Daniel Kiesa

Duty waivers, exemptions from import taxes for donor-funded health commodities, have played a vital role in the global response to infectious diseases. By removing taxes on imported medicines and supplies, donors and implementing partners have been able to stretch limited resources further, delivering more treatments and saving more lives.

In the early 2000s, at the height of the HIV epidemic, this mechanism was essential. Originator medicines were expensive, donor and national budgets were constrained, and every dollar saved meant more people on treatment. Duty waivers were an elegant solution to an emergency, a practical workaround that expanded access to medicines and accelerated impact.

But as with many good ideas, what worked then may not be what’s needed now.

The Cost of Non-Standard Import Pathways

Duty waivers create non-standard importation processes, typically accessible only to select donor-funded institutions. While this arrangement works within donor programs, it limits broader market participation. Commercial companies, including wholesalers, local distributors, and private buyers, struggle to enter markets where donor-funded commodities are present. The difference in cost, driven by whether or not duty is paid, leads to an inability to compete on pricing.

Even more critically, these non-standard import processes take time. Securing a duty waiver can take weeks or even months as it navigates the government bureaucracy, delaying the delivery of essential health commodities. In time-sensitive responses, such as HIV prevention and treatment or outbreak control, these delays translate directly into poorer health outcomes.

In other words, by saving money on import taxes, we may be paying a hidden cost in lost time and reduced responsiveness.

A Hidden Barrier to Local Manufacturing

While donor-funded commodities enter countries duty-free, locally manufactured products are produced using taxed materials, including raw ingredients, packaging, and equipment. This creates a cost imbalance that favors imported goods and discourages local production.

When global health programs rely heavily on duty-free imports, they undercut the business case for local manufacturing, reinforcing dependency instead of supporting sustainable, regionally anchored supply capacity.

Evolving for the Next Chapter of Global Health

Duty waivers were a smart and necessary tool in an earlier era, one defined by scarcity, emergency response, and dependence on originator medicines. But as global health evolves toward sustainability, localization, and market-driven access, these mechanisms must evolve too.

Reimagining the duty waiver landscape will require collaboration among donors, normative agencies, and, most importantly, national governments, who oversee import processes and revenue systems.

Perhaps the revenues from duty payments could be reinvested in strengthening national health systems. Or perhaps life-saving commodities, regardless of the importer, could be exempted from duties altogether, creating a level playing field for all suppliers.

The goal is no longer simply to avoid costs - it’s to build resilience, competition, and local ownership in health supply chains.