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Health Sector Corruption in Ethiopia 33
Figure 2.3
Ethiopian Health System Actors and Vulnerabilities to Corruption
government
MOFED / OFAG
PPA
suppliers
pharmaceutical
companies,
contractors,
transportation
firms
B
FMOH
DACA / EHNRI /
ERPA / PFSA
RHBs/ BOFEDs
WoHOs/ WOFEDs
A
F
foreign aid
GFATM
GAVI
WB
bilateral agencies
UN agencies
vulnerabilities to corruption
(A) manipulating bureaucratic
procedures for personal
gain or political goals;
favoritism in employment
(B) fraud, kickbacks, and
bribing inspectors
(C) absenteeism, theft of
supplies, and misuse of
funds
(D) diverting patients to
private practice
(E) charging illicit fees
(F) embezzlement, fraud,
kickbacks, and theft
C
public health
facilities and
pharmacies
E
D
patients and
communities
private health
facilities and
pharmacies
E
Note: FMOH = Ministry of Health; MOFED = Federal Ministry of Finance and Economic Development; GFATM =
Global Fund to Fight AIDS, Tuberculosis and Malaria; GAVI = Global Alliance for Vaccinations and Immunisations;
RHBs = Regional Health Bureaus; WoHOs = Woreda Health Offices; PPA = Public Procurement Agency;
UN = United Nations; ERPA = Ethiopian Radiation Protection Authority; PFSA = Pharmaceutical Fund and Supply
Agency; OFAG = Office of the Federal Auditor General.
As table 2.1 showed, an estimated two-thirds of total health expenditure
is financed through foreign aid. In most developing countries, this
would mean that funding is governed by separate donor procurement and
accounting systems. Yet a significant share of all foreign aid is channeled
through the government of Ethiopia’s national procurement and financial
control mechanisms (table 2.1).
In 2006, Ethiopia directed about US$130 million of domestic revenues
to health through the FMOH, Ministry of Education, and Ministry of
Defense. Foreign agencies provided another US$475 million, of which
US$264 million was channeled through MOFED or the FMOH. The
funds channeled through the government were subject to normal federal
procurement and financial management policies, which have been
reformed with support from the World Bank and are considered acceptable
by international standards (FDRE 2007a; World Bank 2007; Wolde
2009). Even in cases where foreign agencies use funds to procure
pharmaceuticals and commodities, the government is trying to ensure