As preparations are made for the G7 Summit in the UK next week, top of the agenda is how to end the COVID-19 pandemic and secure the global recovery. Urgent challenges face us.
By now it has become abundantly clear there will be no broad-based recovery without an end to the health crisis. Access to vaccination is key to both.
There has been impressive progress on the vaccination front. Scientists have come up with multiple vaccines in record time. Unprecedented public and private financing has supported vaccine research, development and manufacturing scale-up. But a dangerous gap between richer and poorer nations persists.
In fact, even as some affluent countries are already discussing the rollout of booster shots to their populations, the vast majority of people in developing countries—even front-line health workers— have still not received their first shot. The worst served are low-income nations which have received less than 1 percent of vaccines administered so far.
Increasingly, a two-track pandemic is developing, with richer countries having access and poorer ones being left behind.
Inequitable vaccine distribution is not only leaving untold millions of people vulnerable to the virus. It is also allowing deadly variants to emerge and ricochet back across the world. As variants continue to spread, even countries with advanced vaccination programs have been forced to reimpose stricter public health measures, and some have implemented travel restrictions. In turn, the ongoing pandemic is leading to deepening divergence in economic fortunes, with negative consequences for all.
It need not be this way. That is why we are calling today for a new level of international support for – and implementation of – a stepped up coordinated strategy, backed by new financing, to vaccinate the world.
A recent proposal from IMF staff puts forward a plan with clear targets, pragmatic actions, and at a feasible cost. It builds on and supports the ongoing work of WHO, its partners in the Access to COVID-19 Tools (ACT) Accelerator initiative and its global vaccine access programme COVAX, as well as the work of the World Bank Group, the WTO and many others.
At an estimated $50 billion, it will bring the pandemic to an end faster in the developing world, reduce infections and loss of lives, accelerate the economic recovery, and generate some $9 trillion in additional global output by 2025. It is a win for all — while around 60 percent of the gains will go to emerging markets and developing economies, the remaining 40 percent will benefit the developed world. And this is without taking into account the inestimable benefits on people’s health and lives.
What does it entail?
First, increasing our ambition and vaccinating more people faster: WHO and its COVAX partners have set a goal of vaccinating approximately 30% of the population in all countries by the end of 2021. But this can reach even 40% through other agreements and surge investment, and at least 60 percent by the first half of 2022.
To do so requires additional financing for low- and middle-income countries, with a very significant proportion in the form of grants and concessional financing. To urgently get more shots in arms, doses need to be donated immediately to developing countries synchronized with national vaccine deployment plans, including through COVAX. Cooperation on trade is also needed to ensure free cross-border flows and increasing supplies of raw materials and finished vaccines.
Second, insuring against downside risks such as new variants that may necessitate booster shots. This means investing in additional vaccine production capacity by at least one billion doses, diversifying production to regions with little current capacity, sharing technology and know how, scaling up genomic and supply-chain surveillance, and contingency plans to handle virus mutations or supply shocks.
All blockages to expanding supply must be removed, and we call on WTO members to accelerate negotiations towards a pragmatic solution around intellectual property. A number of low- and middle-income countries are also making moves to invest in their own local manufacturing capacity, which is key not to just end this pandemic but to prepare for the next one.
Third, immediately boosting testing and tracing, oxygen supplies, therapeutic and public health measures, while ramping up vaccine deployment, and the ACT-Accelerator initiative. WHO, UNICEF, the World Bank and Gavi have been conducting vaccine readiness assessments in over 140 developing countries, and providing on-the-ground support and financing to prepare for vaccine rollout.
What about the cost?
Of the $50 billion, there is a strong case for grants of at least $35 billion. G20 governments have sent positive signals, recognizing the importance of providing about $22 billion in additional funding for 2021 to the ACT-Accelerator.
Additional financing of about $13 billion is needed to boost vaccine supply in 2022 and further scale up testing, therapeutics and surveillance. The remainder of the overall financing plan—around $15 billion—could come from national governments supported by multilateral development banks, including the World Bank’s $12 billion financial facility for vaccination.
For the plan to work, there are two additional requirements: speed and coordination.
It calls for upfront financing, upfront vaccine donations, and upfront precautionary investments and planning – rather than commitments that may be slow to materialize. It is essential that all of this is made available as soon as possible.
It also requires coordinated global action, grounded in full transparency in the procurement and delivery process. The success of the strategy depends on all parties—public, private, international financial institutions, foundations—moving in tandem.
Investing $50 billion to end the pandemic is potentially the best use of public money we will see in our lifetimes. It will pay a huge development dividend and boost growth and well-being globally. But the window of opportunity is closing fast — the longer we wait, the costlier it becomes, in human suffering and in economic losses.
On behalf of our four organizations, today we announce a new commitment to work together to scale up needed financing, boost manufacturing and ensure the smooth flow of vaccines and raw materials across borders to dramatically increase vaccine access to support the health response and economic recovery, and to bring needed hope.
Our institutions are stepping up to turn this hope into reality:
The IMF is preparing an unprecedented Special Drawing Rights (SDR) allocation to boost the reserves and liquidity of its members. The WHO is seeking to identify financing so that the urgent needs of its Strategic Preparedness and Response Plan and the ACT-Accelerator partnership can be met, with COVID-19 Technology Access Pool (C-TAP) incentivizing the sharing of know-how and technology. The World Bank will have vaccine projects up and running in at least 50 countries by mid-year—with the International Finance Corporation working to mobilize the private sector to boost vaccine supply for developing countries. And the WTO is working on freeing up supply chains for the plan to succeed.
Ending the pandemic is a solvable problem that requires global action—now.
Let’s all pull together and get the job done.
Kristalina Georgieva is Managing Director of the International Monetary Fund; Tedros Adhanom Ghebreyesus is the Director-General of the World Health Organization; David Malpass is the President of the World Bank Group; and Ngozi Okonjo-Iweala is the Director-General of the World Trade Organization.