Kenya, US seal Sh325b health deal as G2G funding model takes effect

US and Kenya sign a government-to-government health grant agreement. [Courtesy]

The US-Kenya health partnership deal will now move to implementation after the two governments officially signed the cooperation framework, aimed at supporting Kenya's attainment of Universal Health Coverage (UHC).

The five-year cooperation framework, valued at $2.5 billion (Sh325 billion), was signed by Health Cabinet Secretary Aden Duale and National Treasury and Economic Planning Cabinet Secretary John Mbadi, alongside the US delegation led by Chargé d'Affaires Susan Burns.

Under the government-to-government arrangement, the United States will provide $1.6 billion (Sh206 billion), while Kenya will contribute $850 million (Sh109 billion) through a co-financing model.

Speaking after the signing of the deal, Duale welcomed the formal commencement of the partnership's implementation.

He said Kenya was the first country in Africa and globally to sign such an agreement with the US government.

"I am happy because we have ticked all the boxes. We were the first country globally to sign the agreement under the leadership of President William Ruto. The agreement was signed by Prime Cabinet Secretary Musalia Mudavadi together with US Secretary of State Marco Rubio," said Duale.

“With this signature, the implementation process has begun,” added the CS.

Duale said signing of the agreement will strengthen Kenya’s key health institutions, including Kenya Medical Supplies Authority (KEMSA), the National Public Health Institute, Digitalisation, Digital Health Agency (DHA), and programs targeting HIV, tuberculosis and malaria.

The USD 1.6 billion will be invested for the next five years.

The CS noted that the agreement introduces a government-to-government (G2G) funding model, a previous funding model where US support was largely channelled to the government through implementing partners.

The Ministry of Health shall be the implementing ministry.

Previously, funding from the US was channelled through partner implementing agencies.

“We really thank President Donald Trump for this complete shift. This is because G2G gives the National Treasury and the Ministry of Health full visibility over funds, ensuring accountability through government systems and parliament oversight,” he said.

“We thank our partners; this is something we longed to have with the US Government to support our funding. With this money, coming from the US Government, we must be accountable for the money,” added Duale.

On her part, US Chargé d'Affaires Ms Burns described the agreement as the first health financing framework between Kenya and the US, a model she said reflects the two countries’ shared commitment to improving health outcomes.

“We are getting into a new funding model. The agreement signed shows what we want to do together. We recognise that we have similar goals; that is why we are trying to transition to a new model funding system, and it is really about sharing responsibility and close collaboration,” said Burns.

The US official added that the two states have long-standing partnerships on health, a collaboration that shall continue with the new funding model.

“The objective of the agreement we just signed is agreement is win win between the two governments”, she added, noting that the deal shall be built on previous build systems.

She maintained that the U.S. and the Kenyan government want to build strong health systems through the G2G funding model.

“Together, we have worked to minimise HIV; we have worked together on tuberculosis and malaria. It is now time for a new model, where we are working together and supporting the government of Kenya in terms of the health sector,” said Burns.

CS Mbadi added that the Kenyan Government longed to have the deal signed to support health funding.

“We thank our partners; this is something we longed to have with the US Government to support our funding. this money, coming from the U.S Government,” said Mbadi.

He, however, highlighted the need for accountability for the money pumped into the government through the deal.

Additionally, Duale noted the agreement provides a structured framework for health partnership, aligning US investments with Kenya's national health priorities while setting clear objectives, funding commitments and accountability measures.

It also marks the culmination of months of technical engagements aimed at strengthening local health systems, resilient supply chains and institutional capacity.

Actualisation of the deal had stalled following a court case that challenged data-sharing and national sovereignty concerns.

Petitioners, including Busia Senator Okiya Omtatah, argue the deal could expose citizens to privacy violations, stigma, and misuse of sensitive health information.

The case was, however, dismissed by the court, leading to the signing of the deal.

Currently, at least 33 countries have signed bilateral Memorandums of Understanding (MOUs) for health agreements under the US America First Global Health Strategy.

Amid the G2G funding model, health advocates are calling for Kenya to adopt a social contracting framework that would allow the government to directly finance civil society organisations delivering community health services.

Rosemary Mburu, Executive Director of WACI Health, explained to The Standard that for years, Kenya's HIV, TB and malaria programmes have largely been financed through international donors, particularly the Global Fund.

Under the current Global Fund financing model, money is channelled through principal recipients rather than directly from the government to community organisations.

In Kenya's dual-track system, the government is one principal recipient, while non-state actors receive funding through organisations such as Amref Health Africa for TB and malaria programmes, and the Kenya Red Cross Society receives funding for HIV programmes.

The non-state organisations then sub-grant the funds to smaller civil society and community-based organisations implementing services at the grassroots.

Mburu noted that the model has served the country well, but shrinking donor resources mean Kenya must prepare to finance these services using domestic resources.

"We are at a point where changing geopolitics and declining external funding require us to be more intentional about domestic resource mobilisation," Mburu said in an interview with The Standard.

With the G2G funding model, she said social contracting, then, becomes critical.

The model allows governments to allocate public funds directly to civil society and community-led organisations to deliver health programmes.

"Right now, Kenya does not have a legal framework that allows the government to contract civil society organisations directly. The Ministry of Health is developing policies to facilitate that arrangement," she said.

According to Mburu, the new framework will become increasingly important as donor support, including the Global Fund, shrinks,

"The funding envelope is becoming smaller. Principal recipients like Amref and the Kenya Red Cross Society will also receive fewer resources, meaning less funding will trickle down to community organisations. Unless we establish a mechanism for the government to finance these organisations directly, we risk losing critical community services," said Mburu.

She noted that Kenya has already drafted a social contracting policy, with elements of the approach incorporated into the country's preparations for the donor transition.

Mburu said community organisations should begin strengthening their governance, financial management and accountability systems to prepare for the new financing model.

“Smaller organisations have been providing door-to-door outreach, tracing patients who default on treatment, mobilising communities and reaching vulnerable populations that the formal health system often struggles to serve,” she said.

Additionally, Faith Ndung'u, a health policy and advocacy expert, noted that community organisations have helped reduce disease burden across the country and strengthened health systems.

Ndung’u said the G2G financing model is similar to existing donor funding arrangements in the health sector.

She explained that through on-budget financing, some donors channel funds to the government through the National Treasury.

Gavi, she said, uses G2G, while the Global Fund applies a dual financing approach, with part of its funding going through the Treasury and another portion supporting non-state organisations.

"Kenya has one health budget. Some donors provide funding to the government to run different health programmes, while others fund civil society organisations directly. As we transition, we need to strengthen social contracting, where the government finances civil society organisations to deliver health services alongside donor support," said Ndung'u.

She noted that previously, USAID funded non-governmental organisations directly, enabling them to reach communities and provide services that the government might not have reached.

"With the new model, it is important to strengthen how civil society organisations implement these interventions through social contracting," she said.

At least 34 countries have signed bilateral health cooperation agreements with the United States under the new America First Global Strategy.

Kenya was the first country to sign the agreement, securing a five-year funding package worth $2.5 billion.

Under the broader strategy, the US has committed a total of $23.6 billion across participating countries over the five years.

Kenya has the third-largest funding package under the initiative, with a 34 per cent co-financing commitment.

Nigeria has the largest allocation at $5.1 billion, with a 59 per cent co-financing requirement, followed by Tanzania, which will receive $3.1 billion with a 58 per cent co-financing commitment.

Other countries that have signed the agreements include Uganda, Mozambique, Ethiopia, the Democratic Republic of Congo (DRC), Côte d'Ivoire, Malawi, Cameroon, Botswana, Lesotho, Burkina Faso, Eswatini, Rwanda, Niger, Liberia, Madagascar, Sierra Leone, South Sudan, Burundi, Guinea, Angola, Senegal, Tajikistan, Guatemala, the Dominican Republic, El Salvador, Honduras, Cambodia, Panama, Papua New Guinea, Bolivia and the Philippines.

Zambia, Zimbabwe and Ghana have yet to sign the agreements.

Zimbabwe has cited concerns over data sovereignty and what it describes as unfair terms. Zambia suspended negotiations after objecting to provisions linking health assistance to access to critical minerals, while Ghana raised concerns over the sharing of sensitive national health data.