What can Development Assistance Committee members do?
This paper explores the health financing challenges that countries face when they
transition from low-income towards middle-income level and beyond. While domestic
actors bear an increasing share of the national health expenditure in this process,
the transition is not automatic nor necessarily smooth. The challenges that emerge
in the process are recently exacerbated by the COVID-19 crisis, which risks diverting
resources away from basic health services. The role of development actors during this
stage can be critical in setting up sustainable systems of health financing in those
The paper starts with a review of the progress on the global health agenda by taking
stock of past achievements and remaining challenges. Then, it explores how the health
financing landscape transitions with the income level of a country, tracing how this
can give rise to transition setbacks. Finally, the paper zooms in on the role of development
finance and how it can be reshaped to better facilitate the transition process of
Throughout their journey towards sustainable development, countries face complex and evolving financing challenges. Donors thus need to constantly adapt their support to the changing financing needs of developing countries. The Transition Finance Toolkit provides them with the methodological guidance, evidence and assessment tools to implement a flexible approach to transition finance in their programmes. The content of the toolkit seeks to foster transparency and facilitate co-ordination among all development stakeholders.