The Effect of Foreign Aid on Health Outcomes in Nigeria: A Case Study of Lagos State Teaching Hospital

The Effect of Foreign Aid on Health Outcomes in Nigeria: A Case Study of Lagos State Teaching Hospital

Ngozi Chima-Uzosike

Methodist University Ghana

DOI: https://dx.doi.org/10.47772/IJRISS.2024.802035

Received: 16 January 2024; Revised: 23 January 2024; Accepted: 29 January 2024; Published: 02 March 2024

ABSTRACT

The paper examined the effect of foreign aid on health outcomes in the Lagos State Teaching Hospital in Nigeria. The purpose of the study was to uncover the actual effect of foreign aid inflows on health outcomes in Nigeria. The paper employed a quantitative research methodology which explored secondary resources from WHO publications, journals and thesis on foreign aids and their contribution to health outcomes in developing countries especially Nigeria, and other official reports, and statistical bulletins. Qualitative methodology was also applied in this research. A semi-structured questionnaire was administered within the Lagos State Teaching Hospital, with a sample population of 50 healthcare personnel. The qualitative methodology was adopted to give a holistic view of the research study based on the concepts of the literature review, and to fully understand the situation of the topic under study in the country. One of the situation which the paper found out, is that Nigeria have received substantial amount of foreign aid and yet these amount of foreign aid is still considered to be low given the huge healthcare issues in Nigeria. The paper also revealed that, the foreign aid received through the Government in the country have been largely ineffective in addressing the health issues of Nigeria. This could be as a result of the lack of balance between the health challenges in Nigeria and the rate at which these aids are used to fund it. Lack of appropriate policies on disbursement rate of foreign aids to various health cases such as tuberculosis, malaria, HIV/AIDS, and others, could be the case for the perception of how low foreign aids are to the issues of healthcare. This is, without the articulation of the corruption laced on handling of foreign aids in Nigeria. The paper finally revealed foreign aid has a positive impact on the Nigeria health outcomes especially in the area of maternal health, but grossly ineffective in other areas. The study recommended that, the Nigeria government should ensure that foreign aid meant for the health sector is not diverted to other sectors and that; foreign aid dedicated to the health sector should be used judiciously

Keywords: Foreign aid; Health outcomes.

INTRODUCTION

In recent decades, there had been an increasing campaign for developed countries to transfer financial resources in the form of foreign aid to developing countries to help in the fight against diseases found in developing countries. Most wealthy nations responded to this call by increasing the aid earmarked for the health sector in developing countries. There has been a shift in the goals of foreign aid in terms of its quantities and how it is spent. Unlike in the early 1980’s and 1990’s where foreign aid focused on structural adjustment and conditionality respectively, the focus of the donor support shifted from the former to the health and educational sectors. As a result, foreign aid has become a major source of funding for the health sector in developing countries. Many governments of wealthy nations who committed huge sums of resources to the health sector began to raise questions about the effectiveness of how the resources were spent and the impact it has had in the health sector of developing countries. The new focus of foreign aid is to enhance human capital developments through investments in the health and educational sector. Despite this new focus, many developing countries went off-track with their progress towards their health related target in the Millennium Development Goals. Despite the huge financial injections by wealthy nations, there is still low access to essential medicines in most part of the developing world.

Since independence, Nigeria has received substantial foreign aid targeted at the health sector, with the goal of improving health outcomes and living condition of the country. However, despite this heavy transfer of foreign aid to Nigeria, the country’s health sector is still limping as the health outcomes have not improved significantly. Many have questioned the impact of such huge inflows on the health sector as no meaningful impact has been observed, hence the need to examine the actual impact of foreign aid on the health sector of Nigeria.

Secondly, despite the fact that, several studies have been done on foreign aid, majority of such studies focused on foreign aid and its impact on economic growth without focusing on specific sectors like the health sector, hence the need to fill this research gap. It is on this basis that this study intended to examine the impact of foreign aid on the health sector of Nigeria using Lagos State Teaching Hospital as a case study.

Aims and Research Questions

This study aimed at examining the impact of foreign aid on improving the health outcomes of Nigerians using the Lagos State Teaching Hospital as a case study. To reach this objective, the study focused on the following research questions:

1. To what extent is the level of foreign aid to Nigeria, effective in improving health outcomes?
2. What is the rate of foreign aids inflow in the country, and how balanced has it been in solving issues of Polio, Malaria, Tuberculosis, and other basic health issues suffered in Nigeria, using Lagos State Teaching Hospital as a sample study?
3. What is the measurable percentage of foreign aids to health outcomes in Nigeria?

LITERATURE REVIEW

Foreign Aid

Foreign aid can be defined as” the transfer of concessional resources, usually from a government or non- governmental organization in a recipient country. This may be provided for a variety of reasons such as commercial and developmental” (Tseng, 2020). Foreign aid therefore relates to the different types of aid offered by wealthy countries to under developed countries in addressing human suffering, improve human welfare, and reduce poverty and development (Swain, Supriya Garikipati, Wallentin, 2020). In most instances, foreign aid comes with some conditionality attached to it (Swain, Supriya Garikipati, Wallentin, 2020). There different types of foreign aid, however, for the purposes of this study, foreign aid can be grouped under two type’s namely multilateral and bilateral aid.

Bilateral aid comes from a donor country who transfer resources or assets to a recipient country whiles a multi-lateral aid comes from several donor countries. In 2007, the G8 countries for instance promised to increase multi-lateral aid by $ 50 billion by 2010 with 50% of the aid going to Africa (Baliamoune-Lutz, 2016).

Effects of Aid on Health Outcomes

There is mounting debate as to the impact of foreign aid to the improvement of the health sector. Critics of foreign aid including To seef, Jensen and Tarraf (2020) have argued that, foreign aid is “dead” because despite the fact that several billions of dollars have been transferred to developing countries to improve the health condition in the society, the result has been disastrous as the foreign aid has rather worsens people health conditions and poverty levels.

After the Paris declaration in 2005 and 2008 respectively on aid effectiveness, partner countries and development agencies committed to ensure that, recipient countries own and account for the use of the foreign aid.  This has resulted in the restructuring of aid to better serve its goals, especially when addressing health issues such as HIV/AIDS and maternal and child health (Toseef, Jensen and Tarraf, 2020). Nevertheless, in 2010 maternal and child health was able to receive a high level of commitment from G8 countries. The initiative had a commitment of US $ 7.3 billion to improve maternal and child health in poor countries. Core principles have been established to bring about improvements in understanding, measuring and tracking the progress of maternal and child health reduction.

Some of the measures been implemented include cost-effective interventions focused on countries with high maternal and child health rates, strengthening community-based health policies and health-related plans, accountability, and monitoring and evaluation of health programs (Bitzer & Gören, 2018). Maternal and child health received a lot of attention because most women in developing countries were the main household contributors. Therefore, healthy women ensure that they work and take care of their children. US $ 2.7 billion was allocated to maternal and child health in 2003 and US $ 6.5 billion in 2007 (Bitzer & Gören, 2018).

The prevalence of maternal and child health is high worldwide, especially in developing countries. In 2008, an estimated 342,900 maternal mortality ratios occurred during pregnancy, during childbirth, and after childbirth (WHO, 2019). Families of these women are often devastated after their death, leaving children to protect themselves for themselves (WHO, 2021). The donor community needed to intervene in maternal and child health reduction globally as poorest countries could not properly invest in their health care systems.

When accessing the role of aid in addressing the challenges of maternal and child health, it is important to look for evidence of the effectiveness of aid for maternal and child health.

Therefore, this report will investigate the impact of foreign aid on the health sector with a special emphasis on maternal and child health in developing countries, which happens consistent with the MDG4. In developing countries, especially Africa, there were concerns that health-related Millennium Development Goals may not be met. The MDG 4 aims to reduce child mortality by 85% and maternal mortality by 75% by 2015. In the face of government constraints, it was very important to have sufficient resources to reduce maternal and child health (Bein, Unlucan, Olowu & Kalifa, 2017). This has led donors to increase their pledge to increase funding for maternal and child health mortality in poor countries.

Other organizations, such as the WHO, the United Nations and the World Bank, have adopted global health funds to transfer resources to governments and NGOs in developing countries to improve the quality of their health programs. Therefore, it was necessary to monitor the fund to ensure that it was being used wisely. Health resource tracking have been used to identify gaps between the funds spent, the funds needed, and the funds available to mobilize more resources (Rahman, Khanam & Rahman, 2018). Powell’s Johnson and Mills agree that interventions to achieve the maternal and child health MDGs require sufficient funding.

The resources required for this intervention are estimated to be approximately US $ 40-70 billion annually (WHO, 2021). Global health funding has been boosted recently, with some donors actively participating in funding and promotion aimed at directly improving health outcomes. Global funding from the private and public sector increased from $ 5.6 billion in 1990 to $ 21.8 billion in 2007 (WHO, 2021) and $ 37.6 billion in 2016 (Financing Global Health Report, 2016). Toseef, Jensen & Tarraf, (2020) called for a global system of health care finances. He argues that a comprehensive mechanism for achieving unity must be introduced for a unified management of global health finance that guarantees the basic needs of the poor. Still, the reaction to the effectiveness of foreign aid is mixed. Some scholars agree that development assistance has a positive impact.

Rahman, Khanam and Rahman, (2018) argue that foreign aid has a positive effect on solving development problems, especially in developing countries. In contrast, Bitzer and) Gören, (2018) argue that foreign aid is having a negative impact on developing countries. Given the complex relationship between development and health, it is interesting to find out how investing in health programs can contribute to the economic development of developing countries. It has been argued that productivity must be healthy in order to achieve high economic productivity (Bein, Unlucan, Olowu & Kalifa, 2017). While this study provides an important step in gaining empirical evidence of the role of aid in development outcomes, few studies have examined the effectiveness of aid in health issues such as maternal and child health (Adhikar, Smith Sharma, and Chand, 2018). According to a survey conducted from 2003 to 2006, the flow of maternal medical assistance has not reached the affected countries (Adhikar, Smith Sharma & Chand, 2018).

According to a survey conducted from 2003 to 2006, the flow of maternal medical assistance has not reached the affected countries (WHO, 2021). According to Bein, Unlucan, Olowu and Kalifa, (2017), development assistance “follows success, not causes success.” Other studies have pointed out the negative effects of aid on health outcomes, especially in countries with increased maternal and child health, especially debt (Eger, Öhler & Rudolph, 2018). The rise inmaternal and child healthlevels is associated with high debt associated with aid (Eger, Öhler & Rudolph, 2018).

Previous studies on the impact of foreign aid on mortality have focused on child mortality (Bedir, 2016). However, empirical evidence from previous studies shows that the effect of aid on infant mortality was not definitive. Some studies find no evidence of improvement in health indicators such as infant mortality using some sector data (Bedir, 2016), while others worsen the health sector.

According to Barkat, Mrabet and Alsamara, (2016) foreign aid has no effect on improving public health.  Kind, (2018) found that foreign aid did not affect infant mortality. Nevertheless, a relatively positive relationship was found between maternal and child health and ODA (Rahman, Khanam & Rahman, 2018). Given the worldwide attention to maternal and child health, the empirical evidence in recent studies linking foreign aid to mortality is surprisingly sparse. Another aspect of foreign aid effects focuses on the consequences of non-growth. Proponents of this approach argue that focusing on the impact of aid on growth can overlook important benefits of aid outcomes such as health (Bedir, 2016). For example, Lynda, and Leonce, (2018) argue that if medical services are provided by international organizations such as NGOs, government spending on medical services will increase.

Omotola (2018) observe that aid helps to mitigate conflict risks in countries with low-income earnings during an economic recession. Therefore, the relationship between aid that is meant for health programs and the system of governments may differ from the relationship between system of government and foreign aid in general. Aid meant for health programs needs will be ineffective in countries that are corrupt, as the approval for health, programs are always quick and countries may not comply (Toseef, Jensen & Tarraf, 2020). Some literature has shown that there is either a significant, little or no effect of public health spending on health outcomes such as maternal, infant and under five mortalities.

Baliamoune-Lutz (2016) found that government health care costs less than one-seventh of the 1% variation in under-five mortality. They concluded that 95% of changes in under-five mortality rates are determined by factors such as national per capita income, women’s education level, and regional choices. By comparison, Lynda, and Leonce, (2018) found no significant association between health care costs and changes in the health effects of infant mortality in low-income countries.

Rahman, Khanam and Rahman, (2018) used a pooled generalized least-squares estimation procedure to examine the relationship between health indicators and total public and private spending on per capita health. Population health indicators have receded in some variables, including per capita public health spending, but manipulation variable estimates have been used to control possible concurrency between health status and public health spending. They found a statistical relationship between health status and per capita income.

Hayes (2017) used the ROLS (Robust Ordinary Least Squares) estimation method in investigating the relationship between medical costs and medical outcomes in Africa. Their results show that medical costs are statistically significant and the relationship between them is reversed. If all other conditions are the same, an increase in health care costs will lead to a corresponding decrease in health outcome. A study of 80 low- and middle-income countries by Bein, Unlucan, Olowu and Kalifa (2017) found that increased government spending on health had a greater impact on reducing maternal and child health education and infrastructure development. Lynda and Leonce, (2018) provided a good basis for discussing the role of aid in minimizing child and maternal mortality, and these authors authored several factors related to the research issue. According the authors, a common factor leading to increased mortality, especially in developing countries, is lack of access to medical facilities due to poor infrastructure.

According to statistics, about 20% of babies in vulnerable areas die each year if they do not receive the necessary care in a timely manner. Based on (The National Universities Commissions Report, 2021) on Lagos State University Teaching Hospital, health outcomes using variables such as mental illness, tuberculosis, malaria, and others, showed numerous deaths linking to lack of quality service delivery in these areas as a result of improper diagnosis, therapeutics, and even patient information handling (Ayilegbe, 2020). Other reports from studies about the case hospital showed that whatever the level of foreign aids the State Government receives, and disburses to the hospital management, it has not been effective in curbing cases of medication problems, clinical services, and others, leaving the hospital in a constant need of funding to improve its service delivery to patients (Wissmann, 2015)

METHODS

Design and Participants

This study employed quantitative and qualitative method in answering the research questions of the study. The study employed a case study research design. The population of this study is an approximate number of 500 employees, which included hospital management staff, clinicians, dieticians, medical lab scientists, nurses, and other staff of the Lagos State Teaching Hospital in Nigeria. Based on the aim to eliminate ambiguity in reporting, the study sampled fifty (50) respondents from the Lagos State Teaching Hospital. These participants, were selected using the simple random sampling technique.

Data Collection

Data was firstly collected from secondary data sources such as WHO publications, academic journals and thesis on foreign aids and their contribution to the health outcomes in developing countries using Nigeria as a case study. Other secondary resources were the Nigerian Universities commissions reports, Ministry of Health bulletins, and others. Primary data was collected using semi-structured questionnaires based on the objectives of the study. The author personally visited the Lagos State Teaching Hospital and administered the questionnaires. The author used three weeks in distributing and collection of the research data.

Data Analysis

The research data was analysed using descriptive statistics mainly frequencies, percentages, and the results were presented in Tables.

RESULTS

The level of foreign aids in Nigeria

On the level of foreign aid to Nigeria, the findings indicates that, all the respondents strongly agreed that, Nigeria have been receiving foreign aid for decades now. The entire respondents agreed that, the level of foreign aids received by Nigeria is relative high based on Government’s reports.

Table 1: Do you agree that, your country receive foreign aid?

On where the foreign aid comes from, the findings show that, most of the foreign aid received by Nigeria comes from multi-national institutions like the World Bank and the IMF as 74% of the respondents agreed to this assertion. The result also show that, 26% of the respondents believe that, most of the foreign aid received by Nigeria comes from bilateral organizations like individual donor countries.

Table 2: Where do the foreign aid mostly come from?

The findings show that, largely, Nigeria receives significant amount of foreign aid from multilateral sources, but the disbursement to the hospital administration might be stifled. This percentage result presentation is used to contrast the government reported aid to the level the hospital is awarded the aid.

Table 3 What is the degree to which your hospital receives foreign aid?

On the question of whether respondents think their country deserves more or less foreign aid, the respondents agreed that, their country deserves more foreign aid. 74% of the respondents agreed that Nigeria need more foreign aid to support hospital operations, through the purchase of advanced medical infrastructures, medications, and other services necessary to increase health outcomes of patients, and the primary health care centres.

Table 4. Do you think your country deserves more or less foreign aid?

The effectiveness of foreign aid in addressing the health challenges in Nigeria

On the percentage of foreign aid, that goes to the health sector, majority of the respondents said, of the total number of foreign aid received by hospitals, primary health centres, and clinics could be about 20-30%. In all, approximately 72% of the respondents agreed that only about 20-30% of foreign aid received by Nigeria Government is disbursed to the health sector.

Table 5 What percentage of foreign aid goes to the health sector?

On whether the foreign aid received by Nigeria is enough or not, the respondents asserted that, the foreign aid Nigeria receive, as a country is not enough. This is illustrated by the fact that, approximately 76% of the respondents said the amount foreign received by Nigeria is not enough considering the economic challenges facing Nigeria.

Table 6: Would you say the amount of foreign aid dedicated to the health sector is enough?

The effectiveness of the foreign aid received in Nigeria is considered as not effective as majority respondents representing 52% said the use of the foreign aid received by Nigeria is not effective.

Table 7: How would you describe the effectiveness of foreign aid dedicated to the health sector of your country

The relationship between foreign aid and health outcomes  

On whether there is a relationship between foreign aid and outcomes, majority of the respondents representing 66% agreed that, there exist a relationship between foreign aid and health outcomes. The case in hand (Lagos State Teaching Hospital Report, 2021) showed numerous deaths linked to lack of equipment for clinical services, therapeutics, and medication. The lack of these equipment is due to lack of funding this State hospital and other State hospitals across the country. Deaths relating to health issues such as Malaria, Cholera, maternal deaths, that can be avoided becomes an impediment that leads to death.

Table 8: Do you think foreign aid has anything to do with health outcomes?

On the extent to which foreign has influenced health outcomes, the result shows that to a large extent, foreign aid has not effectively affected positive health outcomes in Nigeria. 74% of the respondents believe that the inflows of foreign aid to Nigeria has not significantly influenced the health outcomes in then hospital, which is a benchmark for the country. To some, 12% of the population sample believes the foreign aids have afforded certain basic health kits to treat a fraction of patients in the hospital, while local budgets supplements for the rest of hospital activities.

Table 9: To what extent do you think foreign aid has influenced health outcomes?

On the specific area of health that foreign aid has influenced, the results demonstrates that, the foreign aid received by Nigeria has mostly influenced maternal health. The result suggests that, 70% of the respondents said most of the foreign aid sent to the health sector have influenced maternal health as most of the aid has been used to address issues in maternal mortality.

Table 10 In your opinion, what health outcomes has foreign aid has been able to achieve

On the overall relationship between foreign aid and health outcomes, the results indicates that, the influx of foreign aid to Nigeria has been positive in addressing health challenges. The result show that, majority of the respondents representing 58% agreed that, the inflow of foreign aid to Nigeria has been very positive to the health sector.

Table 11 The relationship between foreign aid and health outcomes in your country

DISCUSSION

This study aimed at examining the impact of foreign aid on the health sector at Lagos State Teaching Hospital. On the level of foreign aid to Nigeria, the study demonstrated indicates Nigeria have been receiving foreign aid for decades now and most of the foreign aid they received comes from multi-national institutions like the World Bank and the IMF and in addition, most of the foreign aid received by Nigeria comes from bilateral organizations like individual donor countries. The study also demonstrated that, largely, Nigeria receives significant amount of foreign aid from multilateral sources. This finding is consistent with Baliamoune-Lutz (2016) who indicated that, in 2007, the G8 countries promised to increase multi-lateral aid by $ 50 billion by 2010 with 50% of the aid going to Africa. The findings also demonstrated that, despite the huge foreign aid received by Nigeria, the country still deserves more foreign aid.

On the effectiveness of foreign aid in addressing the health challenges of Nigeria, the study made a number of revelations. Firstly, the findings demonstrated that, of the total amount of foreign aid received by Nigeria, only 20-30% is dedicated to the health sector. The findings also show that, the foreign aid Nigeria receive, as a country is not enough considering the economic challenges facing Nigeria. This finding is not consistent with Baliamoune-Lutz (2016) who indicated that, in 2007, the G8 countries promised to increase multi-lateral aid by $ 50 billion by 2010 with 50% of the aid going to Africa. The findings also suggested that, the effectiveness of the foreign aid received in Nigeria is considered as not effective. This finding is inconsistent with Toseef, Jensen and Tarraf (2020) who argued that, foreign aid is “dead” because despite the fact that several billions of dollars have been transferred to developing countries to improve the health condition in the society, the result has been disastrous as the foreign aid has rather worsens people health conditions and poverty levels.

On the relationship between foreign aid and health outcomes in Nigeria, the study revealed that, there exist a relationship between foreign aid and health outcomes. This finding is consistent with Rahman, Khanam and Rahman, (2018) who argued that foreign aid has a positive effect on solving development problems, especially in developing countries. The findings also points to the fact that, this is largely not experienced in Nigeria.

Largely, foreign aid has affected health outcomes in Nigeria. Kalifa (2017) found that increased government spending on health had a greater impact on reducing maternal and child health education and infrastructure development supports this finding. The findings further demonstrated that, the foreign aid received by Nigeria has mostly influenced maternal health. This finding is contrasted with Bedir (2016) who found that foreign aid has a significant impact on child mortality.

On the overall relationship between foreign aid and health outcomes, the study demonstrated that, the influx of foreign aid to Nigeria has been positive in addressing health challenges. Rahman, Khanam & Rahman (2018) found a relatively positive relationship between maternal and child health and ODA (Rahman, Khanam & Rahman, 2018).

Context and Suitability

The results of the present study a very complex situation when it comes to the foreign aid received by Nigeria and how it has affected in the health sector of the country. For instance, while Nigeria receives substantial amounts of foreign, aid, it is still not considered enough considering the economic challenges of the country. Again, despite the huge amounts of foreign aid received by Nigeria, only 20-30% is allocated for the health sector. Not withstanding, this percentage, the foreign aid received by Nigeria appears to have made some positive affect the health sector especially improvements in maternal health.

Limitations of the Study

The author faced a number of challenges in the course of the study especially during the distribution and collection of the questionnaires. Firstly, the tight schedules of the employees of the Lagos State teaching hospital made it difficult in reaching participants to deliver and collect questionnaires. The researcher therefore visited the hospital several times and waited for several hours to distribute and collect a questionnaire.

CONCLUSION

Based on the results, the study concludes that, Nigeria have received substantial amount of foreign aid and yet these amount of foreign aid is still considered to be low given the huge healthcare issues in Nigeria. The paper also concludes that, the foreign aid received by Nigeria have been largely ineffective in addressing the health issues Nigeria. The study finally concludes that, largely, foreign aid has had a positive impact on the health outcomes in Nigeria. The study recommends that, future studies should expand the scope of the research by focusing on the effect of foreign on the entire West African Sub-region.

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