Fiscal space for HIV and health in a polycrisis era: A descriptive macro-comparative analysis of financing asymmetries

Overlapping global shocks have renewed concerns about the sustainability of health financing in low- and middle-income countries. This paper examines how COVID-19, commodity price shocks, exchange rate pressures and debt dynamics affected fiscal space for HIV and health across country income groups. Using a descriptive macro-comparative design, it draws on IMF, World Bank, OECD, UNAIDS and Global Fund data to compare trends in growth, inflation, fiscal balances, public debt, external financing and HIV resource availability. The analysis shows that COVID-19 generated a broadly shared output shock but a highly unequal fiscal response: high-income countries mobilised around 428 times more per capita than low-income countries. Real GDP growth alone understates fiscal pressure because import bills, currency depreciation and health commodity prices affect budget purchasing power. Commodity shocks and tighter financing conditions further exposed countries with high import dependence, external debt and limited concessional finance. The paper does not estimate causal effects on HIV outcomes or UHC. Rather, it identifies macro-fiscal channels through which overlapping crises can constrain HIV and health financing sustainability. The findings support a sequenced response in which governments protect priority interventions, mobilise domestic revenue where feasible and strengthen budget execution; external partners provide predictable, differentiated transition finance; and creditors and international financial institutions deploy debt solutions where debt service crowds out essential social spending.