A Proposal to End the COVID-19 Pandemic
IMF Blog, May 21, 2021
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- Authors: Kristalina Georgieva, Gita Gopinath, Ruchir Agarwal
- Published: May 21, 2021
Overview & Rationale
- Many countries and institutions (World Health Organization, the World Bank, Gavi, the African Union, and others) have stepped up in the global fight against the pandemic.
- As of the end of April 2021, less than two percent of Africa’s population had been vaccinated; over 40 percent of the population in the United States and over 20 percent in Europe had received at least one dose of the vaccine.
- New cases worldwide are higher than ever more than a year into the COVID-19 crisis; urgent action is needed to arrest the rising human toll and economic strain.
- Pandemic policy is economic policy: there can be no lasting end to the economic crisis without an end to the health crisis.
- Ending the pandemic is a solvable problem but requires further coordinated global action, including upfront financing, upfront vaccine donations, and "at-risk" investment to insure against downside scenarios.
Targets and Strategy
- Vaccination targets:
- Vaccinate at least 40 percent of the population in all countries by the end of 2021.
- Vaccinate at least 60 percent by the first half of 2022.
- Complementary measures:
- Track and insure against downside risks.
- Ensure widespread testing and tracing.
- Maintain adequate stocks of therapeutics.
- Enforce public health measures in places where vaccine coverage is low.
Financing and Costs
- Total cost of the proposal: around $50 billion, composed of grants, national government resources, and concessional financing.
- Strong case for grant financing of at least $35 billion.
- G20 governments have already identified addressing the $22 billion grant funding gap noted by the Access to COVID-19 Tools (ACT) Accelerator.
- Estimated additional grant contributions needed: $13 billion.
- Remainder of overall financing plan: around $15 billion could come from national governments, potentially supported by COVID-19 financing facilities created by multilateral development banks.
Economic Benefits
- A faster end to the pandemic could inject the equivalent of $9 trillion into the global economy by 2025 due to a faster resumption of economic activity.
- Advanced economies would capture 40 percent of the cumulative $9 trillion in global GDP gains and roughly $1 trillion in additional tax revenues.
Recommendations for Action
- Achieving the vaccination targets:
1. Provide additional upfront grants to COVAX of at least $4 billion. This financing will help finalize orders and activate unused vaccine capacity. 2. Ensure free cross-border flows of raw materials and finished vaccines: Such restrictions are jeopardizing access to vaccines for billions of people in the developing world. 3. Immediately donate surplus vaccines: Projected at least 500 million vaccine courses (equivalent to around 1 billion doses) can be donated in 2021, even if countries give preference to their own populations. Donations, including for delivery costs, should be done through COVAX so vaccines are shared on equitable and public health principles.
- Insuring against downside risks:
4. Make at-risk investments to diversify and increase vaccine production capacity by 1 billion doses in early 2022 to handle downside risks in 91 low- and middle-income countries, including from new variants that may require booster shots. [$8 billion] 5. Scale up genomic surveillance and systemic supply chain surveillance with concrete contingency plans in place to handle possible mutations or shocks to the supply chain. These plans should be prepared with the participation of multilateral agencies, vaccine developers and manufacturers, and key national governments. [$3 billion]
- Managing the interim period when vaccine supply is limited:
6. Ensure widespread testing, sufficient therapeutics, public health measures, and prepare for vaccine deployment. [$30 billion] 7. Urgently evaluate and implement (where approved) dose stretching strategies to expand effective supply. [$2 billion]
- Additional needed measures account for $3 billion.
- Steps 4–7 are needed to insure against downside risks, and to mitigate the health consequences of the pandemic in the interim period.
- The measures in steps 1–3 may be sufficient to achieve the 40 percent vaccination target by the end of 2021 and the 60 percent target by the first half of 2022, if no downside risks materialize.
Complementarity and Conclusion
- The proposal complements the work of the G20 High Level Independent Panel, the G7 Pandemic Preparedness Partnership group, and the Report of the Independent Panel for Pandemic Preparedness and Response, which primarily focus on addressing future pandemics; this proposal focuses on bringing the current pandemic under control.
- With strong global action now and with very little in terms of financing relative to the outsized benefits, the world can durably exit this health crisis and avoid another record surge of COVID-19 cases.
Source: A Proposal to End the COVID-19 Pandemic (IMF blog, May 21, 2021).
