and so – or Secretary Clinton.  So you know what I would think we would expect to start engaging them in some depth over the coming weeks.  But I think that the signs out of the campaign were encouraging for us. 

Sandi Doughton:  OK.  And then my second question was for Rajat Gupta, you mentioned something about moving from project style programs to more holistic programs.  Can you explain a little bit about what you meant there?

Rajat Gupta:  Well, I think you know initially when it started we would – the country coordinating mechanism would suggest a specific project and we would fund it.  But as the countries grew more sophisticated and as we required more and more both that it fit in a national strategy and it got coordinate with other programs that may be on the ground, some bilateral programs and other multilateral programs like World Bank.

So the Global Fund started working with the World Bank and the countries.  So these proposals that come forward now are a part of a national strategy towards these diseases as well as a national strategy for overall health systems strengthening.  So that’s what I meant by going from a very project based to a much more holistic approach based on national strategies.

Joanne Carter:  And if I could just add very briefly to what Peter said, that in fact, there have been varying encouraging signals from the Obama Administration and that President Obama on the campaign trail talked about providing, supporting the U.S. fair share for the Global Fund, in fact.  And certainly this is an opportunity for that multilateralism that they have so strongly been talking about.  So this seems like one of the first important opportunities out of the box, and really a move away from where the last administration was in a much more bilateral focus.  And so giving a particular opportunity for this new administration to take this forward and I think the rest of the world is very much looking for signals on that. 

Jeffrey Sachs:  And President Obama was very clear in recent days as was the Secretary of State that the millennium development goals are America’s goals.  And this could not be more clear the way they emphasized that.  And there is no instrument more central to achieving the millennium development goals than the scientifically vetted projects of the Global Fund.  It’s the number one most powerful, most direct instrument that we have to achieve the millennium development goals. 

Joanne Carter:  I see right now that we’ve actually even passed the top of the hour.  So thanks everyone so much for staying on this call and for your interest and engagement and thanks to all of our speakers for your time and for your powerful comments. 

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