Commentary : Advanced economies should not delay their feet in universal immunization

[Compass Real Estate Platform - June 02] Billions remain unprotected in developing nations, but advanced economies can do more to equitably share vaccines, Mohamed A El- Erian believes. Trust depends on the proper operation of any interrelated economic system.

And an advanced economy-designed global system requires considerable buy-in from poorer countries. Both are even more significant as the systemic importance of more developing economies, led by China.

In trying to recover, the globe has undermined confidence in the international structure that formed after the World War II in response to the tremendous economic shock caused by COVID-19. Combined with the 2008 global financial crisis, which originated in the advanced nations, today's shortcomings reinforce some countries' worries that international order may cease to fit in. 

These problems must be taken seriously by the West in particular. The only option is a global fragmentation and escalating economic, social and political conflicts without a different multilateral structure to replace the current system.

#BILLIONS REMAIN COMPLETELY UNPROTECTED

Although the UK has taken the lead in vaccinating its people in most other nations, the fight to prevent infections from India by the new B1617 version is a timely remedy because nobody is safe until everybody is present.

While "almost half of the US and UK citizens receive at least one" dosage of a vaccine of COVID-19 currently, this figure decreases to 11 per cent, notes former UK Premier Gordon Brown. Barely 1% of the population in Sub-Saharan Africa has got a single dosage.

This allows them, while milliards of people in the impoverished world remain fully unprotected, to vaccinate sections of their populations that are even low vulnerability – including children as young as 12.

 #MORE VACCINES SHARING

It is estimated that by 2021 countries with big supplies of vaccines might give 1 billion doses without compromising their domestic vaccine priority. In addition, several affluent economies have stockpiled huge stockpiles of vaccines as they prepare a round of boosters in autumn.

The lack of financing for COVAX is further underlined by their hesitation in supporting the rest of the world as an international institution to provide a fair worldwide access to vaccinations.

But it's a practical and not only a moral and ethical failure. According to IMF estimates, another $50 trillion in investment would provide $9 trillion in economic gains for global vaccination efforts.

#RESPONSIBLE CONDUCT OF STEWARDS

The long-term damage to an already stressed international system is the longer the worldwide vaccine roll-out fumbles. Designed almost 80 years ago, this system is focused on advanced economies that have long been the major public goods, such as the stable US dollar and the major multilateral funding.

The advanced economies have received huge privileges in exchange for these contributions, including the de-facto veto on global governance, seigniorage of the currencies and cheaper everyday financing costs (as a destination for other economies).

But though the international system of the post-war period gives the advanced economies enormous global influence, its reputation and fundamental functioning ultimately depends on the responsibility of their stewards.

Since the financial crisis of 2008 revealed that they did not, and the extended and excessive dependency of the affluent world on a monetary policy-dependent policy mix has worsened its credibility.

#THE CHALLENGE TO THE PORT?

In that context, the unequal, discriminatory and ineffective roll-out of vaccines might hit the long-term viability of the system enormously. It obviously would be good for China. It has strongly challenged the legitimacy and the appeal of the western-dominated system, which it portrays as untrustworthy and asymmetrical in relation to developing countries, thanks to its expanding economic dominance and worldwide influence. 

However, because something cannot be replaced with nothing, the result was that some hybrid system evolved slowly but consistently. The system of postwar remains in place, but the profusion of arrangements that circumvent its core steadily undermines it's dominance.

These include new multilateral organizations (such as the Asian Infrastructure Investment and New Development Bank), new regional plans (in particular, Chinese Belt and Road Initiative) and new bilateral trade and investment agreements. These include new bilateral trade and investment agreements.

The general function of the global economy was weakened due to these changes, with major ramifications for everyone. More and more countries under pressure will experience a more bunkered attitude the more delayed the immunization in many sections of the developing globe.

The less stable the international system becomes, the less likely that synchronized growth will be required to improve the performance of any country. Advanced economies will also confront extra national security issues if the system trust continues to deteriorate. Confidence is a precious commodity: it is difficult to find, readily eroded and extremely difficult to recover.

The current international system is far from flawless, but better than any alternative, yet eminently reformable. Advanced economies must not compromise the global immunization effort by dragging their heels.

Author ៖ Samnang, Editor-in-Chief ៖ Sunnie, Editor-in-Chief / Producer ៖ Nicole

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