In January 2025, Bloomberg reported on deeply concerning behaviour at several private hospitals, from Uganda to the Philippines, supported by funds from the International Finance Corporation (IFC), the World Bank’s private investment arm. These hospitals, when faced with people unable to pay user fees, reportedly denied emergency care, detained patients and even kept corpses until payment was received, driving families into poverty. This exposé complements previous Oxfam research (see Observer Spring 2024).
Strategies to fund the achievement of the Sustainable Development Goals (SDGs) have helped transform traditional official development assistance (ODA) mechanisms into financialisation modalities – i.e. economic restructuring in the financial sector’s interest (see Report, Financialisation, human rights and the Bretton Woods Institutions: An introduction for civil society organisations). Over the past two decades, essential services financing has shifted away from simple privatisation by companies towards private investment by financial firms and income streams for pension and other funds. As Julia Ngozi Chukwuma and colleagues explain, the Word Bank has supported strategies that seek lucrative financial opportunities and prioritise high shareholder returns instead of positive social impact. Particularly with healthcare, new financial actors and approaches have been integrated into national systems.
These modalities reinforce the World Bank’s “billions to trillions” agenda, which argues that given insufficient public funds, trillions of dollars locked into pension and other private funds are necessary to achieve the SDGs (see Observer Summer 2023). Defined as the “Wall Street Consensus” by economist Daniela Gabor, this approach involves converting development goods and services into financial assets, with ODA and state finances increasingly channelled as “blended finance” to help offset investor risks and guarantee investor profits. This “development as de-risking” paradigm places the burden onto the public, particularly in the Global South. As Ana Carolina Cordilha demonstrates, one of the impacts of financialisation in the health sector is the internalisation within it of corporate and financialised behaviours, with detrimental consequences for service delivery.
The SDGs will not be achieved if we depend on commercialised goods and services.
The IFC has been a major player in the privatisation and financialisation of health, with over $9 billion invested in private healthcare since 1999. For example, it advised the Lesotho Government on structuring a contract with investors to develop a privately-operated national hospital. A 7 April 2014 Oxfam briefing note reported that the IFC earned substantial fees upon contract signing while private investors made 17 to 25 per cent annual returns on investment, far above typical global expectations.
IFC healthcare investments drive human rights abuses and escalate costs
Evaluations of IFC investments in essential services reveal significant negative consequences for individuals, governments, systems, democratic accountability and national sovereignty. For instance, the Health in Africa Initiative, established in 2008, aimed to attract $1 billion in investment. The 2012 midterm review highlighted that mainly wealthier urban populations benefitted, gender equity and transparency were neglected and intermediaries unsurprisingly prioritised financial returns over health outcomes. Research by New York University and for Feminist Africa into private healthcare had similar findings. Prioritising facilities and curative care over primary healthcare and essential services like clean water distorted service delivery.
The IFC widely promotes public-private partnerships (PPPs) to attract investment assuming the private sector is better financed and more efficient in delivering goods and services. Despite considerable evidence about the risks and damage of the model, multilateral development banks and the International Monetary Fund continue to pressure governments to create “PPP-enabling” regulatory and policy environments (see Observer Autumn 2022). The resulting corporate capture of development has propelled growing state indebtedness and declining access to quality public services. Even Global North countries, despite having the required “high administrative capacity” to manage PPPs, are not immune to these risks (see Observer Summer 2018). Private investment in the social sector is a slippery slope to replacing the public sector with the for-profit private sector. It is a failed development model.
Current dynamics: recycling a broken model
Development finance is presently being disrupted. Indebted countries allocate ever-increasing portions of scarce public finances to repay exorbitant commercial investments and loans. When providing much-needed support, international financial institutions demand austerity measures and intensifying structural changes to attract investors, which diminish fiscal and policy space urgently needed to satisfy human rights obligations to, inter-alia, water, healthcare and education, all of which are embedded in the SDGs (see Observer Winter 2023).
The freezing and restructuring of USAID’s programmes and the UK’s rerouting of development funding towards military spending herald new ODA directions, enriching investors and saddling borrowing countries with unpayable debt. Although the World Bank’s chief economist Indermit Gill declared the billions to trillions agenda “a fantasy”, Global North narratives will likely re-emphasise attracting yet-to-materialise private investment. Government costs will likely escalate through assuming more private sector risk and/or guaranteeing more profits.
The SDGs will not be achieved if we depend on commercialised goods and services. We must urgently dismantle the structural forces driving catastrophic debt burdens, centring the IFC as a key player in financing essential services, and empowering and enriching global private investors. Instead, we need to strengthen quality, universally accessible public health, education, and social services that fulfil the right to development.
In June 2022, education actors successfully pushed the IFC to stop financing private education as the World Bank froze direct and indirect investments in private for-profit pre-primary, primary and secondary schools (see Observer Summer 2022). The IFC must do the same again and honour longstanding calls to stop funding for-profit healthcare!
Sue Godt is retired after engaging in development work, development education and solidarity activism since the 1970s. She has lived in Sub-Saharan Africa for over 30 years working at community, national and regional levels on community and women’s development, knowledge management, and health and rights-based programming and also worked globally. Since completing her doctorate examining growing global corporate involvement in Kenya’s and Uganda’s basic health and education services, she has supported DAWN in their work on public-private partnerships and macroeconomics.
