Leaders of Namibia and South Africa -- two nations hardest hit by the HIV/AIDS pandemic -- have rejected participation in a $1 billion a year low-interest loan program announced last month by U.S. officials.

It's likely that most if not all of the 24 sub-Saharan nations also will reject the plan as regional officials say what they need are low-cost drugs -- not more loans that must be repaid, the New York Times reports.

The loans -- offered by the Export-Import Bank of the United States -- would allow southern African nations to buy drugs and medical supplies to combat high HIV/AIDS infection rates. This package was expected to be matched by Japan and the European Union as part of a grassroots campaign to slow HIV/AIDS transmission from mothers to infants and treat patients suffering from other infections brought on by HIV.

Leaders of the Southern African Development Community, which represents 14 countries in the region, including South Africa and Namibia, say the loan package misses the point.

"Members are already burdened by debt. Making drugs affordable is the solution rather than offering loans that have interest," Dr. Thuthula Balfour, the organization's health director, told the Times.

These nations are asking pharmaceutical firms to either dramatically slash the cost of their patented drugs -- which even with steep discounts can cost a minimum US$2,000 a year per patient, a huge sum compared to Third World incomes -- or waive patent protection and allow these nations to produce lower-cost generic versions, the newspaper reports.

The UNAIDS organization is negotiating with a handful of drugmakers for price reductions, but these firms have been fighting to protect their patents, the Times reports.

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