The intergovernmental organization managing global trade relations, World Trade Organization’s (WTO) Director-General Ngozi Okonjo-Iweala has warned that the global economy will have to wait a long time to achieve herd immunity if the current vaccine distribution disparity continues.
Just 0.1 percent of vaccines that have been administered so far have been in low-income countries, while 86 percent have been given out in high- and middle-income countries, according to the WTO’s head during an online panel discussion at the International Monetary Fund’s Spring Meeting.
“If we don’t do something to change the pace at which the poorer countries are getting access to vaccines, it will take a long time to get to herd immunity for the world. This is really in the self-interest of everyone. As we know, mutations and variants are coming out and the rest of the world that has been vaccinated might see the gains they’ve made reversed,” Ms. Okonjo-Iweala said.
Recently, the International Monetary Fund (IMF) revised its global economic growth forecast for this year to 6 percent, up from 5.5 percent in January, noting the rapid vaccine deployment and significant fiscal and monetary support by governments and central banks.
As per the reports, “the fund also warned of a “divergence” – between countries such as China and the US whose economies are likely to return to pre-pandemic levels this year and low-income countries and smaller, tourism-dependent islands that will still be much poorer.”
“The governments and central bankers acted “swiftly, decisively and on a large scale” to the economic threat caused by the pandemic, with $16 trillion of fiscal stimulus and the equivalent of $10 trillion in accommodative monetary policy. For this year and next, though, “vaccine policy is economic policy. It is even a higher priority than the traditional tools of fiscal and monetary policy. Without it, we cannot turn the fate of the world economy around.”
According to Paschal Donohoe, Ireland’s finance minister and president of the Eurogroup, the vaccination program in Europe took time to develop with 28 million vaccines distributed to the EU’s 448 million people in February.
“By the time we get to April, we expect that to be 100m vaccines and the goal that the EU has of vaccinating 70 percent of our adult population by the summer, we will get there and we will deliver that. This will lay the foundation for the EU to be able to supply “billions” of vaccines to the world next year from 50 manufacturing sites throughout the bloc,” Mr. Donohoe commented.
Furthermore, Ms. Okonjo-Iweala noted that the global trade, which contracted 5 percent last year, will grow 8 percent this year.
“We see imports and exports in Asia and North America rebounding quite quickly and faster than, say, sub-Saharan Africa and the Middle East. So the divergence we see in recovery is reflected also in divergence in trade,” WTO head added.