The Big Shift from assistance to investment in global health
- David Tordrup
- Apr 3
- 2 min read
The landscape of international development has undergone a fundamental transformation in recent years, shifting from traditional donor-recipient relationships to sophisticated investment partnerships driven by measurable returns. This evolution reflects a growing recognition that sustainable development requires more than aid flows; it demands strategic investments that generate both social impact and financial returns. Modern development assistance increasingly employs commercial metrics, impact measurement frameworks, and innovative financing mechanisms to ensure that every pound invested delivers quantifiable value for both donor and recipient nations.
A tangible example of this trend is the evolution of UK aid systems. The Foreign, Commonwealth and Development Office (FCDO), formed in 2020 through the merger of the Foreign and Commonwealth Office (FCO) and Department for International Development (DFID), leads the UK's diplomatic and development efforts globally. Working alongside FCDO, British International Investment (BII), the UK's development finance institution, serves as the country's primary vehicle for impact-focused investment in emerging economies, managing over £7 billion in capital commitments. Together, these organizations represent important pillars of Britain's modern approach to international development.
The evolution of UK's development assistance in the context of healthcare reflects a sophisticated integration of health sector priorities with investment strategy. At the core of this transformation in the UK and elsewhere is a "patient capital" approach to healthcare investments, with a focus on key priorities such as strengthening health systems, expanding quality healthcare access, and catalyzing the spread and uptake of healthcare innovation. A more or less implicit goal of these priorities is creating sustainable healthcare ecosystems that can attract additional private capital and contribute to growth both in the investing and recipient countries.
A concrete example of this strategic direction is the establishment of vehicles for market shaping. Developing markets are characterised by fundamental commercial risks driven by uncertainty around market size, value and growth, making direct commercial investment risky. Organisations such as MedAccess, which is capitalised by BII, provide risk mitigation for commercial investment by guaranteeing markets to manufacturers in specific therapy level agreements.
What does this mean for stakeholders in the global health landscape? From my perspective as a health economist, I expect the following trends
For businesses: Increased commercial opportunity and support for accessing otherwise commercially challenging markets. Understanding these new business opportunities and the support available can be a critical first-mover advantage in securing growth in emerging markets
For donors: A move towards impact and return-on-investment driven international development requires clear expectations and frameworks for impact. What are the key metrics development partners and investment recipients are expected to deliver, and what changes are needed to enable new reporting practices?
For investment recipients: Be prepared to benchmark against not only other investments in the health sector, but in the broader economy. Shifts in spending between health, development and defence, for example, show that no sectors are safe.
For further reading on this topic, and to stay up to date with our thinking at Triangulate Health, please consult the following sources:
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