The Global Fund to Fight AIDS, Tuberculosis and Malaria has announced $1.6 billion in grants aimed at life-saving projects in 40 countries in the developing world, but has yet to give away a single penny. That is largely because of demands led by the Bush administration that the new fund set up a worldwide aid delivery system from scratch -- instead of relying on established agencies the administration distrusts, such as the UN and World Bank. The fund is now caught in a dilemma between poor nations' need for immediate help and donors' antipathy toward agencies set up to provide it the fastest.

Tanzania, for example, was promised $25 million for AIDS and malaria projects in the first round of grants in April. "We're now awaiting a reply from them as to when we can have these funds," said Maj. Gen. Herman Lupogo, head of the Tanzanian Commission for AIDS. "We needed them yesterday."

The Bush administration is openly dubious that past aid funneled through established agencies has had any positive effect -- a topic Treasury Secretary Paul O'Neill stressed during his African jaunt with rock star Bono. In pledging $500 million to the fund, the Bush administration insisted -- joined by Britain and some other donors -- that the fund shun existing aid agencies and build its own system. That means it has to line up its own procurement, administrative, auditing and other services for each grant.

Although the fund has a new executive director, Dr. Richard Feachem, it is still advertising for many senior positions -- another holdup in distributing funds. Feachem hopes to get money to a handful of projects by the time his board next meets in October, but that goal remains up in the air. The vast majority of grant winners probably will not see any funds until the end of the year or later. In addition, Feachem promised the fund staff will number no more than 50, meaning it likely will have to hire outsiders to monitor projects in what could ultimately be more than 100 countries.

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