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Swiss sustainable finance helps amputees in the DRC walk again
This article was first published in Le Matin Dimanche on 15 December 2019.
Three new orthopaedic hospitals are taking shape in the Democratic Republic of Congo, Mali and Nigeria thanks to funding from a private debt transaction. Some of Lombard Odier's clients have invested in these projects, which are sponsored by the bank and the ICRC.
The construction site is in full swing. At the heart of the building, a long concrete ramp awaits a few finishing touches: a three-loop, 80-metre- ramp, dotted with rest stops, climbs gently between the two floors of the new orthopaedic centre in Kinshasa, built by the International Committee of the Red Cross (ICRC) with the assistance of a humanitarian loan supported by Genevan bankers.
Responsible finance is often an abstract concept, the results of which are hard for the public to see. Think oil is too dirty to invest in? The same for arms? These are often part and parcel of the investments offered to banking clients. Investment and ethics do not always seem to go hand in hand.
But there is a real awareness in the financial world, and new types of humanitarian partnerships are emerging. New hospitals are being built thanks to support from clients with savings in Swiss banks. The concept is totally new: philanthropy meets investment.
What difference can a USD 26 million loan make in countries in the throes of violent conflict? Time will tell. The ICRC and Lombard Odier have "co-sponsored a private debt transaction" to build and run three physical rehabilitation centres in Mali, Nigeria and the Democratic Republic of Congo (DRC). This five-year arrangement, called the ICRC Programme for Humanitarian Impact Investment (PHII), also includes a training component. Several European governments are also involved. The three orthopaedic centres are now under construction, and local staff are receiving ortho-prosthetics training.
A humanitarian loan
This private debt transaction is complex. Private investors advance the money and are repaid at maturity by Western governments based on the results achieved. "We have established a performance contract," says Maximilian Martin, Head of Philanthropy at Lombard Odier. The underwriters – the Belgian, Italian, Swiss and British governments, as well as the La Caixa Foundation – will only make payments to investors if certain criteria are met.”
Investors take a risk, but could also reap rewards. "They could lose up to 40% of their investment if the final project fails to meet pre-determined quality criteria," he explains. However, if the new centres are 80% more efficient than the existing reference centres, they could receive a total return of 34% over five years." In other words, government funders are galvanising humanitarian performance.
Let's go back to Kinshasa, the orthopaedic centre under construction. "Safety barriers still need to be installed," says Thierry Vignolles, the organisation's project manager. Everything is scheduled to be completed by spring 2020.
The sound of sanders is deafening. Nearly 80 helmeted workers, bricklayers, painters and electricians, are toiling away together. The centre will cover an area of 2,500 m2 and offer services ranging from workshops for manufacturing prosthetic devices to an exercise circuit. A back-up generator is planned to provide electricity during the DRC capital's frequent power cuts. On the ground floor, workers in red and yellow hard hats are sorting gravel of various sizes and colours into three piles on the exact spot where prostheses will soon be produced.
The first floor, where electric cables are still hanging from their shafts, will house several cubicles, in which some fifteen physiotherapists will work in close proximity to the exercise room. Once the work is completed, this exercise room will be fitted with parallel bars, rehabilitation stairs, replicas of urban obstacles and pavements to allow disabled patients to learn to use a new leg or wheelchair.
"The goal is to provide rehabilitation care to 2,200 people a year by 2022," says Marc Liandier, head of the ICRC's Physical Rehabilitation Programme (PRP). Several ortho-prosthesists are already being trained up to boost the teams.
Investors will be paying close attention to their progress, since the final return on their investment depends on it. To be able to objectively assess the results obtained in 2022, a set of indicators has been compiled in the form of a benchmark index. "This benchmark takes into account the number of patients treated, wheelchairs distributed and prostheses provided to those most in need, among other factors," Maximilian Martin explains. A digital component is also planned, with an IT-based resource management tool under development. "The planning of resources and supplier relations will be improved, and electronic patient records will be created." All of this will be taken into account before the final payout.
The lack of funding is glaring
The ICRC does not intend to run the centre forever. Next year, the building will be handed over to Kinshasa General Hospital, which will then be responsible for it. This will present some challenges. The budget will not be easy to meet due to the lack of healthcare funding in the country. "We are in the middle of discussions on how the ICRC will support us in the future," confirms Clément Mbaki, director of the General Hospital. Despite the immense richness of the Congolese subsoil, Kinshasa's pockets are empty.
But the need for healthcare in the DRC is enormous. It is the second largest country in Africa and has been hit by repeated armed conflicts since the mid-1990s. Roads are often destroyed, and crime is a concern. Gunshot wounds are common in the east of the country, and the care available is inadequate.
The construction of the new orthopaedic centre is timely. "It will be the first flagship facility in this field," explains Martin Kembo, coordinator of the physiotherapy and prosthetic devices department (SKAO) at Kinshasa General Hospital, who will take over the new centre. In Kinshasa, road accidents and polio after-effects are also fuelling the need for orthopaedic care. Free care is currently only available from a handful of religious groups and private organisations. The ICRC has been providing aid since 1998.
Important information
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