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6 Sustainable Financing for Global Disease Surveillance and Response “At this time of global economic downturn, we face a crossroads. We can cut back on health expenditures and incur massive losses in lives and fundamental capacity for growth. Or we can invest in health and spare both people and economies the high cost of inaction.” —Ban Ki-moon Secretary-General of the United Nations Remarks at the Forum on Global Health: The Tie That Binds (June , 00) International funding is necessary to develop and sustain a global zoo- notic disease surveillance and response system. Developing an international financing framework especially to assist resource-constrained countries will be challenging. The existing international aid architecture for combating zoonotic diseases is fragmented, and fostering multisectoral cooperation between human and animal health at the local and global levels has proven difficult. Donor funding is unpredictable, especially during a global eco- nomic crisis. At the same time, innovative financing tools and mechanisms can provide new ways to modify the existing international aid architecture to create long-term, predictable funding streams. This chapter provides an overview of the current environment for investing in zoonotic disease surveillance and discusses possible financing solutions. FUNDING ANIMAL DISEASE SURVEILLANCE As discussed in Chapter 2, the development and implementation of animal disease surveillance—usually as part of national animal health in- frastructure, especially in the United States—was a result of the recognition that herds free of selected diseases could translate into broader social and economic benefits. Public investment in animal health helped facilitate ex- port growth by enabling the movement of disease-free animals and related products into new markets and countries. The resulting disease surveillance systems were structured around defined hierarchal relationships address- ing governance and geography (local, state, federal), with the government 

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 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES having oversight in the collection, summary, validation, and reporting of disease surveillance information. Decentralized Disease Surveillance as an Emerging Concept An important characteristic of animal disease surveillance has been the centralized manner in which data have been captured. This provides for the establishment of defined standards and processes and can help to ensure accuracy and consistency in reporting. It is a clear-cut approach that is most achievable with adequate resources, expertise, legal frameworks, aligned objectives, and sustained commitment; unfortunately this is not the case in many countries. During an international response to a zoonotic disease, a number of different stakeholders may often hold or withhold information or resources depending on their particular incentives and objectives. A more centralized approach can mitigate some of this, but the growing reality is that the open economy and globalization are presenting both challenges and opportunities for how future disease surveillance systems will be defined and funded. The issues can be complex and layered, but possibilities are emerging as paradigms shift, relationships change, communities evolve, and technology advances. Investing in Human and Veterinary Health Infrastructure and Disease Surveillance The level of global economic interdependence is increasing, and econo- mies are increasingly bound to the overall sanitary status of a country. It would seem only logical that governments and industry would make the necessary and ongoing investments in human and animal health and veterinary infrastructure, but that is not always the case. The public and government officials often have short attention spans and are challenged by competing interests for limited resources. As a result, ongoing invest- ment often takes a back seat to more pressing issues. Government invest- ments may not be commensurate with the significant value of national resources—with proportionally little designated for disease surveillance. This is particularly the case for the veterinary sector. Complicating these issues is the lack of continuity and leadership in ministries of agriculture, where time spent in office can be politically short-lived. This transience filters down through multiple layers in the organization because a change in ministers is usually accompanied by a broader reorganization. Coupled with low salaries in the public sector, this situation requires repetitive cycles of basic training. Furthermore, this hinders the effectiveness of countries as member states within important international organizations. Each year, the World Organization for Animal Health (OIE) convenes its 174 member

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 SUSTAINABLE FINANCING countries and territories to discuss and approve new international health standards. OIE estimates that a full one-third of the chief veterinary of- ficers who come each year are newly installed. By the time these heads of delegation learn how best to represent their countries, many are replaced and the cycle continues. The fact that many developing countries request technical support and financial resources from the international community undoubtedly reflects the poor internal state of affairs in their human and animal health infra- structures. In addition, the veterinary workforce is limited even though many infectious diseases are discovered by the veterinary community (e.g., viral cancers, retroviruses, lentiviruses, transmissible spongiform encepha- lopathies such as bovine spongiform encephalopathy, rotaviruses, papillo- maviruses, coronaviruses, ehrlichioses) and later turn out to be of human and animal health importance. Veterinarians and animal health profession- als are an essential component in detecting zoonotic diseases earlier and therefore preventing infection in humans. But more fundamental issues may also be inhibiting long-term growth and sustainability. Money is a neces- sary, but insufficient, condition for sustained change. The international community jolted into action when it became clear that the highly pathogenic avian influenza (HPAI) H5N1 strain was on Eu- rope’s doorsteps and could pose a human health risk at a global level. The United Nations World Health and Food and Agriculture Organizations, the World Bank, and OIE sponsored international conferences. Banks, aid agencies, and nations themselves pledged nearly $3 billion to combat the disease and address the alarming human and animal health concerns (Government of Egypt, 2008). In many ways, the response was a positive example of the international community coming together to attack a global threat. But putting out a fire and addressing the underlying causes of the fire are two different goals. A recent World Bank report (2006a) on the extent of the needs and gaps in the development of a financing framework for the next pandemic emphasizes the need for medium- and long-term planning. The main con- cern for this strategy is the endemic nature of HPAI H5N1 in the Southeast Asia region. So far, most of the economic impact of HPAI H5N1 in the East Asia region is occurring in the rural economies. The gross domestic prod- uct (GDP) impact in East Asia economies has been restricted to a 0.1–0.2 percent loss in countries such as Vietnam. However, the economic impact associated with severe acute respiratory syndrome resulted in a 2 percent loss of the regional East Asian GDP in 2003 (World Bank, 2005). Short-term emergency actions such as disease control or eradication1 1 In animal health, eradication of a specific disease is considered on a nation-by-nation status.

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0 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES and improving infrastructure—including ongoing disease surveillance— while not mutually exclusive, are not a single endeavor. Eradicating a disease requires specific skill sets and large financial outlays for direct field activities such as vaccination or herd depopulation (culling). Building an adequate and sustainable human and animal health infrastructure that in- cludes critical components such as disease surveillance, on the other hand, requires raising the overall levels of technical capacity, building human and financial capital, and fostering collaboration between the public and private sectors. The scope goes beyond any one disease to the ability to proactively address multiple potential emerging diseases and to permanently raise the country’s sanitary status. Independent, international financial support can actually hamper long- term sustainability of a recipient country’s infrastructure. In many coun- tries, funding for human and animal health infrastructure competes with other government programs for public funds. Most of that money is tied up in salaries for existing personnel, so little remains for program opera- tions. Tight budgets mean that capital improvements are difficult to carry out. Therefore, what the international community may regard as “bridge funds” until the country can put in place a more sustainable approach becomes the primary source of funding, underwriting a variety of program activities, ranging from field supplies and diagnostic equipment to vehicles and fuel for data collection. Ironically, the presence of a disease makes pos- sible a coveted inflow of resources that might not otherwise be available and reduces the need for elected officials to make tough choices regarding the priority of human and animal health within the national agenda. The inflow of external resources also relieves the immediate pressure to establish longer-term national solutions. When external resources are withdrawn, the infrastructure regresses, but the impacts may not be felt until the next disease crisis. Countries are at varying stages of advancement regarding their national infrastructure, but two factors stand out as making a critical difference: the level of interaction between the public and private sectors, and continuing leadership. Those countries whose veterinary infrastructures are on the up- swing benefit from a private sector that invests its time and resources into strengthening the national infrastructure—similar to its efforts to develop new animal feeds, secure better genetics in its breeding stock, or push into new markets. In countries where animal health infrastructures are weak, mutual distrust or apathy may exist between the two sectors. This can be reflected in allegations of corruption, incompetence, and lack of vision and continuity. Simply injecting external resources under these conditions can mask these underlying problems and prolong the difficult tasks of fortifying national infrastructure and improving relations between the two sectors. The conditions for sustained investment begin by taking a more inte-

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 SUSTAINABLE FINANCING grated approach and creating the foundation for addressing critical com- petencies, such as current and future disease surveillance—starting with a shared vision between the public and private sectors. Essential to this vi- sion is the establishment of trust, transparency, and clearer communication between the two sectors. Although financial resources are also important, they are not a panacea. Equally important are changing attitudes, building bridges for collaboration, and continuing leadership. When these happen, an environment of empowerment prevails that weans countries from the belief that little can happen without external resources; much is within the country’s control, and is less reliant on international organizations or funding. If sustained, the process leads to a set of priorities with measurable outcomes that gauge incremental progress. Any type of centralized disease surveillance requires a sustained com- mitment over time on the part of both the public and private sectors. The private sector sees investment in veterinary infrastructure as good business practice, and decreased exposure to disease is a way to protect the private sector’s investment and to open new market opportunities. The public sec- tor helps ensure that benefits accrue from the greater public good of an elevated sanitary status. However, in practice, financial resources across countries have varied, ranging from those largely reliant on public expendi- tures (e.g., United States) to those raising resources from the private sector (e.g., Australia and New Zealand) to appropriate and implement public sector activities. CURRENT FUNDING EFFORTS Regardless of the proportions of fiscal contributions from any sector or the relationship between them, the funding needs for developing and sustaining a global disease surveillance system for emerging and reemerg- ing zoonotic diseases will be significant. Recent concerns about a potential highly virulent human influenza pandemic have resulted in coordinated international action to help countries improve their ability to detect dis- ease outbreaks. The funding efforts for these actions have been led by the World Bank, which has used two main mechanisms to provide assistance to countries with avian influenza and to prepare for a possible pandemic. These mechanisms are the Global Program on Avian Influenza (GPAI) and the multi-donor trust fund known as the Avian and Human Influenza (AHI) Facility.2 2 The Global Program on Avian Influenza sanctions loans, credits, or grants up to $500 million from the concessional arm called the International Development Association. The program uses an integrated approach developed with the United Nations World Health and Food and Agriculture Organizations and the World Organization for Animal Health. The

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 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES GPAI and the AHI Facility were conceived as concerted efforts by the United Nations (UN) and some multilateral and bilateral agencies to respond to the growing threat of HPAI H5N1 and to prepare for the next influenza pandemic. In September 2005, the United Nations Secretary- General appointed a System Influenza Coordinator (UNSIC). UNSIC was a key factor in developing a strong partnership among technical agencies such as the World Health Organization (WHO), the Food and Agriculture Organization of the United Nations (FAO), and OIE, and other bilateral and multilateral partners, including the World Bank. The partnership focused on developing a flexible and responsive framework to provide financial and technical support at country, regional, and global levels. Both urgent and long-term needs were targeted. The 2008 progress report by UNSIC and the World Bank provides an analysis of the response to HPAI H5N1 and the state of pandemic readiness (UNSIC and World Bank, 2008). Although it does not provide detailed information on spending for areas such as laboratory and human capacity building, there is a detailed breakdown by sector of the funds disbursed by October 2008: 24 percent for animal health, biosecurity, sustainable livelihood; 36 percent for human health and pandemic preparedness; 14 percent for information, education and communication; 11 percent for supporting implementation monitor- ing, evaluation, and internal coordination; and 15 percent designated as other (UNSIC and World Bank, 2008). Although these World Bank opera- tions identify funding to support country, regional, and global levels of HPAI H5N1 pandemic preparedness, they also support the discussion in Chapter 5 about the importance of and challenges to country incentives to report an outbreak. Additional resources were provided directly from bilateral sources and the European Commission through WHO and FAO, and to a lesser extent through OIE, and to individual countries. They showed a much better disbursement rate than the multilateral development agencies. As Table 6-1 shows, the bilateral donors committed a total of $1.4 billion USD, of which 90 percent was disbursed on April 30, 2008; the European Union funds can be used to improve the health and veterinary services of the countries, prepare and respond to the pandemic influenza, and minimize the threat to its populations. The funds go through the World Bank’s emergency procedures and therefore can be quickly prepared and approved. It is a trust fund located at the World Bank under a partnership that is led by the European Commission, and other donors such as Australia, China, Estonia, Iceland, Korea, the Russian Federation, Slovenia, and the United Kingdom. The Avian and Human Influenza (AHI) Facility helps developing countries meet their financing gaps within their integrated national plans to minimize risk and socioeconomic impact of the pandemic on humans and animals. As of January 2009, the total pledged commitment to the AHI Facility was more than $126 million equivalent (World Bank, 2009a).

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TABLE 6-1 Avian and Human Influenza Pledges, Commitments, and Disbursements as of April 30, 2008 (US$ million) Inter-ministerial Meetings Percentage Donor Beijing Bamako New Delhi Totalc Commitmentd Disbursemente Disbursed Uncommitted Australia 56 55 111 100 67 67% 11 Canada 87 87 91 40 44% — France 31 10 7 48 50 34 69% — Germany 29 8 4 41 41 30 73% — Japan 155 67 69 291 297 297 100% — Netherlands 14 7 21 22 10 44% — Russia 24 8 32 32 29 92% — United Kingdom 36 18 10 65 61 51 83% 3 United States 334 100 195 629 629 629 100% — Other EU Countriesa 31 11 11 42 53 48 90% 6 Other Countriesb 33 4 4 41 33 31 94% 10 Subtotal Bilateral Donors 742 376 290 1,408 1,410 1,266 90% 30f European Commission 124 83 111 319 241 140 58% 79 Asian Development Bank 468 468 83 13 16% 385 African Development Bank 15 15 7 4 63% 8 World Bank 501 501 313 69 22% 187 Subtotal Multilateral Development Banks 969 15 984 403 87 22% 580 Grand Total 1,835 474 401 2,710 2,054 1,494 73% 689 NOTES: Donors’ reports of amounts committed and disbursed from calendar year 2005 and to April 30, 2008. Uncommitted amounts are net of commitments in excess of pledges. aAustria, Belgium, Cyprus, Czech Republic, Estonia, Finland, Greece, Hungary (which has retracted its pledge due to lack of response from recipi- ent country), Ireland, Italy, Luxembourg, Slovenia, Spain, and Sweden. bIceland, Korea (Republic of), Norway, Saudi Arabia, Singapore, Switzerland, and Thailand. cTotal of pledges from the three international conferences on avian and pandemic influenza (Bamako, Beijing, and New Delhi). dCommitment is defined as the result of an agreement between the donor and recipient for designated purposes; a commitment is a firm decision that prevents the use of allocated amount for other purposes. eDisbursement is defined as the actual budget transfer or release of funds to the recipient for an intended purpose. fThis number represents the portion of total donor pledges that remain uncommitted. As some donors have committed more than their pledged amounts, this number does not correspond to the difference between the total (1,408) minus the total commitments (1,410).  SOURCE: UNSIC and World Bank (2008).

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 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES committed a total of $241 million USD, of which 58 percent was disbursed on that date; and the Multilateral Development Banks had committed on that same date $403 million USD, of which only 22 percent was disbursed (UNSIC and World Bank, 2008). In countries where outbreak reporting is hampered only by the avail- ability of financial and technical resources, these programs are likely to improve disease surveillance information. However, in countries that could afford their own programs if desired, these resources would either displace national resources for disease surveillance or be misspent if incentives for the country to detect and report an outbreak are not changed. In addition, the global approach to finance widespread prevention or control of HPAI H5N1 needs to consist of multisectoral coordination and integrated response at the national, subnational, and global levels as de- tailed in recommendations from the FAO, OIE, WHO, UNSIC, UNICEF, and World Bank Strategic Framework (2008), prepared for the Sharm el-Sheikh Inter-ministerial Conference on Avian and Pandemic Influenza. Consequently, some of the policy issues that can emerge correspond to the fact that most resource-poor nations lack the resources for the development of training and capacity-building programs of this nature (World Bank, 2006a). Completing HPAI H5N1 Control Activities The recent joint Strategic Framework (FAO et al., 2008) reports that of the $2.7 billion pledged in the subsequent international Inter-ministerial Meetings, a total of $2 billion has been firmly committed or already ex- pended for the human and animal control cost of HPAI H5N1. The break- down of the expenditure provides that about 41 percent ($853 million) was directed to national programs, about 25 percent ($510 million) to in- ternational organizations, 15 percent ($301 million) to regional programs, and the remaining 19 percent ($386 million) to other programs, including research. This expenditure pattern seems to deviate somewhat from the earlier declaration of the Beijing conference, the first inter-ministerial meet- ing on control of HPAI H5N1, which declared that “individual countries are central to a coordinated response.” The novelty of the threat, which caught the international community and international organizations by surprise, is probably the reason for the bias toward international programs. Future funds could, most likely, be more directed toward national govern- ments. The Strategic Framework also reports a shortfall in the current programs of $836 million, mainly because of unmet pledges. Most ($440 million, or more than 50 percent) of this shortfall concerns the sub-Saharan subcontinent.

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 SUSTAINABLE FINANCING Developing Global Capacity The Strategic Framework (FAO et al., 2008) makes a very approximate assessment of the costs of a permanent global disease surveillance system, acknowledging that in preparing these estimates, provided in Table 6-2, this was “an art, not a science” (FAO et al., 2008, p. 44). These tentative cost estimates are provided for 49 low-income countries and for all 139 low- and middle-income countries. The table reflects the much higher need per country for the low-income countries and includes a basic infrastructure establishment and operation, and special investment in 40 “hotspot” coun- tries, as described in Table 6-3 under global responsibility. The estimates also account for previous investments already carried out under the ongo- ing AHI Facility. It also includes the approximate estimate of the needs to complete the current campaign, which is based on the considerable number of already prepared Integrated National Action Plans (140 by September 2008). They were based on an assessment by joint human and animal health specialists. They were based on early detection and response to HPAI H5N1. The study committee conducted rough estimates regarding the cost to scale up these HPAI H5N1 needs to survey and control of multiple spe- cies. This will come close to International Health Regulations 2005 (IHR 2005) surveillance requirements. The annual additional financing needed over the next 3 years would range from $542 million to $735 million. Based on the working paper for this assessment (FAO et al., 2008), more than 50 percent (nearly $6 billion) would be operating costs, and the remain- ing $5 billion would be investments in hardware (laboratories, equipment) and human skills (training, etc.). The rather high share of operating costs reflects the major infrastructure investments already made under the current HPAI H5N1 campaign and is based on 2008 prices without inflation. TABLE 6-2 Estimated Cost of Funding the One World One Health Framework to 2020 (millions of US$) Category of Expenditure 49 Low-Income Countries 139 Eligible Countries Prevention: Human and animal health services 1,264 3,083 Veterinary services 3,286 5,476 Wildlife monitoring 1,495 2,495 Communication 583 1,167 International organizations 3,180 3,475 Research 420 420 Total 10,228 16,116 Average per year 852 1,343 SOURCE: FAO et al. (2008).

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 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES FUNDING A GLOBAL PUBLIC GOOD Policymakers generally agree that the responsibility for funding has to be divided among international, national, and local public and private sources. The most common key criteria being applied to decide which of these sources is responsible for a particular service are (1) the degree of externalities involved in the consumption of those goods (i.e., the extent to which they are a public good); (2) whether these goods are mostly global, national, local, or private; and (3) the capacity to pay. Conceptually, it fol- lows logically that the global community funds the global public goods; the national and local public sectors, respectively, fund the national and local public goods; and the private sector funds private goods. Because of their transboundary nature, protection from highly infectious zoonotic diseases is generally considered a global public good. Preventing the emergence and cross-border spread of human and ani- mal highly infectious diseases conforms to this definition and is generally considered to be a global public good. Less infectious and hence more local disease risks—such as rabies or bovine tuberculosis—are by their nature national or local public goods, often also with private goods characteris- tics. Their control benefits the local population, and in the case of animal diseases, the individual private owner. One important issue in this context, however, is whether to include equity and poverty alleviation as criteria for deciding whether a disease is a global public good. From a global social perspective, this would be ap- propriate. Poverty alleviation is a key Millennium Development Goal and explicitly defined as a global responsibility. This discussion has specific relevance in the case of zoonotic diseases because they are typically the “diseases of the poor,” affecting their health and that of their animal stock proportionally more than other types of diseases. However, this would have major repercussions on the funding requirements, and hence in this report, the zoonotic diseases of a lesser transboundary nature are classified as a national public or private good. Most public goods, including those of global characteristics, are im- pure; they have components with various degrees of exclusion or rivalry and thus present a mixture of public and private goods. Disease surveillance systems have such characteristics. They cannot be disease specific, but un- derpin the prevention of emergence and spread of highly infectious diseases, which is recognized as a global public good. Surveillance for all diseases is therefore considered a global public good. Control is much more disease specific, and hence becomes a national, local, or private good in the case of disease of low human epidemic nature. These considerations are reflected in Table 6-3.

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 SUSTAINABLE FINANCING TABLE 6-3 Disease Prevention and Control Activities at the Human– Animal–Ecosystems Interface and Their Status Level as a Public Good Disease of Moderate Disease of Low Human to High Human Activity Epidemic Potential Epidemic Potential 1. Preparedness Risk analysis Global Global Preparedness plan National/regional Global Privatea Animal vaccine development Global 2. Disease surveillance Human and animal health, veterinary Global Global and wildlife Diagnostic capacity Global Global Managerial and policy arrangements National Global 3. Outbreak control Rapid response teams National/regional National/global Vaccination National/regional/private Regional/global Cooperation among human, veterinary, National Global and wildlife services Compensation schemes National/private Global 4. Eradication plans National/regional/private Global 5. Research National/regional/private Global aThis may also be a global public good depending on diseases and circumstances (context). SOURCE: Adapted from FAO et al. (2008). FUNDING MECHANISMS All industrialized and middle-income nations need to have responsi- bility for funding their own disease surveillance systems, a sentiment also reflected in the Sharm el-Sheikh Framework Document. Industrialized coun- tries also have the responsibility to fund research to develop surveillance and control technology. Low-income countries, however, have multiple and immediate needs competing for limited resources. Quite understandably, a long-term investment in the operation of a disease surveillance system cannot be feasibly prioritized above other needs for low-income countries. International funding is therefore necessary and fully justified in view of the global public good involved, as well as the human and animal health and economic benefit that the international community derives from early detection of a potential health or economic (trade) risk. For the international funding of a disease surveillance and early re- sponse system in low-income countries, the classical and still current way such investments are funded consists of a time-bound (mostly 3–5 years), project-based investment, with the external investor (mostly bilateral or

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 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES international donor or financing agencies) funding most of the infrastruc- ture costs (laboratory, transport, etc.) and some initial operating costs. In this model, the recipient country funds part of the operating costs and is expected to continue to fund the activity after the time-bound project ends. Long-term financing by these international agencies is often not possible because of internal budgetary procedures, parliamentary approval cycles, policy changes, and geopolitical considerations. This model has major constraints funding the national part of the operating costs, with even greater problems in low-income countries to maintain the operation after the international financing stops. Pre-project commitments of governments are difficult to enforce in the post-project period, and the general scenario is one of a high activity level when external financing is available. This is fol- lowed by a low activity level when the external funding stops. For a system that is expected to provide a continuing service to the global community, such a “boom and bust” model is not recommended. The constraints of many poor countries may prohibit their provision of the necessary funding and consequently their participation in any glob- ally sustained efforts of disease surveillance for preventing and control- ling emerging zoonotic diseases. This situation would result in the typical “weakest link” problem, whereby a country with poor capacity and no resources would jeopardize the efforts of all others. The committee con- cludes that the global tasks as described in Table - clearly require new, more innovative ways of fully or partially funding their costs to replace the current boom and bust model. The committee reviewed several options for funding this global public good: • Long-term twinning arrangements between human and animal health institutes of high-income and resource-poor countries, funded by specific budget lines in those high-income countries; • Long-term commitments of governments to fund WHO/IHR 2005 and FAO/OIE in supporting global disease surveillance systems; • Establishment of special endowments through nonconventional donors; • Imposition of a levy on internationally traded meat; and • Other public–private partnerships. The fund, regardless of its sources, could provide the full costs of global disease surveillance (infrastructure and recurrent costs) or only the recurrent costs because international funding generally is available for the hardware investments.

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 SUSTAINABLE FINANCING Long-Term Twinning Arrangements Under this option, governments from high-income countries, through their human and animal health institutions, would commit to permanent support for their counterpart institutions in resource-poor countries. This would require a long-term engagement of the high-income country, and, in line with its budgetary procedures, be an integral part of the budget of those agencies in the high-income country, and not be seen as a time-bound contract. For the high-income country, this would have the advantage that it could select the group of countries it likes to sponsor, for example, based on the risk that an outbreak of a zoonotic disease poses to its own human or animal health. Another positive aspect would be the long-term capacity- building opportunities for the recipient country. This model has already been used, for example, by Australia in several Sanitary and Phytosanitary Measures Agreement-related aspects in Southeast Asia. Drawbacks of such an approach would be a certain fragmentation of approaches because the agencies of the high-income countries would tend to establish their own standards and procedures. Another disadvantage would be that the dependence on a national budget, even of a high-income country, would still introduce a degree of fickleness. An additional issue to address in the aspect of twinning support is ensuring that reagents and samples can be exchanged easily. Documentation required for shipment and receipt of biological materials has increased dramatically since 9/11 and can prolong diagnosis time. Long-Term Commitments of Governments to Fund WHO/IHR and FAO/OIE This would imply that high- and middle-income countries directly commit to permanently support a funding mechanism established by inter- national agencies. This would enable a full implementation of IHR 2005, which is now underfunded, and would enable FAO and OIE to continue their current support to developing countries, when their funding for HPAI H5N1 concludes, which will be 2010 for most funds. Contributions could be channeled in specific funds, such the OIE World Animal Health and Welfare Fund, and the FAO Special Fund for Emergency and Rehabilita- tion Activities. A key requirement would be that the three international agencies (WHO, FAO, and OIE) and other donor agencies establish close cooperation mechanisms on priority countries and hotspots, on minimum requirements to be funded and other funding criteria, and fully support the principle of an integrated human–animal (and ecosystem) health system. If not, this option could lead to fragmentation, duplication, and an overall

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00 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES inefficient use of resources. As in the case of the twinning arrangements, this option would also depend on the long-term commitment of high-income countries, and whether that commitment is likely to waver. Establishment of Endowment Funds Through Nonconventional Donors Nonconventional donors and foundations and a few conventional do- nors generally have a longer investment and support span than most other conventional donors, and funding could be on a regular basis or toward the establishment of an endowment. The establishment of an adequately resourced endowment would be the most appropriate solution, but, if es- tablished, is unlikely to be able to fund the amounts necessary in the near future, and other sources would need to be identified. This would still have some of the disadvantages of the earlier options. A Levy on Internationally Traded Meat Although several levy sources would be possible, one option to be con- sidered in more detail would the imposition of a levy on meat trade from middle- and high-income countries. Developed countries are the major ex- porters of meat (see Table 6-4). A meat levy to control emerging pandemics would be directly related to the global public good of control of zoonotic diseases. As in the twinning arrangement, it would provide an incentive to the middle- and high-income countries because a strong global disease surveillance and early alert system would help to protect their food-animal production sector against the introduction of other contagious animal diseases, such as foot-and-mouth disease. Under the same argument of enlightened self-interest, the levy would have to be collected by the export- ing country, and it would be relatively easy to collect by customs offices. Importing countries have more limited incentives to protect their own food-animal population. The meat levy would not apply to the low-income TABLE 6-4 Value of Meat Export by Country Income Category Group Bovine Meat Other Meat and Edible Offal Live Country Group (in billions of US$, 2005 data) Animals Middle- to high-income countries 20.1 36.5 11.6 Resource-poor countries 0.8 1 0.5 Total 20.9 37.5 12.1 SOURCE: Adapted from ITC (2009).

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0 SUSTAINABLE FINANCING countries it is raising funds to assist. By exonerating resource-poor3 coun- tries from this levy, this would allow their emerging food-animal production sectors to grow and develop rather than be penalized. The meat levy would not include live animals because of the difficulty in collecting such a fee and the potential unintended consequence of sending the live-animal trade “underground,” leading to more illegal trade. Disad- vantages of such a levy would be the political sensitivity to the imposition of fees (although small as shown below) in an era of globalization and promotion of free trade, its legality under current World Trade Organiza- tion rules, and other impacts, such as the potential for increased illegal importation of bushmeat. Strengthened disease surveillance systems, which would be the intended result of such a funding mechanism, would also help to reduce such illegal trade of bushmeat. However, more study and consul- tation with policymakers and other stakeholders is required to fully assess the political and technical implications of such a financing mechanism. This proposed funding mechanism would have the advantage of well- established systems of levy collection, as many commodity groups or gov- ernments funding national public goods have used such dedicated levies (Nugent and Knaul, 2006). Examples are the imposition of transaction levies on food-animal sales by producers to fund marketing and research on meat in Australia (MLA, 2009); slaughter levies to fund food-animal production insurance against major disease outbreaks in the Netherlands (World Bank, 2006b); and an export levy to fund agricultural research in coffee in sub-Saharan Africa (UNU/INTECH, 1995). These levies directly benefit the producers. The same would apply to the meat levy—this would reduce the risk of infection of notifiable disease and the resulting ban of an exporting country, and therefore be in direct interest of the exporting coun- try. “Check-off” dollars are used in the United States to fund marketing programs for food-animal products. The UK government also just proposed a new arrangement to fund an independent body for animal health, which can raise a levy from food-animal keepers in England through mandatory insurance to recover the costs of dealing with exotic disease outbreaks (Defra, 2009). While these dedicated levies are generally considered an effective way of securing sustainable funding for a public good, less is known about a levy for a global public good. The proposed levy on air traffic to be man- aged by the Global Environment Facility (GEF, 2009) to finance climate change adaptation is one example. A similar levy is another possible source of funding for global disease surveillance, but there are no ongoing opera- 3 Defined as the countries meeting the International Development Association eligibility criteria of $1,095 USD (World Bank, 2009b).

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0 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES tions in the fields of human and animal health. One example, which ap- proaches a global fund similar to the type the committee has advocated, is proposed in a recent feasibility study on the creation of a Global Emergency Response Fund for Animal Epizootics and Zoonoses prepared for the OIE and World Bank conference, Global animal health initiative: The way for- ward. This fund would provide developing and transition countries with immediate funding to cover the cost of control measures and food-animal owners’ compensation costs (Alleweldt et al., 2007). It is still in its initial phase, but has had, until now, limited success in attracting funds. With an estimated 24 million tons of meat exported from developed countries (OECD, 2009), the incremental costs for the meat levy could vary between $0.03 per kilograms (kg) if all costs were covered (of the US $836 million shortfall) and $0.015 per kg for operating costs only. The funds needed to be generated by these permanent streams would thus be reduced by about 50 percent, from $800 million to $400 million. Public–Private Partnerships Opportunities should always be left open to also involve the private sector directly in the funding of global surveillance and response teams. Global food supermarket and restaurant chains have a direct interest in preserving animal and human health, as emerging zoonotic diseases have serious economic repercussions. Typically, until now, they have protected their own herd/flock health, but with past experiences, for example in East Asia, where HPAI H5N1 outbreaks have seriously affected demand for poultry products, they have become more interested in contributing to a wider national or regional surveillance and response system. THE INSTITUTIONAL ARCHITECTURE The institutional architecture would have to be in line with the fund- ing option selected. Under the twinning arrangement, the main issue is the harmonization of standards and areas to be covered to achieve compatible data and complete coverage. Ensuring a coordinating role of the technical agencies for these tasks is important. To directly support funding the inter- national agency, coordination among international agencies is even more important. In this case, an overall coordinating body might be needed to ensure an appropriate distribution of funds. A similar framework would be required for the endowment and levy option. In these cases, the man- agement could be entrusted to a global entity, such as a United Nations agency (e.g., the United Nations Central Emergency Response Fund or UNSIC) or a fund managed by an international funding agency. Activities could be implemented through the technical agencies WHO, FAO, and

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0 SUSTAINABLE FINANCING OIE and any additional agency, such as in the areas of communication and wildlife management. However, to avoid conflicts of interest, these technical agencies should not be charged with the overall management of such a funding mechanism. Alternatively, not necessarily all funds have to be channeled through a global-level institution or institutions; individual developed countries can decide based on their own geographical and insti- tutional preferences and maintain their own sustainable funds. Coordina- tion could be provided through annual inter-ministerial meetings (Bamako, Beijing, Delhi, Sharm el-Sheikh). This was the model for the HPAI H5N1 campaign after the Beijing conference, and it has worked well. More study is clearly indicated. REFERENCES Alleweldt, F., M. Nell, B. Hirsch, J. Syroka, W. Dick, S. Kara, M. Achten, K. Schubert, N. T. K. Cuc, C. Caspari, and M. Christodoulou. 2007. Prevention and control of animal diseases worldwide: Feasibility study—A global fund for emergency response in developing coun- tries. Final Report, Part II. Berlin, Germany: Civic Consulting-Agra CEAS Consulting. Defra (UK Department for Environment, Food and Rural Affairs). 2009. Consultation on a new independent body for animal health: A modern governance and funding structure for tackling animal diseases. London, UK: Defra. FAO, OIE, WHO, UNSIC, UNICEF (Food and Agriculture Organization of the United Na- tions, World Organization for Animal Health, World Health Organization, United Na- tions System Influenza Coordinator, United Nations Children’s Fund), and World Bank. 2008. Contributing to one world, one health: A strategic framework for reducing risks of infectious diseases at the animal–human–ecosystems interface. Consultation document prepared for the Inter-ministerial Meeting on Avian and Pandemic Influenza, Sharm el- Sheikh, Egypt, October 14. GEF (Global Environment Facility). 2009. Innovative financing mechanisms for the GEF. Paper presented at the First Meeting for the Fifth Replenishment of the GEF Trust Fund, Paris, France, March 17–18. Government of Egypt. 2008. The Sharm el-Sheikh vision for the future: Universal solidarity, justice and equity. The 6th International Ministerial Conference on Avian and Pandemic Influenza, Sharm el-Sheikh, Egypt, October 25–26. ITC (International Trade Centre UNCTAD/WTO). 2009. International trade statistics by product group and country: Exports 00–00 dataset. http://www.intracen.org/ tradstat/sitc3-3d/indexpe.htm (accessed March 14, 2009). MLA (Meat and Livestock Australia). 2009. http://www.mla.com.au/default.htm (accessed June 22, 2009). Nugent, R., and F. Knaul. 2006. Fiscal policies for health promotion and disease prevention. In Disease control priorities in developing countries, 2nd ed, edited by D. T. Jamison, J. G. Breman, A. R. Measham, G. Alleyne, M. Claeson, D. B. Evans, P. Jha, A. Mills, and P. Musgrove. Oxford University Press and The World Bank. OECD (Organisation for Economic Co-Operation and Development). 2009. Data extracted on June 22, 2009, from OECD.Stat. In OECD-FAO Agricultural Outlook 00–0. Paris, France: OECD.

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0 GLOBAL SURVEILLANCE AND RESPONSE TO zOONOTIC DISEASES UNSIC (UN System Influenza Coordinator) and World Bank. 2008. Responses to avian influenza and state of pandemic readiness. Fourth Global Progress Report. New York: United Nations. http://siteresources.worldbank.org/EXTAVIANFLU/ Resources/31244401172616490974/Fourth_progress_report_second_printing.pdf (ac- cessed November 5, 2009). UNU/INTECH (United Nations University Studies in New Technologies and Development). 1995. Ghana’s total expenditures on the pursuit of science and technology. In In pursuit of science and technology in Sub-Saharan Africa: The impact of structural adjustment programmes, edited by J. L. Enos. Chatham, Kent: Mackays of Chatham PLC. http:// www.unu.edu/unupress/unupbooks/uu33pe/uu33pe0b.htm#ghana’s%20total%20expen ditures%20on%20the%20pursuit%20of%20science%20and%20technology (accessed June 22, 2009). World Bank. 2005. E ast Asia update: Countering global shocks. N ovember. Wash - ington, DC: The World Bank. http://web.worldbank.org/WBSITE/EXTERNAL/ COUNTRIES/EASTASIAPACIFICEXT/EXTEAPHALFYEARLYUPDATE/0,,content M DK:20708543~menuPK:550232~pagePK:64168445~piPK:64168309~theSite PK:550226,00.html (accessed October 17, 2008). World Bank. 2006a. Avian and human influenza: Financing needs and gaps. Technical note prepared for the International Pledging Conference on Avian and Human Influenza, Beijing, China, January 17–18. Washington, DC: The World Bank. World Bank. 2006b. Enhancing control of HPAI in developing countries through compensa- tion. Washington, DC: The World Bank. World Bank. 2009a. A HIF—Trust fund facility. h ttp://web.worldbank.org/WBSITE/ EXTERNAL/TOPICS/EXTAVIANFLU/0,,contentMDK:21355695~isCURL:Y~menuP K:3124611~pagePK:210058~piPK:210062~theSitePK:3124441,00.html (accessed June 24, 2009). World Bank. 2009b. International development association: Borrowing countries. http:// go.worldbank.org/83SUQPXD20 (accessed June 9, 2009).