Photo Credit: alisonbird/Flickr.

A key criticism of foreign aid is that donor programs tend to import the commodities needed to support programs, rather than purchasing them locally, which can effectively kill local production industries. This criticism is invoked frequently in the case of food aid and more recently this criticism has been invoked in the case of bed nets for malaria. Most of the nets that have been purchased with donor funds from major global health initiatives have been sourced from producers located outside of the destination country, leaving little opportunity for the development of a local industry to produce these nets. This argument has been discounted by many in the health community that have argued that the lifesaving effects of these nets far outweighs the need to develop a local bed net industry and that health concerns far outweigh economic considerations.

But local production is just part of the story, and I have witnessed another side effects of these strategies, one which could have a more direct effect on health. In addition to production, the effective delivery of bed nets also requires these nets to be imported, distributed, and sold locally. In Ethiopia, prior to massive free bed net distribution programs, there was a local private bed net distribution system. Local businessmen took it upon themselves to import nets into the country and distribute them to retail shops across the country. I’ve seen survey data that suggests that upwards of a quarter of households in some areas purchased bed nets through these private retail distribution channels.

You can probably guess where this is going: Ethiopia won a big project malaria grant and millions of nets were important and distributed free of charge throughout the country, in particular in the areas with high disease burden. The program was perhaps the single largest bed net distribution program ever undertaken anywhere in the world and from what I can tell the nets really did get to those who needed them (what impact they have had on clinical outcomes, is another story which I will leave aside). But, according to people I interviewed, the private distribution channels that existed before this distribution programs suffered major set backs. No one needed to buy a net anymore, so no one did. Importers stopped importing nets, distributors stopped distributing nets, and retailers stopped selling nets. Selling bed nets was no longer good business.

While many more people got a net that perhaps would have ever purchased them in the first place, the problem arises when one considers what will happen over time. Communities were targeted through this grant once and for now there are no plans to return to these communities. In the interim, should a household want to purchase a net, it is now more difficult to do so. The free nets may become less effective over time but it is hard for households to buy replacement nets. The distribution channels that took years to establish have been killed and may never return, in particular if business believes that there is a risk that the public distribution programs will be repeated.

While I don’t think this is necessarily an argument against large scale distribution programs, because I do believe that such programs can achieve higher bed net coverage than leaving it to the free market, I do think it points to how a public-private solution may have avoided some of these problems. Had the donor funds been used to purchase some of the nets from local distributors, using local channels, than the networks might have been saved – even rewarded for their efforts. Saving lives is the priority – no doubt – but sometimes it does not have to be either or – corporate interests are not inconsistent with health interests.

P.S. Since posting this post, Bill Brieger posted a follow-up comment on his website. I thought it was a good follow-up read, so I am linking to it here.

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8 Responses to “A side-effect of free bed nets programs”

  1. Sheila says:

    I agree with you. Donors don't take into account The Disincentive Factor to local innovation when they come and kill off nascent industries and entrepreneurs. I like to believe that it's just an unintended consequence of their goodwill and good intent. But its time that this becomes allied to the power of systems thinking and transformational leadership. Thankfully, there are more and more of us are prepared to watch the Donors as well as the Recipients of Development or Relief Aid, otherwise, Africa will never get off its knees.

  2. Bill Brieger says:

    The long term effect of the free net program is extremely important as you point out. This is the essence of the catch-up and keep-up aspects of net programs. The campaigns for free nets do the catch-up to increase coverage (assuming there is proper health education so that people actually use the nets). What people forget and have not adequately planned is the keep-up. On the day after the campaign there will be new people in need who did not receive a net – newly pregnant women, migrants into an area, etc. Even if 'universal coverage' of every household is achieved in during catch-up, this often devolves to 2 nets per household in locations where the average number of peple in a house are between 5 and 6. Also what if Global Fund Round X support runs out, and the country does not win Round Y? Where are nets coming from? In theory governments could buy nets from the private producers if these were still in business and distribute free, but if the local business has died, what alternatives are there for keep-up? Africa at least has a vibrant textile industry. How can this resource continue to contribute to the fight against malaria?

  3. Erick says:

    Good points, Karen. A lot of development projects in Africa don't give a sense of ownership to the locals, so are unsustainable.

  4. Gurjeet says:

    I recall reading an article about one aid agency that used the local labourforce to produce these nets. Can't remember which country or organization though.

  5. Yael says:

    Hi Karen,
    I'm new here, so first off, hello. Second, why exactly do you think no one considered locally sourcing the nets? It seems intuitive to me that locally producing the nets would not have only been more sustainable, but also more cost-effective (considering shipping costs). Why do you think locally sourcing some of the nets wasn't considered?

    Yael

  6. Karen Grepin says:

    Thanks for all of the great comments! Bill, big thanks for your additional comments. I have now posted a link to your response at the bottom of the post.

    Yael, I think the question of local production is also an important point. I do think it is sometimes considered, but in this particular case the order was so far beyond the production capacity that would have been able to be scaled up, that it would have been unrealistic to try to source all of these locally.

    Local production frequently gets discussed, my point here to was to try to think beyond just local production and that other players are also important.

  7. Jonathan Eyler-Werve says:

    Solution: outsource supply chain of your nets to the local marketplace. If you send donors into small villages and buy out 50% of the local supply at lowest available prices with cash (repeat, repeat, repeat) then distribute them. Those businesses will expand, compete, flourish.

    Cheapest solution? No. Best? Maybe.

  8. tiantian says:

    I think one problem that is not mentioned is how price-sensitive it is when it comes to the market for bed nets in some of these countries/regions concerned. Even if we could outsource the local supply chains, it does not fully solve the problem of low sustainability. When the day comes when donors decided to cut funding in the outsource program and the bed nets are suddenly subjected to a price when they use to be free, there is likely to be a sharp drop in demand as well as unemployment issues for those working in the local bed net industry. The more critical issue is if there is any way at all to increase the willingness of the local people to buy nets. Both demand and supply need to be addressed. J-Pal just had a new paper on this issue which I think is pretty neat.

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