The Global Fund to Fight AIDS announced on Tuesday that its head Michel Kazatchkine will quit but denied media reports that it was connected to his links with French first lady Carla Bruni-Sarkozy.
Kazatchkine, a French clinician and health advocate, said in a statement he had decided to step down as executive director in March following the organisation's decision to appoint a general manager.
But the chairman of the fund's board denied a report by France's Liberation newspaper Tuesday that his decision was linked to allegations of possible irregularities involving the wife of French President Nicolas Sarkozy.
"I categorically deny the information (published on Liberation's website) saying Michel Kazatchkine reportedly resigned because of the questioning of his links with Carla Bruni-Sarkozy," Simon Bland said in a statement.
"What was written was false and without foundation and we are demanding the retraction of the article," he said in a statement to AFP.
The fund had issued a statement on January 6 describing an article in French weekly Marianne which suggested the organisation had benefitted charities linked to Bruni-Sarkozy as "inaccurate and misleading".
Kazatchkine, who was appointed executive director of the Global Fund to Fight AIDS, Tuberculosis and Malaria in 2007, said he was "immensely proud" of what the fund had achieved since it was set up in 2001.
Its board decided in November to create a new post of general manager to oversee the agency's reorganisation and on Tuesday announced the appointment of former Sovreign Bank chairman Gabriel Jaramillo.
Kazatchkine said that although he "trusts that the decision was made in the best interests of the Global Fund", he decided that he should not continue as executive director.
He said he would ensure a smooth transition while Bland paid tribute to his work, saying all the fund's successes bore his mark.
The Global Fund is the world's biggest single source of funding to tackle three of the world's greatest killer diseases, with a multi-billion dollar budget drawn from more than 100 countries and private donors.
It provides grants for projects in developing nations, allocating money provided by governments and supporters such as the Bill and Melinda Gates Foundation.
The fund announced it was to beef up its financial safeguards in February last year after auditors found that $34 million (then 25 million euros) had gone missing or been taken in four African countries before it reached needy community aid programmes, leading Germany to suspend its payments.
At the beginning of the year Marianne reported that the Global Fund had given "significant sums" to charities linked to Bruni-Sarkozy, a fund ambassador, and one of her close friends.
The fund issued a response saying that costs related to the Born HIV Free campaign, supported by the former model, "were in full compliance with Global Fund's stringent rules and procedures."
Columbian native and Brazilian citizen Jaramillo will take up the 12-month managerial post on February 1.
He said in a statement he was honoured to have been asked to pick up the challenge.
Since his retirement as Sovreign Bank CEO in January last year he has served as an advisor to the Office of the Special Envoy for Malaria of the United Nations secretary-general, the fund said. He remained chairman of the bank until June.
Global Fund's Michel Kazatchkine, veteran AIDS campaigner
French clinician and health advocate Michel Kazatchkine, who on Tuesday announced he would quit as head of the Global Fund, is one of the most popular figures in the three-decade struggle against AIDS.
Kazatchkine, 65, said he will step down on March 16 as the Fund said it was appointing a "general manager" to overhaul the organisation, which on the brink of its 10th anniversary is struggling with the problems of swift growth.
He was first named executive director of the Global Fund to Fight AIDS, Tuberculosis and Malaria in 2007 and was reappointed for a three-year term in 2011.
During his tenure, the Fund became the leading multilateral financing mechanism to combat AIDS, helping to gear up distribution of life-saving drugs to millions of Africans with HIV.
It also became the main funder of programmes to fight TB and malaria.
But as this unique public-private partnership expanded, it also ran into criticism that its structure -- designed to be fast in response and low in bureaucracy -- could not adequately track the funds it allocated.
Kazatchkine was born in the Paris suburb of Courbevoie to a Russian emigre family of modest background. He was a brilliant student at the city's elite Louis-le-Grand high school.
He abandoned early ambitions to become a Latin teacher and instead concentrated on medicine, studying nephrology and haemotology in Paris before post-doctoral work in London and Harvard Medical School.
The turning point in his career was in 1983 when he witnessed the first cases of AIDS in France, beginning with a French couple who had been airlifted from Africa and were dying of a mysterious immune deficiency.
The shock of this novel, incurable disease prompted him to set up his own laboratory, where he carried out research into immunology.
Two years later, he also set up a special clinic -- essentially an open house for anyone with AIDS, at a time of rampant stigma and discrimination -- and it was the success of this project that propelled him to national recognition.
In 1998, he became director of France's National Agency for AIDS Research (INRA), a role that entailed relentless travelling across the developing world to set up AIDS programmes there.
Before his appointment as Global Fund boss in 2007, he also served as vice chair of the Fund's board as the first chairman of the organisation's technical review board, which assesses the quality of grant proposals.
Tall and slim, fluent in English and French and a lover of baroque music, Kazatchkine is extremely popular with grassroots activists.
Many praise his passion for the cause and his championing of the Fund's commitments to people with HIV, in contrast to other financial institutions often seen as technocratic or remote.
"Michel is an inspiring man and an amazing advocate for civil society," Andriy Klepikov, executive director of a Ukrainian NGO called Alliance Ukraine, said in email to AFP.
"He has brought much hope through his work at the Global Fund, tirelessly supporting people living with and affected by HIV/AIDS."
In a statement, the chairman of the Fund's board, Simon Bland, said, "Few individuals have played a more central role in the creation and evolution of the Global Fund than Michel."
"His unwavering commitment to health, to human rights and to supporting the weakest and the unprotected has helped shape the Global Fund into the beacon of hope it is today for tens of millions of people around the world."
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