# United States aid cut: alternatives for sustainable financing for health

## TL;DR

This paper discusses how recent US aid cuts are harming health programs in low- and middle-income countries and proposes sustainable financing solutions like debt-to-health swaps.

## Contribution

The paper introduces the Debt-to-Health Swap as a novel sustainable financing mechanism to address health funding gaps in low- and middle-income countries.

## Key findings

- The US aid cuts have led to the closure of 200 health facilities in Afghanistan, affecting 1.84 million people.
- Spain's Debt-to-Health Swap agreements with Cameroon, Ethiopia, and the DRC have successfully improved health programs for HIV, TB, and malaria.
- High debt servicing costs in LMICs, exceeding 3% of GDP by 2024, persist as a challenge for sustainable health financing.

## Abstract

Recent United States (US) foreign aid cuts, notably through Executive Order 14169 signed on January 20, 2025, have disrupted health programs in low- and middle-income countries (LMICs), threatening progress in combating HIV/AIDS, tuberculosis, and malaria. With 37 LMICs relying on US aid for over 10% of their health budgets, the funding pause has led to closures of critical health facilities, such as 200 in Afghanistan, impacting 1.84 million people. This commentary explores sustainable financing solutions, emphasizing the Debt-to-Health Swap (D2H), where debt is forgiven in exchange for health investments. Successful D2H examples include Spain´s agreements with Cameroon, Ethiopia, and the Democratic Republic of Congo, which bolstered HIV, TB, and malaria programs. Additional mechanisms like climate financing, through initiatives like the Green Climate Fund, and health taxes are proposed, though challenges like high debt servicing costs, exceeding 3% of GDP in LMICs by 2024-persist. The commentary urges LMICs and regional bodies, such as the African Union, to advocate for D2H in global forums, integrating it into debt relief discussions to enhance health system resilience. By fostering collaboration between creditors, health organizations, and governments, D2H can unlock resources for infectious diseases, maternal health, and climate-related health risks, ensuring sustainable development.