South Africa, Ethiopia, and Rwanda are pioneering innovative funding solutions after losing crucial healthcare support due to recent cuts by the U.S. Agency for International Development (USAID).
“The notion of aid being a primary funding model for entire continents is astounding,” says Okito Wedi, CEO of Crtve Development, a pan-African organization advocating for sustainable, African-led development. The drastic reduction in USAID funding—83% of foreign aid contracts were terminated in February—has left many nations scrambling. In South Africa alone, 40 USAID-funded projects were canceled, and thousands of PEPFAR (President’s Emergency Plan for AIDS Relief) jobs were lost, according to UNAIDS.
Professor Linda-Gail Bekker, director of the Desmond Tutu Health Foundation, highlights the severity of the cuts: “PEPFAR funds accounted for 18% of South Africa’s HIV spending—a critical portion that helped control the epidemic.” With this gap, the country must now explore alternative funding, including private-sector partnerships, local fundraising, and increased government support.
Bekker notes progress in reducing reliance on foreign aid, with PEPFAR funding dropping from 100% to 20% over time. However, she stresses the need for full government financing of HIV and TB programs. Meanwhile, Ethiopia has introduced a new worker-funded tax to replace lost USAID support, while Rwanda is investing in homegrown health financing. Nigeria has pledged to retain 28,000 health workers previously funded by USAID, and Zimbabwe is reallocating resources to sustain HIV/AIDS programs.
Wedi calls for serious discussions on financial sustainability: “We must explore private financing, tax reforms, and reduced donor dependency.” However, South Africa faces challenges, including public distrust in government spending. Despite this, Finance Minister Enoch Godongwana allocated an additional R28.9 billion ($1.5 billion) for health in 2025.
Bekker warns against global health disengagement, emphasizing solidarity post-COVID-19. Wedi remains optimistic: “Africa’s resilience can turn this crisis into an opportunity for sustainable development.” As nations adapt, collaboration between governments, the private sector, and philanthropies will be key to long-term self-reliance.
