Global Financing to End the Pandemic
A new allocation of up to $650 billion worth of the IMF’s reserve asset, special drawing rights, would ensure that governments have the means to combat the coronavirus pandemic and start on the path of investment-led recovery. We must seize this critical opportunity to cooperate effectively for the sake of humanity.
NEW YORK – This week’s spring meetings of the International Monetary Fund and the World Bank offer a historic chance for financial cooperation. The major economies, including the United States, the European Union, China, and other G20 countries, have already signaled their support for a new allocation of $650 billion worth of the IMF’s reserve asset, special drawing rights (SDRs), to ensure that governments in low-income and middle-income countries have the means to combat the COVID-19 pandemic and start on the path of investment-led recovery. With leadership, boldness, and creativity, this global financial cooperation can help to end the pandemic.
Mass immunization is key. Less than a year after SARS-CoV-2, the virus that causes COVID-19, was first identified and sequenced, financial backing by governments – including the US, United Kingdom, Germany, Russia, China, and India – enabled several companies to roll out safe and effective vaccines. Rich countries that quickly negotiated favorable deals with vaccine makers have received most of the doses so far. But ending the pandemic requires that all countries achieve comprehensive vaccine coverage as soon as possible. In practical terms, the target should be no later than the end of 2022.
Such an unprecedented global undertaking requires strong cooperation, including financial support. Yet the urgency should be clear to all. As long as COVID-19 persists at high rates of transmission anywhere in the world, the pandemic will continue to disrupt global production, trade, and travel, and will also give rise to viral mutations that threaten to undermine previously acquired immunity from past infections and vaccinations. Still worse, on the current trajectory, COVID-19 could well become endemic in many regions of the world, imposing high health and economic costs for years to come. As US Treasury Secretary Janet Yellen emphasized this week, all countries, therefore, share a strong interest in ending the pandemic everywhere.