1. Situation Analysis

The African continent has the worst health outcomes of any region. But it also has made the greatest gains on most indicators of progress, even as many advanced economies are going backwards.

Life expectancy at birth in Africa has increased by 7% (or 3.43 years) on average each decade since 1960, from about 42 years to around 63.8 years in 2020. Infant mortality fell by more than half between 2000 and 2021. The prevalence of wasting and stunting has been on a downward trend since 2000. Disability-Adjusted Life Years (DALYs) declined by 39.6% between 2000 and 2019.

By 2050, Africa’s population will grow by nearly 1 billion people, to 2.4 billion. It will be the world's largest and youngest population: 49.4% will be under 25 and just 5.8% will be over 65. This rapid population growth will create increased demand for health services, and require a growing economic base to finance them. Increasing investments in health now will be instrumental in unlocking the full potential of Africa’s youthful population.

The World Health Organisation (WHO) recommends that countries invest at minimum 4% to 5% of their GDP on health to achieve universal health coverage. But government health financing in Africa currently averages only 1.48% of GDP, and health spending has risen by just 3% per capita over the past decade, a marginal increase effectively erased by inflation. Africa’s health financing would need to increase 169% from US$59.45 billion in 2022 to US$160 billion to achieve 4% of current GDP.

The composition of that financing also needs to change. Currently, health spending by source is not optimised for sustainability or impact. African citizens provide 37% of health financing out of pocket, a situation that creates significant vulnerabilities for poor families hit by health crises (WHO recommends out-of-pocket health spending should be kept below 20%).

The scale, quality, and impact of health financing needs to improve. Development Assistance for Health is relatively small: just 13% on average in African countries. And, it may decline by up to 50% by 2030.( 2 ) This illustrates a fundamental disconnect between today’s reality and Africa’s future financing needs if the continent is to harness the benefits of its demographic boom.

The table titled ‘Scenarios of Africa’s Health Finance’ compares the current spending breakdown in Africa with future scenarios. At present, out-of-pocket spending dominates the financial flows for health spending. The chart presents a scenario where Official Development Assistance (ODA) for health falls by 50% (assuming a 75% decline from the US, 40% from the UK, 30% each from France and Italy, and 20% from Germany), and where government contributions and other domestic private spending steps in to fill part of the gap.

It then presents an ‘optimal scenario’ where Africa is spending at minimum 4% of GDP on health (as recommended by WHO) and that out-of-pocket spending declines. While this scenario is notional, it points to an axiomatic truth: government and private contributions need to increase dramatically.

Scenarios for Africa’s Health Spending by Health Financing Source( 3 )

2. Pathways to Progress

African countries must dramatically increase domestic resources for health. That includes unlocking novel pathways to improve health financing from “other domestic private spending,” including philanthropic contributions, employer-sponsored health services, and community-based health funds.

2.1 Mobilizing Domestic Resources for Health

Many African finance ministers are grappling with a debt crisis that consumes 12.6% of their government budgets, on average. Even before the COVID-19 pandemic, over 30 African countries spent more on debt service than on health.

Achieving health security will require countries to allocate a greater share of national budgets to health. In practice, this would mean that African governments are able to (1) grow and strengthen their economies, (2) increase fiscal space, and (3) consistently allocate domestic resources toward health.

‘Dependency on External Financing for Health’ segments countries by income group and how much in-country health spending is provided by donors. The coloured dots indicate countries that have higher capacity for spending based on tax-to-GDP ratios.

Proportionally, upper-middle-income countries receive less health aid, as is to be expected. But for low- and lower-middle-income countries, there is little correlation between income groups and their reliance on health aid.

But look more closely, and you see that low-income countries receiving a relatively low level of health aid tend to be fragile states (e.g Mali, Chad, Sudan). This is perhaps because fragile states have a lower capacity to absorb donor financing, so health financing is deployed through NGOs or UN agencies.

Low-income countries with high health aid dependency tend to have stronger state capacity in Eastern and Southern Africa (e.g. Malawi, Mozambique, Uganda). Stronger state capacity indicates that these countries may have more space to provide these resources domestically.

For lower-middle-income countries, high health aid dependency is also more common in Eastern and Southern Africa (e.g. Zimbabwe, Zambia, Tanzania). Those with lower health aid dependency are in North Africa (e.g. Egypt, Morocco, Tunisia).

‘GDP Growth and Health Spending in Africa’ segments African countries by GDP growth and government spending on health as a percentage of their total budget. The ideal scenario (top right quadrant) is strong economic growth and high health expenditure. Only one country, Cabo Verde, achieved the ideal scenario–meeting the Abuja Declaration Target of spending 15% of its government budget on health amid relatively high economic growth. Namibia and Botswana also stand out as having high growth and higher health spending.

The key question is how countries progress from positions of lower growth and/or lower health spending to higher growth and higher health spending. That is, how do countries shift into the top-right quadrant?

Some countries simply do not have the fiscal space to spend more on health. They will need a greater share of shrinking, and inconsistent, donor aid envelopes while making progress on economic and health indicators (e.g. Malawi). Meanwhile, fragile states with both low growth and minimal health investments (lower left quadrant), like Libya and South Sudan, rely on scarce donor and humanitarian assistance, which should be strategically directed to these regions.

Segmenting countries in this way provides a starting point for a more nuanced discussion about what types of action are needed to help countries make progress. For example:

1. Natural resource-rich countries like the Democratic Republic of Congo, Niger, and Nigeria benefit from economic growth driven by natural resource revenues. Yet, health is not prioritised in their budgets. This fits a pattern across many natural resource-rich countries: governments that are not dependent on their citizens for resource revenues prioritise them less in their spending. Here, political prioritisation and accountability for resource revenue management and health financing progress are part of the solution.
2. Countries at risk of debt distress: Lower-middle-income countries with reasonable growth rates but high debt levels are unsurprisingly underspending on health (e.g. Ghana, Zambia, Kenya). Here, opening fiscal space through debt and tax reform is urgently needed, paired with greater incentives and accountability for health spending.
3. Countries with low levels of growth that prioritise health: Lesotho, Eswatini and South Africa stand out as having low levels of growth but higher levels of health spending. Here, consistent political prioritization of health spending is needed to ensure this pattern continues over time.

2.2 Increasing Political Incentives for Prioritising Health Financing

Opening fiscal space alone will not translate to more financing for health unless the incentives and accountability are in place for policy makers to prioritise health spending in national accounts.

The demand for improved healthcare exists across Africa. A 2024 Afrobarometer survey found that, on average across 39 surveyed countries, health ranks second among the most important problems that Africans want their governments to address, trailing only unemployment as a priority for government action.

Yet, the same survey shows that a majority of Africans (58%) say that their current government is not doing well at improving basic health services. This is borne out by budget data (a proxy for political prioritisation). Understanding why health spending has not been a higher priority for African governments, despite widespread demand, is critical for determining how best to catalyse increased health spending.

Several cross-country academic studies have examined how advocacy and political prioritisation influence government financing in the health and social sectors. For instance, in Thailand, the convergence of political, social, and intellectual forces drove significant health financing reforms that led to the successful implementation of Universal Health Coverage, with health increasing to around 16% of the government budget. A study across 102 countries found that political factors, such as improved accountability and efforts to direct resources to those in most need, may promote increased spending on primary health care.

Therefore, there is a need for a nuanced strategy that both accounts for political priorities impacting health financing and scales appropriate policy recommendations accordingly.

2.3 Unlocking Novel Pathways for Increased Health Financing

While increased national health spending will be essential to improving health security in Africa, novel pathways to crowd in private sector innovations and unlock additional sources of funding could help fill gaps and catalyse progress as macro-economic reforms take shape. These include harnessing remittances, expanding health insurance coverage, addressing illicit financial flows and investing in medical infrastructure.

With billions of dollars in diaspora remittances flowing into African economies annually, financial innovations such as mobile health wallets and microinsurance schemes could help channel these funds directly into healthcare. Collaborations between fintech, healthtech companies, banks, and mobile money providers could enable remittances to be allocated to health savings accounts or prepaid insurance plans, ensuring that funds sent by the diaspora directly support family healthcare needs. This approach, alongside efforts to reduce remittance costs, would reduce out-of-pocket expenses and financial barriers, making care more accessible and affordable.

Beyond remittances, the private sector is key to expanding health insurance coverage, especially for informal sector workers who lack traditional coverage. African healthtech firms are already leveraging digital platforms to offer affordable and flexible insurance plans tailored to underserved populations – but these need to be scaled and replicated across countries. Integrating these solutions with community-based health education campaigns can help shift out-of-pocket spending into structured insurance models, reducing financial hardship for households over time. Through targeted interventions, the private sector can complement government health financing efforts and drive sustainable, long-term improvements in healthcare access and affordability across Africa.

The promise of these solutions should be explored but not overstated.

3. Narrowing the Options: Applying High-impact Policy Reforms and Advocacy Investments

Taking all of this into account, countries need policy recommendations that work across three planes: (a) innovations in macro-economic and fiscal policy, (b) scaling novel pathways for financing, and (c) increasing political prioritisation.

However, the reality facing African governments is that the scope for prioritising health is limited by political dynamics, international trade and tax regulations, and the decisions shaped by international financial institutions (IFIs) such as the IMF and World Bank.

Therefore, a nuanced strategy for addressing these challenges requires action at the national, regional (i.e. African Union), and international level.

This typology of interventions will help shape a strategy for:

1. What countries can do themselves: Here, civil society advocacy, building national level champions for reforms, and capacity building to implement those reforms is critical.
2. Where advocacy is needed to other actors and processes: Governments operate within the constraints of regional and international economic and fiscal dynamics, relationships with creditors and bond markets, trade partners, and IFIs. Here building multi-country coalitions and influence strategies to unlock barriers to health investment is critical. This includes technical policy proposals and advocacy, international campaigns targeting IFIs and G20 countries, and multistakeholder reform coalitions such as the Bridgetown Initiative.

Toward Action

Discussions on improving health financing in Africa are abundant but often lack actionable outcomes appropriate to the relevant country situation. Progress in the areas outlined above will not happen quickly or consistently across countries. Many of the reforms will require overcoming major structural, political, and systemic barriers. Strategies to address these barriers are complex, political, and take years to yield results.

Therefore, moving towards action will require filtering the options by a set of criteria oriented toward identifying opportunities where breakthroughs are possible. To help identify which pathways would benefit from renewed focus and collection action we propose using the following four filters:

1. Evidence-based: There is credible research and broad consensus to support the intervention.
2. Proven: At minimum, the policy or reform has demonstrated proof-of-concept and the potential to be scaled in low- or lower-middle-income African countries.
3. Political opportunity: There is political momentum or specific opportunities that would benefit from collective, focused action to achieve progress in the next 1-3 years.
4. Size of the prize: Is the effort worth the squeeze?