Order Code RL33396
The Global Fund to Fight AIDS,
Tuberculosis, and Malaria:
Progress Report and Issues for Congress
Updated June 11, 2007
Tiaji Salaam-Blyther
Specialist in Foreign Affairs
Foreign Affairs, Defense, and Trade Division

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The Global Fund to Fight AIDS, Tuberculosis, and
Malaria: Progress Report and Issues for Congress
Summary
The Global Fund to Fight AIDS, Tuberculosis, and Malaria, headquartered in
Geneva, Switzerland, is an independent foundation that seeks to attract and rapidly
disburse new resources in developing countries aimed at countering the three
diseases. The Fund is a financing vehicle, not an implementing agency. The origins
of the Fund as an independent entity to fight the three diseases lie partly in a French
proposal made in 1998, in ideas developed in the 106th Congress, and in
recommendations made by United Nations Secretary-General Kofi Annan in April
2001. Though the Global Fund was established in January 2002, President Bush
pledged $200 million to such a fund in May 2001.
As of May 8, 2007, donors have pledged more than $10 billion to the Fund, of
which more than $7 billion has been paid. The funds have been used to support more
than 400 grants totaling more than $7.5 billion for projects in 136 countries. Each
year, the Fund awards grants through Proposal Rounds. There have been six Rounds,
with the Board approving proposals in each year since its inception. In 2005, the
Fund approved Round 5 grants in two tranches, because initially there were
insufficient donor pledges to approve all the recommended proposals. The Fund
approved the first group of proposals in September 2005 and the second group in
December 2005, after donors pledged to make additional contributions. The Global
Fund only approves proposals if it has sufficient resources on hand to support the
first two years of a proposed project. This policy is designed to avoid disruptions to
projects due to funding shortages. Funding lapses can cause interruptions in treatment
regiments, leading to resistant strains of the diseases or death. Funding for a grant's
third through fifth years depend on grant performance and on donor contributions.

The Unites States is the largest single contributor to the Global Fund. To date,
it has appropriated nearly $3 billion to the Fund, providing $724 million in FY2007,
the single largest U.S. contribution to date. Of those funds, $247.5 million was
transferred from the U.S. Agency for International Development (USAID), $377.5
million from the State Department, and $99.0 million from the Department of Health
and Human Services (HHS).
There has been some debate about the level of U.S. contributions to the Fund.
Some critics argue that the United States should temper its support to the Fund,
because the Fund has not demonstrated strong reporting and monitoring practices;
contributions made to the Fund in excess of the President's request are provided at
the expense of U.S. bilateral HIV/AIDS, TB, and malaria programs; and the Fund
needs to secure support from other sources, particularly the private sector.
Supporters of current funding levels counter that the Fund has improved its reporting
and monitoring practices, greater U.S. contributions to the Fund parallel increases in
U.S. bilateral HIV/AIDS, TB, and malaria programs, and the Fund has attempted to
raise participation by the private sector through the launching of Product Red™. This
report, which will be periodically updated, discusses the Fund’s progress to date,
describes U.S. contributions to the organization and presents some issues Congress
might consider.

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Contents
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Global Fund Progress to Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Funding Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Suspended, Discontinued, or Cancelled Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Suspended Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Chad . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Ukraine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Discontinued Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Nigeria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Pakistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Senegal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
South Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Uganda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Terminated Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Burma (Myanmar) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
North Korea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Projected Financial Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Meeting Millennium Development Goals . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Meeting Escalating Grant Requests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Congressional Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Issues for Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Strengthen Reporting and Monitoring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Reauthorize Limits on U.S. Contributions to the Global Fund . . . . . . . . . . 13
Appropriations to the Fund Versus Bilateral HIV/AIDS Efforts . . . . . . . . . 15
List of Figures
Figure 1. U.S. Contributions to the Fund and All U.S. International HIV/AIDS,
TB, and Malaria Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Figure 2. U.S. Contributions to the Fund as a Percentage of All U.S. International
HIV/AIDS, TB, and Malaria Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
List of Tables
Table 1. Global Fund Targets: 2004-2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Table 2. Results of Global Fund Grants to Date . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Table 3. Grant Agreement Totals to Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 4. Funding Requirements, 2008-2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Table 5. U.S. Appropriations to the Global Fund . . . . . . . . . . . . . . . . . . . . . . . . 11

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Table 6. U.S. Appropriations to the Fund as a Percentage of All Fund
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Table 7. Total Global Fund Contributions and Pledges . . . . . . . . . . . . . . . . . . . 15
Table 8. Total U.S. Global HIV/AIDS, TB, and Malaria Appropriations . . . . . 16
Glossary of Abbreviations and Acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

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The Global Fund to Fight AIDS,
Tuberculosis, and Malaria: Progress Report
and Issues for Congress
Background
In January 2002, the Global Fund was established as an independent foundation.
The Fund, based in Switzerland, offers grants that support country efforts to curb the
number of illnesses and deaths caused by HIV/AIDS, tuberculosis (TB), and malaria
infections. Each year, the three diseases kill some 6 million people, mostly in Africa.
The Fund's Board meets at least twice annually to discuss governance issues, such as
grant approval. Nineteen Board seats are rotated among seven donor countries, seven
developing countries, and one person from a developed country non-governmental
organization (NGO), a developing country NGO, the private sector, a foundation, and
affected communities.1 The United States holds a permanent Board seat.
The Fund projects that from 2004 through 2009, it will have supported the
treatment of 1.6 million HIV-positive people with antiretroviral (ARV) therapy and
3.6 million people infected with TB using the Directly Observed Treatment Short-
Course (DOTS) (Table 1).2 The Fund does not project how many malaria treatments
it will have supported, though it anticipates financing the purchase and distribution of
40.0 million insecticide-treated bed nets (ITN) to prevent malaria infection. The Fund
projects that 52 million people will have been reached through voluntary HIV
counseling and testing (VCT) services, and 0.5 million orphans will have been
supported.
Table 1. Global Fund Targets: 2004-2009
(thousands of people and nets)
2004
2005
2006
2007
2008
2009
People Treated for HIV/AIDS
120
350
600
870
1,200
1,600
People Treated for TB
300
700
1,200
1,800
2,600
3,600
ITNs Distributed
2,000
5,000
15,000
30,000
60,000 100,000
Source: Global Fund, Partners in Impact Results Report 2007
1 An extensive discussion on the structure and procedures of the Fund is included in CRS
Report RL31712, The Global Fund to Fight AIDS, Tuberculosis, and Malaria: Background.
2 Directly Observed Treatment Short Course(DOTS) is an internationally-recommended TB
control strategy. [http://www.who.int/tb/dots/en/]

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CRS-2
Global Fund Progress to Date
About 57% of Global Fund grants support HIV/AIDS projects, an estimated 15%
fund TB initiatives; some 27% sustain malaria programs; and 1% strengthen health
systems.3 In December 2006, the Fund and the U.S. State Department's Office of the
Global AIDS Coordinator (OGAC) released a joint statement estimating that the Fund
and the President's Emergency Plan for HIV/AIDS (PEPFAR)4 have supported the
provision of antiretroviral treatments to 1.2 million people; of which the Fund claimed
supporting treatment for 770,000 HIV-positive people (Table 2). The Fund also
reported treating 2 million people with TB under DOTS and 23 million people with
malaria.5 The Fund supported treatment for an additional 8,600 people with multiple-
drug resistant TB (MDR-TB) – not reflected in Table 3. According to a Global Fund
report, in 2005, its assistance represented more than 20% of all international
HIV/AIDS spending, some 67% of global TB funds, and about 64% of all
international support for malaria efforts.6
Table 2. Results of Global Fund Grants to Date
(thousands of people and nets)
Intervention
December 2004 December 2005 December 2006
People Treated for HIV/AIDS
130
384
770
People Treated for TB
385
1,000
2,000
People Treated for Malaria
1,100
3,900
23,000
Malaria: ITNs Distributed
1,350
7,700
18,000
Source: Global Fund Newsletter, December 2006 and 2007 Partners in Impact Results Report.7
Note: The figures should not be added; they reflect an accumulation of the previous year's efforts.
3 Global Fund website, "Distribution of Funding After Six Rounds." Accessed on May 11,
2007. [http://www.theglobalfund.org/en/funds_raised/distribution/#expenditure_target]
4 For more information on PEPFAR, see CRS Report RL33771, Trends in U.S. Global AIDS
Spending: FY2000-FY2007 and CRS Report RL33485, U.S. International HIV/AIDS,
Tuberculosis and Malaria Spending: FY2000-FY2008.
5 [http://www.theglobalfund.org/en/media_center/press/pr_061201.asp] and Global Fund,
Partners in Impact: Results Report 2007.
6 Global Fund, Resource Needs for the Global Fund: 2008-2010. 2007.
[http://www.theglobalfund.org/en/files/about/replenishment/oslo/Resource%20Needs.pdf]
The Henry J. Kaiser Family Foundation (KFF) estimates that Global Fund spending
represented about 19% of all international HIV/AIDS commitments in 2005. KFF,
International Assistance for HIV/AIDS in the Developing World. July 2006.
[http://www.kff.org/hivaids/upload/7344-02.pdf]
7 All data, excluding the malaria treatment figures, were compiled from Global Fund,
Partners in Impact: Results Report 2007. Malaria figures were compiled from the 9th
Global Fund Newsletter, December 2006 and from Global Fund staff.
[http://www.theglobalfund.org/en/files/malaria_information_sheet_en.pdf]

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CRS-3
Funding Procedure
Each year, the Global Fund calls for grant proposals and awards them in Rounds.
Through six Rounds, the Fund has approved more than $7 billion, almost half of
which has been disbursed, in support of more than 400 grants in 136 countries (Table
3).8 The Fund issued its seventh call for proposals on March 1, 2007. In 2005, the
Fund approved Round 5 grants in two tranches, because initially there were not
sufficient donor pledges to approve all recommended proposals. Its Comprehensive
Funding Policy (CFP) specifies that the Fund can only sign grant agreements if there
are sufficient resources to support the first two years of the activities. The policy is
designed to avoid disruptions in funding that might interrupt project activities.
Financial delays can cause people to miss treatments, potentially leading to the
emergence of drug-resistant strains, susceptibility to secondary diseases, or death.
Table 3. Grant Agreement Totals to Date
($millions, current )
Grants Approved
Funds Disbursed
Phase I
Phase II
Total
Phase I
Phase II
Total
Round 1
$576.3
$735.4
$1,311.7
$540.9
$303.9
$844.8
Round 2
$851.6
$917.2
$1,768.8
$779.8
$264.6
$1,044.4
Round 3
$636.3
$613.7
$1,250.0
$563.0
$98.4
$661.4
Round 4
$1,014.2
$581.6
$1,595.8
$772.1
$14.6
$786.7
Round 5
$773.4
$0.0
$773.4
$312.7
$0.0
$312.7
Round 6
$870.6
$0.0
$870.6
$12.9
$0.0
$12.9
TOTAL
$4,722.4
$2,847.9
$7570.3
$2,981.4
$681.5
$3,662.9
Source: Global Fund website, Current Grant Commitments and Disbursements. May 11, 2007.
The Fund distributes grants through a performance-based funding system. Under
this system, the Fund commits to financially support the first two years (Phase I) of
approved grants, though it disburses the funds quarterly if grants meet their targets.
As the end of Phase I approaches, the Fund reviews the progress of the grant to
determine if it should support the third through fifth years (Phase II).
In November 2006, the Board established the Rolling Continuation Channel
(RCC). This funding channel, which began in March 2007, permits Country
Coordinating Mechanisms (CCMs)9 to request additional funding for grants that are
8 Global Fund website, Current Grant Commitments and Disbursements. Accessed on May
11, 2007. [http://www.theglobalfund.org/en/funds_raised/commitments/]
9 CCMs are comprised of individuals from governments, NGOs, the private sector, and
(continued...)

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CRS-4
performing well but set to expire. The application process for the RCC is not as
rigorous as the Round process. RCC-approved grants can receive support for up to
an additional six years, with the funds being awarded in three-year intervals. The
channel is intended only for those grants that have demonstrated a significant
contribution "to a national effort that has had, or has the potential to have in the near
future, a measurable impact on the burden of the relevant disease."10
Suspended, Discontinued, or Cancelled Grants
The Fund uses a performance-based funding system that permits it to temporarily
suspend support for grants if it finds significant problems with project performance,
such as accounting inconsistencies. In some instances, the Fund restored support to
grants once key concerns were resolved. The Fund will discontinue support for grants
in Phase II if it finds that they did not sufficiently meet their targets. Countries whose
grants have been discontinued can apply and have secured funding in subsequent
Rounds (see Nigeria below). In extreme cases, the Fund will immediately cancel
financial support. If funds are immediately revoked, the Fund might invoke its
continuity of services policy, which ensures that life-extending treatment is continued
for suspended or cancelled grants or for those whose terms have expired until other
financial support is identified.11 To date, the Fund has only terminated grants in two
countries, Burma and North Korea. When the Fund decided to terminate support for
grants in Burma, policy analysts debated how best to serve humanitarian needs in
politically unstable countries.
Suspended Grants
Chad. On November 28, 2006, the Global Fund announced that it had
temporarily suspended its two grants in Chad. After undertaking audits of the grants,
the Fund reportedly discovered evidence of "misuse of funds at several levels and the
lack of satisfactory capacity by the Principal Recipient and sub-recipients to manage
the Global Fund’s resources." The Fund noted, however, that despite the findings,
grant activities had yielded substantial results in terms of people reached, infections
prevented, and lives saved. Grant disbursements have been suspended until a
satisfactory new financial structure can be developed. In the interim period, the Fund
is working with the Principal Recipient to ensure that life-saving treatment and other
essential services for people in need are not interrupted.
Ukraine. On January 30, 2004, the Global Fund announced that it had
temporarily withdrawn its grant in Ukraine. Citing the slow progress of Fund-backed
9 (...continued)
affected populations. The CCMs develop and submit grant proposals to the Fund. After
grant approval, they oversee progress during implementation.
10 [http://www.theglobalfund.org/en/files/boardmeeting14/GF-BM-14_Final_Decisions.pdf]
11 Global Fund 14th Board Meeting Report, October31- November 3, 2006.
[http://www.theglobalfund.org/en/files/boardmeeting14/GF-B14-7_Report%20of%20the
%20PSC_FINAL.pdf]

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CRS-5
HIV/AIDS programs, the Fund stated that it would ask “a reliable organization to take
over implementation of the programs for several months, to give Ukraine the
opportunity to address concerns of slow implementation, management, and
governance issues.”12 Nearly a month later, on February 24, 2004, the Fund
announced that the suspension had ended, and that a temporary principal recipient had
been identified. The Fund hoped that if a new PR were used, project performance
would improve and related problems would be resolved.13 The Fund reports that the
new PR is successfully implementing the grant and in July 2005, it approved
additional funds for the grant's Phase II activities.14
Discontinued Grants
Nigeria. In May 2006, at its 13th board meeting, the Fund decided to discontinue
support for Nigeria's HIV/AIDS programs awarded in Round 1. In previous board
meetings, the Secretariat recommended that the Fund not award Nigeria additional
support for Phase II.15 The Board disagreed. At the 12th Board meeting, the Board and
Secretariat agreed to create an Independent Review Panel to review the grants and
report back to the Board. Following its investigation, the Panel presented similar
findings and agreed with the Secretariat that the grants were performing poorly . The
Board agreed not to fund Phase II of the grants, but committed to support procurement
of HIV treatments for up to two years. Although those grants were discontinued, the
Fund awarded Nigeria different HIV/AIDS grants in Round 5.16
Pakistan. Staff at the Global Fund report that the Fund discontinued support
for Pakistan's malaria projects in Round 2, because the grant demonstrated weak
project implementation, slow procurement of health products, poor data quality, and
slow spending of project funds. Specifically, the Secretariat found that eight of the
12 Global Fund Press Release, The Global Fund Acts to Secure Results for its Programs in
Ukraine. January 30, 2004. [http://www.theglobalfund.org/en/media_center/press/
pr_040130.asp]
13 Global Fund Press Release, Global Fund Signs Letter of Intent to Relaunch Ukraine
HIV/AIDS Grant. February 24, 2004. [http://www.theglobalfund.org/en/media_center/
press/pr_040224.asp]
14 Correspondence with Global Fund staff, May 11, 2007.
15 For information on the functions of the Board and Secretariat see CRS Report RL31712,
The Global Fund to Fight AIDS, TB, and Malaria: Background.
16 The report from the Communities Living with HIV/AIDS, TB and Affected by Malaria
to the Global Fund at the 13th Board meeting,
[http://www.theglobalfund.org/en/files/partners/civil_society/articles/report_communitie
s_bm13.pdf] Also see the Global Fund report on the 14th Board meeting at
[http://www.theglobalfund.org/en/files/boardmeeting14/GF-BM-14_04_OperationsUpda
te.pdf]

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CRS-6
grant's ten targets17 had not been reached and only 15% of the ITNs had been
distributed.18
Senegal. On March 1, 2005, the Global Fund announced that it would not
approve funding for the second phase of Senegal’s malaria project, which was
originally funded in Round 1. A Fund press release indicated that the project “was
found to have systemic issues that resulted in poor performance.”19 The release did
not specify what issues it had with the project, though it indicated that “review of the
Senegal grant raised serious concerns” about the effective use of Global Fund
resources. Although the program was discontinued, Fund officials encouraged
Senegal to address the issues that were raised and to apply for new funds in the future.
Ultimately, the Fund approved a grant proposal that Senegal submitted for malaria
projects in Round 4.
South Africa. In December 2005, the Global Fund Board voted to discontinue
funding an HIV prevention grant in South Africa. The Board decided that the grant,
implemented by an NGO named loveLife, had failed to sufficiently address
weaknesses in its implementation.20 Press accounts quote a Global Fund
representative explaining that it had become difficult to measure how the loveLife
prevention campaign was contributing to the reduction of HIV/AIDS among young
people in South Africa. Additionally, the representative reportedly stated that the
Board had repeatedly requested that loveLife revise its proposals and address concerns
regarding performance, financial and accounting procedures, and the need for an
effective governance structure. A Global Fund spokesman was quoted as saying that
“loveLife is extremely costly, there are programs that have been very effective, which
cost a fraction of what loveLife costs. It would be irresponsible of the Global Fund
to spend almost $40 million without seeing results.”21
LoveLife officials were reportedly surprised that the Global Fund ultimately
decided to discontinue funding the grant, particularly since there were some reported
differences of opinion regarding the matter between the Fund’s Technical Review
Panel, Secretariat, and the Board.22 Additionally, loveLife officials reportedly argued
that the decision was politically motivated and influenced by U.S. emphasis on
17 For a description of the targets, see
[http://www.theglobalfund.org/search/docs/2PKSM_130_144_full.pdf]
18 Correspondence with the Global Fund on April 13, 2007.
19 Global Fund Press Release, Global Fund Cuts Funding for Malaria Grant. March 1,
2005. [http://www.theglobalfund.org/en/media_center/press/pr_050301.asp]
20 Global Fund Press Release, “Global Fund Closes Funding Gap.” December 16, 2005.
[http://www.theglobalfund.org/en/media_center/press/pr_051216.asp]
21 UN Integrated Regional Information Networks, “South Africa: Global Fund Withdraws
Support for LoveLife.” December 19, 2005. [http://www.plusnews.org]
22 loveLife officials allege that after reviewing the revised proposal that loveLife submitted,
the TRP recommended that the Board fund the proposal. See loveLife press release,
“Statement by loveLife on the Decision by the Global Fund to Fight HIV/AIDS, TB, and
Malaria to Discontinue Funding.” December 21, 2005. [http://www.lovelife.org.za/
corporate/media_room/article.php?uid=805]

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CRS-7
abstinence in HIV prevention efforts. One press account quoted a loveLife official as
saying, “Obviously the strength of conservative ideologies is spilling over into the
field of HIV and HIV prevention and it has direct impact on programs like loveLife.”23
According to a loveLife press release, the decision to discontinue funding the program
will substantially curtail South Africa’s efforts to prevent HIV infections among
young people, because the Global Fund’s grant supported one third of the program’s
budget. However, the South African government has reportedly provided additional
funds to the program to close the funding gap, and other donors, such as the U.S.-
based Kaiser Family Foundation, have continued funding loveLife HIV-prevention
efforts.
Uganda. On August 24, 2005, the Global Fund announced that it had
temporarily suspended all five of its grants in Uganda. Additionally, the Fund
declared that the Ugandan Ministry of Finance would have to establish a new structure
that would ensure effective management of the grants before it considered resuming
support. In a press release, the Fund explained that a review undertaken by
PricewaterhouseCoopers revealed serious mismanagement by the Project Management
Unit (PMU) in the Ministry of Health, which was responsible for overseeing the
implementation of Global Fund programs in Uganda. Examples of “serious
mismanagement” included evidence of inappropriate, unexplained or improperly
documented expenses.24 Up to that point the Fund had disbursed some $45.4 million
of the $200 million approved.25 Three months later on November 10, 2005, the Fund
announced that it had lifted the suspension on all five grants. The PR and the Ministry
of Finance committed to restructure management of the grants and strengthen
oversight and governance of Global Fund grants to Uganda.26 In spite of these actions,
the Fund did not approve support for Phase II activities.
Terminated Grants
Burma (Myanmar). After extensive consultation with the U.N. Development
Program (UNDP), the Fund decided to terminate its grant agreements with Burma
effective August 18, 2005. The Fund stated that while it was concerned about the
extensive humanitarian needs in Burma, travel restrictions imposed by the country’s
government prevented the Fund from effectively implementing grants.27 According
23 Quin, Andrew, “S. Africa youth AIDS program faces cash crunch.” January 4, 2006.
Reuters Foundation. [http://www.alertnet.org]
24 Global Fund press release, “Global fund Suspends Grants to Uganda.” August 24, 2005.
[http://www.theglobalfund.org/en/media_center/press/pr_050824.asp]
25 Kaiser Family Foundation, “Global Fund Temporarily Suspends Five Grants to Uganda
Citing Evidence of Mismanagement.” August 25, 2005. [http://www.kaisernetwork.org/
daily_reports/print_report.cfm?DR_ID=32229&dr_cat=1]
26 Global Fund press release, “Global Fund Lifts Suspension of Uganda Grants.” November
10, 2005. [http://www.theglobalfund.org/en/media_center/press/pr_051110.asp]
27 Global Fund Press Release, The Global Fund Terminates Grants to Myanmar. August 19,
2005. [http://www.theglobalfund.org/en/media_center/press/pr_050819.asp] Also see
Global Fund Fact Sheet, Termination of Grants to Myanmar. August 18, 2005.
(continued...)

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CRS-8
to the Fund, travel clearance procedures that the Burmese government instituted in
July 2005 prevented the PR, implementing partners, and Global Fund staff from
accessing grant implementation areas. The Fund indicated that the travel restrictions
coupled with new procedures that the government established to review procurement
of medical and other supplies “prevented implementation of performance-based and
time-bound programs in the country, breached the government’s commitment to
provide unencumbered access, and frustrated the ability of the PR to carry out its
obligations.”28
The Global Fund’s decision to discontinue those grants in Burma sparked a larger
debate about providing humanitarian assistance in countries that are politically
unstable or governed by dictatorial regimes. Some were disappointed that the Fund
terminated its assistance, citing the significant humanitarian needs in the country. A
Burmese official stated that, “the restrictions on aid workers were only temporary, and
‘do not justify irreversible termination of grants.’”29 A U.N. official accused the
United States of pressuring the Global Fund to withdraw its support in Burma.30 One
U.N. official warned of impending death as a result of the situation, stating that,
“without exaggeration, people are going to die because of this decision.”31 Some,
however, blamed the Burmese government for the Fund's decision to terminate the
grants. One Washington-based advocate stated that, “it needs to be recognized who
causes suffering in that country. It’s not the Global Fund...It’s the regime.”32 A
Global Fund spokesperson stressed that the interrupted aid was not a political
decision, rather one based on effective project implementation.33
Burma has garnered support from other countries and international organizations
to continue programs terminated by the Fund. Australia is reportedly increasing its
aid to Burma by 25%.34 Additionally, the European Union (EU) announced that it had
pledged about $18 million to fight HIV/AIDS in the country.35 In January 2006,
27 (...continued)
[http://www.theglobalfund.org/en/media_center/press/pr_050819_factsheet.pdf]
28 Global Fund Press Release, The Global Fund Terminates Grants to Myanmar. August 19,
2005. [http://www.theglobalfund.org/en/media_center/press/pr_050819.asp]
29 “Burma urges UN aid fund to stay.” BBC News, August 23, 2005. [http://news.bbc.co.uk/]
30 “Australia to step up AIDS assistance to Burma.” Australian Associated Press, December
7, 2005. [http://aap.com.au/]
31 “Misery spreads among political stalemate.” The Miami Herald, December 29, 2005.
[http://www.miami.com/mld/miamiherald/]
32 “So Much Need, So Little Help for the Deathly Ill in Myanmar.” The Los Angeles Times,
December 27, 2005. [http://www.latimes.com/]
33 Ibid.
34 “Australia to step up AIDS assistance to Burma.” Australian Associated Press, December
7, 2005. [http://aap.com.au/]
35 “EU Humanitarian aid to Myanmar increases fourfold.” Associated Press, December 12,
2005. [http://www.ap.org] and "Commission allocates 15 million in humanitarian aid to
vulnerable populations in Burma/Myanmar and to Burmese refugees along the Myanmar-
(continued...)

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CRS-9
Australia, Britain, Sweden, the Netherlands, Norway, and the European Commission
announced that they planned to establish a $100 million, five-year joint donor program
that would replace some of the financial support the country lost after the Fund had
withdrawn. The program, the Three Diseases Fund (3D Fund), was officially
launched in October 2006.36 The donors contend that the funding system maintains
the safeguards established by the Global Fund that ensures the money does not directly
support the military regime.
North Korea. In January 2005, the Global Fund cancelled two grant
agreements with North Korea after the country failed to meet the requirements
outlined in its Additional Safeguards Policy.37 The grants, valued at $8.5 million,
were targeted at controlling and malaria in the country. No further information is
publically available.
Projected Financial Needs
Meeting Millennium Development Goals
In September 2000, at the United Nations (U.N.) Millennium Summit, member
states adopted the U.N. Millennium Declaration, which among other things,
established a set of time-bound, measurable goals and targets for combating poverty,
hunger, disease, illiteracy, environmental degradation and discrimination against
women.38 This resolution contains what have become commonly known as the
Millennium Development Goals (MDGs).39
World leaders who agreed to the MDGs pledged to provide sufficient financial
and technical support to meet the goals. Of the eight goals, the one aimed at
HIV/AIDS and malaria commits world leaders to reverse the spread of the two
diseases by 2015. The World Health Organization (WHO) and the Joint United
Nations Program on HIV/AIDS (UNAIDS) estimate that in order to meet the MDG
goal related to HIV/AIDS and malaria, in each year from 2008 to 2010, donors would
35 (...continued)
Thai border." European Commission press release, December 22, 2005.
[http://europa.eu/rapid/pressReleasesAction.do?reference=IP/05/1694&format=HTML&
aged=0&language=EN&guiLanguage=en]
36 “European donors plan to restore AIDS help to Myanmar: diplomats.” Agence France
Press, January 24, 2006. [http://www.afp.com/english/home/] and "Myanmar's HIV/AIDS,
Malaria, TB Fund To Begin Operations on Oct. 12." Kaiser Family Foundation, October 12,
2006. [http://www.kaisernetwork.org/daily_reports/rep_index.cfm?hint=1&DR_ID=40356]
37 Global Fund, Report of the Executive Director, April 21-22, 2005.
[http://www.theglobalfund.org/en/files/boardmeeting10/gfb1003..pdf]
38 [http://www.un.org/millennium/declaration/ares552e.pdf]
39 [http://www.un.org/millenniumgoals/MDGs-FACTSHEET1.pdf]

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CRS-10
need to provide between $28 billion and $31 billion.40 The Global Fund estimates that
during that time period, its annual share would range from $4 billion to $6 billion.
Meeting Escalating Grant Requests
The Fund estimates that it will need between $11 billion and $18 billion from
2008 to 2010.41 The range represents the rate at which grant approval could escalate
in three different scenarios (Table 4). In Scenario A, the Global Fund would continue
to award new grants at the current rate of about $1 billion per year and would not
experience significant growth. In Scenario B, the Fund would moderately increase
new grant awards, with annual grant awards averaging $5 billion from 2008 to 2010.
In Scenario C, the Fund projects that it would meet the MDGs and would need an
average of $6 billion for each year from 2008 to 2010. The Global Fund does not
advocate any scenario, because it bases its financial needs on the grant proposals that
it receives.42 However, at a board meeting in April 2007, the Board estimated that it
would need from $6 billion to $8 billion by 2010 – reflecting Scenarios B and C.43
Table 4. Funding Requirements, 2008-2010
($billions, current)
2008
2009
2010
TOTAL
Phase I Phase II RCC Phase I Phase II RCC Phase I Phases II RCC
Scenario A
$1.7
$1.3
$0.3
$1.8
$1.7
$0.4
$1.6
$2.1
$0.6
Subtotal
$3.3
$3.9
$4.3
$11.5
Scenario B
$2.3
$1.3
$0.3
$2.9
$1.7
$0.4
$3.2
$2.2
$0.6
Subtotal
$3.9
$5.0
$6.0
$14.9
Scenario C
$2.8
$1.3
$0.3
$3.9
$1.7
$0.4
$4.7
$2.2
$0.6
Subtotal
$4.4
$6.0
$7.5
$17.9
Source: Global Fund, Resource Needs for the Global Fund: 2008-2010.
Congressional Actions
At the launching of PEPFAR, the Administration proposed that over the Plan's
five-year term, $1 billion be contributed to the Global Fund. In total, the
Administration has requested $1.3 billion for the Fund from FY2004 to FY2008; $200
40 Global Fund, Partners in Impact Results Report 2007.
41 Global Fund, Resource Needs for the Global Fund: 2008-2010.
[http://www.theglobalfund.org/en/files/about/replenishment/oslo/Resource%20Needs.pdf]
42 Correspondence with Global Fund staff, May 1, 2007.
43 Ibid.

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CRS-11
million in FY2004 and FY2005, each, and $300 million for each fiscal year from 2006
to 2008. Congress has consistently provided more to the Fund than the
Administration has requested through PEPFAR, appropriating nearly $3 billion from
FY2004 through FY2007 (Table 5). P.L. 109-289, the FY2007 Revised Continuing
Appropriations Resolution, as amended, provides the largest appropriation to the Fund
to date, $724 million, of which $247.5 million is from USAID, $377.5 million from
the State Department, and $99 million from HHS.
Table 5. U.S. Appropriations to the Global Fund
($millions, current)
FY2001- FY2003 FY2004 FY2005 FY2006 FY2007 FY2007 FY2001-
FY2008
FY2002
Actual
Actual
Actual
Actual
Request
Actual
FY2007
Request
Actual
Total
Foreign
$320.0
$248.4
$397.6
$248.0
$445.5
$200.0
$625.0
$2,284.5
0.0
Operations
Labor/HHS
$100.0
$99.3
$149.1
$99.2
$99.0
$100.0
$99.0
$645.6
$300.0
FY2004
n/a
n/a
-$87.8
$87.8b
n/a
n/a
n/a
n/a
n/a
Carryover
TOTAL a
$420.0
$347.7
$458.9
$435.0
$544.5
$300.0
$724.0
$2,930.1
$300.0
Source: Appropriations legislation and budget requests
a. The Global Fund reports having received less from the United States than what was included in appropriations.
The Global Fund reports having received $300 million in FY2001 and FY2002 combined, $322.7 million in
FY2003, $458.9 million in FY2004, $414.0 million in FY2005, and $401.7 million in FY2006. Language in
PL. 108-25 authorizes the President to withhold a portion of U.S. funds from the Fund that might be spent in
countries that support terrorism. In FY2005, Foreign Operations appropriations provides for the United States
to transfer 5% of funds appropriated to the Fund to support USAID technical assistance efforts related to the
Fund. In FY2006, Foreign Operations appropriations language requires the Secretary of State to withhold 20%
of the U.S. Global Fund contribution until she certifies to the Appropriations Committees that the Fund has
strengthened oversight and spending practices.
b. The withdrawal of $87.8 million in FY2004 illustrated in Table 5 reflects requirements in P.L.108-25, U.S.
Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003, which stipulates that U.S. contributions
to the Fund for fiscal years 2004 through 2008 not exceed 33% of Fund contributions from all sources
(discussed below). P.L. 108-447, FY2005 Consolidated Appropriations, adds this amount to the 2005
contribution, subject to the same 33% limitation.
Issues for Congress
Strengthen Reporting and Monitoring
Some critics of the Fund have expressed concern about particular aspects of the
Fund's financial policies. Observers contend that the Fund’s oversight mechanisms
are not strong enough to protect against wasteful spending, particularly in countries
that have a well documented history of corruption and poor financial management.
Fund supporters counter that the organization's website provides an abundance of
information related to its funding process, grant project proposals and budgets, grant

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CRS-12
spending trends, and results of board meetings, which include decisions regarding the
suspension of grants. Fund advocates also argue that the Fund's decisions to suspend
temporarily, and in some cases, discontinue poor performing grants demonstrate the
effectiveness of the Fund's oversight and funding mechanisms.
In June 2005, the U.S. Government Accountability Office (GAO) reported that
the Fund had a limited capability to monitor and evaluate grants, raising questions
about the accuracy of its reported results. GAO also indicated that the Fund's
documents had not consistently explained why it provided additional funds for grants
or why it denied disbursement requests.44 In October 2006, the Center for Global
Development (CGD) Global Fund Working Group reported similar findings and made
a number of recommendations, including strengthening the performance based
funding system.45
In an effort to strengthen oversight of the Fund's grants, Congress included a
provision in Section 525 of P.L. 109-102, FY2006 Foreign Operations Appropriations,
that required 20% of the U.S. contribution to the Global Fund be withheld until the
Secretary of State certified to the Appropriations Committees that the Fund had
undertaken a number of steps to strengthen oversight and spending practices. The act
allows the Secretary to waive the requirement, however, if she determines that a
waiver is important to the national interest. At a hearing on tuberculosis held in
March 2007 by the House Foreign Affairs Subcommittee on Africa and Global Health,
Representative Adam Smith expressed his reservations about the Fund's oversight
capacity, stating that
The information and accountability that Congress has come to take for granted
through bilateral programs are not available through the Global Fund, and that
many of the primary recipients of the Global Fund grants are governments with
a history of corruption and fraud and/or limited capacity to properly manage large
sums of money in their health sectors. One could argue that the absence in the
Global Fund of a robust reporting and monitoring mechanism, at both the primary
and sub- recipient levels, is an open invitation for waste in these countries and a
tragic loss of opportunity to save lives. The implementation of a system that
provides accountability and transparency would seem vital, absolutely necessary,
in my view, to continue the expanded donor support of the Global Fund in the
future.
GAO re-evaluated the Fund and released a report in May 2007, which
acknowledged that the Fund had improved its documentation of funding decisions, but
also determined that the process needed improvement.46 The updated report indicated
44 GAO, The Global Fund to Fight AIDS, TB, and Malaria is Responding to Challenges but
Needs Better Information and Documentation for Performance-Based Funding. June 2005.
[http://www.gao.gov/new.items/d05639.pdf]
45 Report of the Global Fund Working Group, Challenges and Opportunities for the New
Executive Director of the Global Fund: Seven Essential Tasks. CGD. October 2006.
[http://www.cgdev.org/doc/HIVAIDSMonitor/GlobalFund_sevenTasks.pdf]
46 GAO, Global Fund to Fight AIDS, TB, and Malaria Has Improved Its Documentation of
Funding Decisions but Needs Standardized Oversight Expectations and Assessments, May
(continued...)

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CRS-13
that each grant that it had reviewed included an explanation of associated funding
decisions; yet GAO maintained that many of the grant reports did not include a
justification that detailed how the Fund had decided whether to disburse funds or
renew support, as it had found in 2005. GAO also concluded that the Fund needed to
strengthen oversight of Local Fund Agents (LFAs) and establish standardized
performance standards for them in order to assess the quality of their grant monitoring
and reporting.47 Some would like Congress to include provisions in subsequent
appropriations bills that are similar to those enacted in FY2006, which permitted the
Administration to withhold a portion of the United States' contributions to the Fund
pending review of oversight and monitoring practices. Others contend that such
action is unnecessary in light of the strides that the Fund has made in improving its
reporting and monitoring practices.
Reauthorize Limits on U.S. Contributions to the Global Fund
P.L. 108-25, U.S. Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act,
prohibits U.S. government contributions to the Fund from exceeding 33% of
contributions from all donors. Congress instituted the contribution limit to encourage
greater global support for the Fund. There is some debate about whether the 33%
provision should be interpreted as the amount the United States should provide to the
Fund or as the maximum amount the United States can contribute. Supporters of the
Fund contend that Congress instituted the 33% mandate in recognition of the moral
responsibility that the United States holds as one of the wealthiest countries in the
world. Opponents of this idea assert that if U.S. contributions to the Fund were to
reflect its share of the global economy, then U.S. contributions would and should
range from 20% to 25% of all contributions.
Some Global Fund advocates who disparage the 33% restriction argue that the
differing fiscal cycles of the Fund and the United States complicate efforts to leverage
support. Opponents to the 33% restriction contend that the requirement is harmful to
the Fund, because the U.S. fiscal year concludes some three months before the Fund's.
Critics most often point to FY2004 to substantiate their position. In that fiscal year,
nearly $88 million of the U.S. contribution was withheld from the Fund to prevent the
funds from exceeding 33%. Advocates of the restriction assert that the 33% cap was
intended to suspend portions of U.S. contributions, where necessary. Proponents of
the cap note that the Fund was not significantly affected, as the withheld portion was
released at the end of the calendar year, when the Fund secured sufficient funds to
match the U.S. contribution. Supporters of the provision contend that the Fund
benefits from the policy, because it encourages other donors to increase their
contributions, as happened in FY2004. U.S. contributions to the Fund have not yet
reached 33% (Table 6).
46 (...continued)
2007. [http://www.gao.gov/new.items/d07627.pdf]
47 The Global Fund does not maintain staff in recipient countries. Instead, it hires Local
Fund Agents to oversee, verify and report on grant performance.
[http://www.theglobalfund.org/en/about/structures/lfa/]

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CRS-14
Table 6. U.S. Appropriations to the Fund as a Percentage of All
Fund Contributions
($millions, current and percentages)
FY2004
FY2005 FY2006 FY2007
Actual
Actual
Actual
CR
U.S. Appropriations to the Global Fund
$458.9
$435.0a
$544.5
$724.0
All Contributions to the Global Fund
$1,476.3 $1,498.3 $2,056.0 $2,261.6
U.S. Government Contributions as % of All
31.1%
29.0%
26.5%
32.0%
Contributions
Sources: Appropriations and Global Fund, Pledges and Contributions, April 18, 2007.
a. According to the Global Fund website, the United States only contributed $414.0 million in FY2005.
Appropriators provided $435.0 million in that fiscal year.
Debate on the 33% contribution cap has also focused on the limited amount of
support that the private sector and others have provided to the Fund (Table 7). Since
its inception, the Fund has struggled to secure support from non-government donors.
The Bill & Melinda Gates Foundation remains the largest single contributor among
non-government donors. To date, the foundation has provided about 92% ($650
million) of all non-governmental pledges ($707 million) and contributed some 93%
($350 million) of all payments to the Fund by non-governmental donors ($376
million).48 Some Fund supporters had hoped that the Product Red campaign, launched
in January 2006 by co-founder Bono,49 would lead to significant increases in
contributions made by the private sector.50 To date, Product Red has contributed
$19.2 million to the Fund, comprising about 5% of non-government contributions.
48 Global Fund. [http://www.theglobalfund.org/en/files/pledges&contributions.xls]
49 Stage name for singer, Paul David Henson.
50 The initiative is a branding mechanism which commits companies that use the Product
Red brand to share a percentage of their profits with the Fund. [http://www.joinred.com/]

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CRS-15
Table 7. Total Global Fund Contributions and Pledges
($billions, current)
Contributed
% of Total
Pledges
% of Total
to Date
Paid
Pledges
United States
$1.90
26.76%
$2.96a
28.63%
European Union
$2.82
39.72%
$4.30
41.59%
European Commission
$0.64
9.01%
$0.72
6.96%
Other Countries
$1.36
19.16%
$1.65
15.96%
Non-Governmental Donors
$0.38
5.35%
$0.71
6.86%
Total
$7.10
100.00%
$10.34
100.00%
Source: Global Fund, Pledges and Contributions, April 18, 2007.
a. Includes FY2008 $300 million request.
Appropriations to the Fund Versus Bilateral HIV/AIDS Efforts
The Administration has argued that any amount that Congress provides to the
Global Fund in excess of its request skews the appropriate balance of aid that the
United States should provide to the Fund and other bilateral HIV/AIDS efforts. At a
FY2005 Senate Appropriations Committee hearing in May 2004, then-Global AIDS
Coordinator Ambassador Randall Tobias argued that the “incremental difference
between what the Administration requested and what was appropriated to the Fund
is money that might have been available” for U.S. bilateral programs.51 Although
appropriations to the Fund have been increasing, the percentage of U.S. global
HIV/AIDS, TB, and malaria appropriations provided for U.S. contributions have
remained mostly level (Table 8 and Figures 1 and 2).
Fund supporters counter that appropriations made to the Fund in excess of
requested levels better reflect what the United States should provide and complement
U.S. bilateral HIV/AID programs, particularly since the Administration and the Fund
have strengthened their coordination. U.S. officials acknowledge that though the
Fund is a critical part of PEPFAR, when making appropriations, Congress should
consider the pace at which the Fund can distribute funds. The Office of the Global
AIDS Coordinator (OGAC) has cited an instance when PEFPAR used some of its
funds to purchase ARVs for a Global Fund project that faced financial delays.52
51 Senate Appropriations Committee hearing on FY2005 appropriations, May 18, 2004.
52 OGAC, The Power of Partnerships: Third Annual Report to Congress on PEPFAR, p.74.

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CRS-16
Table 8. Total U.S. Global HIV/AIDS, TB, and Malaria
Appropriations
($millions, current and percentages)
FY2004 FY2005 FY2006 FY2007 FY2008
Actual Actual Actual
CR
Request
Global Fund
458.9
435.0
544.5
724.0
300.0
Other Bilateral HIV/AIDS, TB, and
1,888.0 2,472.4 2,868.0
4,074.3 5,476.9
Malaria Programs
TOTAL
2,346.9 2,907.4 3,412.5
4,798.3 5,776.9
% of U.S. Global HIV/AIDS, TB, and
19.6%
15.0%
16.0%
15.1%
5.2%
Malaria Programs Provided to the Fund
Sources: Prepared by CRS from appropriations legislation figures and interviews with
Administration staff.
Note: Spending on U.S. global HIV/AIDS, TB, and malaria efforts that is not specified in
appropriations language is not included in this chart, such as those amounts spent on CDC's
international HIV prevention research and global TB and malaria initiatives.
Figure 1. U.S. Contributions to the Fund and All U.S. International
HIV/AIDS, TB, and Malaria Spending
Source: Prepared by CRS from appropriations legislation figures.

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CRS-17
Figure 2. U.S. Contributions to the Fund as a Percentage of All U.S.
International HIV/AIDS, TB, and Malaria Spending
Source: Prepared by CRS from appropriations legislation figures.

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CRS-18
Glossary of Abbreviations and Acronyms
3D Fund
Three Diseases Fund
ACT
Artemisinin-based Combination drug Treatment
ARV
Antiretroviral Therapy
CCM
Country Coordinating Mechanism
CGD
Center for Global Development
DOTS
Directly Observed Treatment Short-Course
EU
European Union
GAO
U.S. Government Accountability Office
ITN
Insecticide-Treated Net
MDR-TB
Multi-Drug Resistant Tuberculosis
NGO
Non-Governmental Organization
OGAC
Office of the Global AIDS Coordinator
PEPFAR
President's Emergency Plan for AIDS Relief
PR
Principal Recipient
RCC
Rolling Continuation Channel
TB
Tuberculosis
UN
United Nations
UNDP
United Nations Development Program
VCT
Voluntary Counseling and Testing

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