June 18, 2009

AfDB pumps €10 million into health sector in Africa

By Babajide Komolafe
The Board of Directors of the African  Development Bank (AfDB) has  approved an investment of Euro 10 million in the Investment Fund for Health in Africa (IFHA). IFHA is a pioneer multinational private equity vehicle that invests growth equity in privately owned businesses in the healthcare value chain.

IFHA uses market instruments to enhance the efficiency and quality of health care in Africa. It focuses mainly on existing health insurance organiza-tions, pharma-ceutical production facilities and distribution chains. Investments are expected to range between   0.5 million and  5 million.

Africa’s healthcare sector is severally underfinanced and requires yearly investments of some US$ 2.5 billion over the next 10 years; 50% of it through the rapidly expanding private sector. If properly harnessed, the private sector can complement government efforts to address the health care needs of all segments of the population in Sub-Saharan Africa.

IFHA aims to increase health insurance coverage across the continent; increase the utilization of healthcare services; and scale up and rationalize local production and distribution of high quality pharmaceuticals. When fully operational, portfolio companies will employ about 1,750 staff, comprising 750 healthcare professionals and more than 850 women.