Finance Ministers must act decisively this week in establishing the new Pandemic Preparedness and Response fund and architecture
OPED BY: PROF. DR. MARIANA MAZZUCATO, CHAIR WHO COUNCIL ON THE ECONOMICS OF HEALTH FOR ALL; ALAN DONNELLY, FOUNDER AND CONVENOR OF THE G20 HEALTH AND DEVELOPMENT PARTNERSHIP
With over two thirds of the people on the African continent still unvaccinated against COVID-19, it is clear that global pandemic preparedness and response (PPR) remains seriously underfunded and lacks resilient systems of delivery.
The World Health Organization Access to COVID-19 Tools Accelerator (ACT-A) plays a central role in addressing the current gross inequity in access to COVID testing, treatments and vaccines, but still lacks the financial commitments to comprehensively support low-income countries.
The science and economics of the last two years demonstrate that a future air-born pandemic could kill millions of people and bring economic chaos, especially with increased urbanisation and climate change. A new pandemic represents an existential threat to humanity. As with the battle against global warming, the cost of inaction is much greater than the cost of action. We must act now.
The Italian Presidency of the G20 last October set out the roadmap to ensure the world is better prepared for the next global health challenge. In the coming days, G20 Finance Ministers and Central Bank Governors will meet to receive a progress report from the G20 Joint Finance and Health Taskforce – the body created to take forward this PPR roadmap.
Central to this new strategy is the creation of an effective and properly funded Financial Intermediary Fund (FIF). The World Health Organization and the World Bank estimate there is currently at least a $10.5 Billion annual gap in PPR financing. This is the minimum amount of additional financing required each year to support equitable access to vaccines, testing and therapies, global surveillance, research and development, manufacturing and health system strengthening
This is a tiny fraction of the trillions of dollars deployed to mitigate the current COVID-19 pandemic and the trillions of dollars in lost economic activity.
There are four critical factors that finance ministers consider.
The first is that an effective and sustainable FIF cannot be adequately resourced through occasional pledging or replenishment initiatives.
Finance ministers of the G20+ must agree to meet the $10.5 billion minimum annual budget for a total of $50 Billion in up front multi-annual funding for the FIF’s first five years. Building financial commitments into countries’ annual budgets for the FIF allows effective planning and deployment of the fund.
Furthermore, the Fund must promote innovative and blended finance mechanisms that leverage the FIF’s investments. In tackling climate change, governments, development banks, philanthropy and the private sector are already developing highly effective new partnerships working to achieve Net Zero.
G20 Finance Ministers should create an expert group to identify best practices from green financing models that could be deployed by the FIF for investments in PPR.
Given the constraints to fiscal space in low- and middle-income countries, (LMICs) new and additional investments in public health systems and PPR by those countries, compatible with the objectives of the Fund, should be recognised as ‘in kind’ contributions to the FIF.
Second, the FIF must have an effective evaluation mechanism, which ensures the efficient use of these new resources. Using agreed metrics to measure the socio-economic impact of the FIF’s investments, the evaluation mechanism must give donors confidence there is a measurable return on their long-term commitment to the Fund.
Third, the funding of the FIF must not undermine programmes that are addressing other urgent public health needs and systems strengthening. High income countries’ contributions to the Fund must be additional to existing Official Development Assistance to ensure that the FIF doesn’t poach from other critical health and development needs as LMICs struggle to recover from the COVID-driven economic crisis.
Finally, the G20 Leader’s declaration from October 2021 recognised that universal access and participation in governance is needed to achieve the legitimacy, fairness and inclusion required to generate buy-in from LMICs. This includes making sure that the way that production and innovation of vaccines, diagnostic tests and therapeutics are governed with principles of collective intelligence, with the widest possible sharing of the underlying knowledge.
The FIF should move away from an outdated and inequitable donor/beneficiary framework. Equal representation should be given across high-, middle- and low-income countries in the FIF’s formal governance structure and it should also include core global and regional implementing institutions such as the WHO and African CDC, as well as independent experts from across society.
The G20 Finance Ministers must prevent any territorial disputes – which is why the FIF should be hosted by the World Bank, and the WHO must play a critical role in the development and execution of the FIF strategy.
Both organisations however must recognise that to build the required expertise and capacity to guarantee the successful implementation of strong PPR, they must actively encourage the widest involvement of all stakeholders through new and innovative partnerships together with full transparency.
The Indonesian G20 Presidency must drive this initiative to an early conclusion – that is why the G20 Finance Ministers meeting during the World Bank – IMF Spring gathering in the coming days in Washington must act decisively in addressing the financing and architecture of the new PPR Fund.