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15 April 2020

No government can solve this crisis on its own

Douglas Alexander

DOUGLAS ALEXANDER: Neither nativism nor nationalism offer a way out


This week sees virtual meetings of the G20, the World Bank and the International Monetary Fund. It's hard to overestimate the importance of these gatherings. In the grip of a pandemic, the world urgently needs an agenda for action to tackle Covid-19 and its consequences. 


In recent weeks we have seen the virus spread across the globe and overwhelm some of the most advanced healthcare systems on earth. So far, Africa and the Middle East have been spared the worst of the virus. Yet, research by Imperial College suggests a delayed response to the pandemic "will cost at least 3 million lives" in Sub-Saharan Africa and Asia, because even though the number of cases in Africa at the moment is mercifully low, the threat remains huge. The World Health Organisation has urged quick action in the face of the "tremendously fast rise in the number of countries with cases being confirmed". A 2016 report by the RAND Corporation, on the countries most vulnerable to infection outbreaks, confirmed that 22 out of 25 of those countries were African. The others were Haiti, Yemen, and Afghanistan. 


While Europe today has one doctor for every 300 people, the continent of Africa as one doctor for every 70,000 people. As the New York Times has reported, the United States has some 160,000 ventilators, while Sierra Leone has 13, South Sudan has four, and the Central African Republic has three. This means that doctors and hospitals across Africa and the developing world will only be able to treat a fraction of those needing treatment if the virus takes hold and spreads in the weeks and months ahead through densely populated cities and rural villages. At the same time, it's clear that in the absence of a vaccine, the presence of a virus in developing countries will continue to have a direct bearing on the health and wellbeing of OECD countries. As Ellen Johnson Sirleaf, former President of Liberia, has stated: "Coronavirus anywhere is a threat to people everywhere". In a literal sense we are only as strong as each other's response, and our wellbeing is now bound up with each other's wellbeing around the world.


Yet while Covid-19 is primarily a health crisis, the actions needed to tackle it are already having profound and damaging economic consequences. The United Nations has warned that the loss of income in the developing world could exceed $220 billion. Given the fall in oil and commodity prices, the collapse of tourism, and the wider disruption to global supply chains, the economic impact of the virus is already being felt across the developing world. The IMF has slashed its Global Growth Forecasts and warned of a slump the likes of which the world has not witnessed since the Great Depression of the 1930s. So, the challenge now is to avoid a global recession becoming a global depression and undoing decades of progress in international development. 


So far, coordinated global leadership has been singularly lacking in this crisis. Disunity and division not cooperation and coordination has sadly been the international response to date. The United Nations Security Council has been silent to the point of irrelevance. Back in 2008 to 2010, at the time of the global financial crisis when I served in the British Cabinet as International Development Secretary, the G20 galvanised disparate governments to act together to ward off the threat of a global depression. Of course, today's leaders are different. Of course, the multilateral system has been weakened in the intervening years. Of course, governments have focused first on the crisis within their own countries. But, self-evidently, this is a crisis that no government can solve acting on its own. That's why coordinated action is needed now to meet both the health and economic dimensions of this global crisis. 


The contours of that agenda for action are already emerging. To address the most urgent requirements of the Covid-19 response, world leaders must this week commit to $3 billion for vaccines: The Coalition for Epidemic Preparedness Innovations (CEPI) is coordinating the global research effort to develop and scale up effective Covid-19 vaccines. In addition, Gavi, the international vaccine alliance, will have a key role in procuring and distributing fairly vaccines to the poorest countries and will require $7.4 billion for its replenishment, which needs to be fully funded. 


Secondly, the Covid-19 therapeutics accelerator aims to deliver 100 million treatments by the end of 2020 and is seeking $2.25 billion to rapidly develop and scale up access to therapeutics. The World Health Organisation needs support not criticism: To be able to fulfil its mandate effectively at this critical time, it requires an additional $1 billion this year, which must be funded in full by member state governments.


Yet the economic impacts of this crisis also require immediate action. 64 countries globally and 30 countries in Sub-Saharan Africa today spend more on public debt servicing than public health. To take just one example, the Gambia spends nine times its health budget on external debt repayments: for every million people it has 100 doctors, compared to 2,900 in OECD countries. That's why the G20 this week should kickstart a comprehensive debt restructuring process for African and IDA countries that need that assistance. Sub-Saharan African countries owe at least $365.5 billion to official and private creditors. That's why action on debt restructuring is necessary now. 


Nobody can yet know the full economic, social and political consequences of this pandemic. What we can do is to work together and cooperate across borders to meet the challenge of a virus that recognises neither national borders nor political ideology. Neither nativism nor nationalism offer us a way out of this crisis. Only by working together can we rise to this challenge. A global pandemic can only be met by global action. That action is needed now. 


Douglas Alexander is a Visiting Professor at the Policy Institute, King’s College London, and a former UK Governor to the World Bank.

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