IMF's Kristalina Georgieva: ‘We must vaccinate the world’

International Monetary Fund chief calls for $50bn to inoculate global population

IMF managing director Kristalina Georgieva urged countries that have booked more vaccines than they need to distribute the surplus to nations that need them – and to do so quickly. AFP

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IMF managing director Kristalina Georgieva urged global policymakers to “vaccinate the world” as she spoke of a “dangerous divergence” between advanced and developing economies in the recovery from Covid-19.

Ms Georgieva said it would cost $50 billion to vaccinate 40 per cent of the world's population this year and 60 per cent next but that was possible only “if we all pull together” to secure the funding.

“That amount dwarfs the economic benefits of vaccination,” she told the Paris Peace Forum on Monday.

“It is so very straightforward that for economic and for ethical reasons we ought to vaccinate the world.”

Ms Georgieva urged advanced economies to “swiftly move” any surplus vaccines to parts of the world in desperate need, including Africa, Latin America, South Asia and the Middle East.

“If you have booked more vaccines that you need, move it now,” she said. “What is that we are calling for? One billion doses this year to be transmitted from advanced economies to developing countries.”

The IMF chief said the G7 must offer more doses than the one billion it pledged for poor countries at the June summit in Cornwall.

The G7 leaders pledged to supply the vaccines to poor countries – including 100 million from the UK – either directly or through the Covax scheme, which is co-led by the World Health Organisation, Gavi and the Coalition for Epidemic Preparedness Innovations.

However, Ms Georgieva said the pledge was “not enough” and the group of major economies “needs to act more forcefully”.

She urged Group of 20 nations that can “stretch and top-up financing to please do so”, with Ngozi Okonjo-Iweala, director general of the World Trade Organisation, also asking the G20, which meets this weekend in Italy, to “donate more doses right away”.

The WTO chief, who took on the role on March 1, said the recovery in trading conditions in Latin America, the Middle East and Africa was taking place at a much slower pace than the rest of the world.

“We think that this inequity of vaccines lies at the heart of it, which is why we suggested that we need to meet move really fast to close this gap,” she said.

Global trade is expected to increase by 8 per cent this year, the WTO said, helping to drive economic growth of 5.6 per cent, boosted by US President Joe Biden’s $1.9 trillion spending package. Trade growth of 4 per cent is expected in 2022.

While the value of global trade slumped by slightly more than 7 per cent last year, Ms Okonjo-Iweala said, the trade in medical supplies and equipment increased by 16 per cent with trade in PPE up by half.

To help solve the vaccination challenge, she said supply chains must work efficiently and more vaccines must be manufactured to meet demand.

Meanwhile, Ms Georgieva said strong growth in wealthy countries such as the US was "good news", however, developing countries were being held back by slow vaccination rates.

"That is danger for the coherence of growth and it is also a danger for global stability and security," she said.

The IMF chief said it was critical to accelerate action and improve coherence to ensure not only wealthy countries with “sufficient fiscal and monetary policy” surfaced from the pandemic with growth at levels “not seen in decades”.

“After what was a year of crisis like no other, we are now seeing recovery like no other,” she said.

With the majority of countries in the developing world falling behind on their vaccination programmes, Ms Georgieva said this would hold back their recoveries.

“As long as this pandemic continues to roam around with new mutations, they will be ricocheted back into the vaccinated world,” she said

The IMF is bullish on the US economic recovery, predicting earlier this month that growth will hit 7 per cent this year – much stronger than previously forecast and "the fastest pace in a generation”.

The IMF’s annual review of the US economy put growth at its fastest rate since 1984 and boosted the 2022 GDP forecast to 4.9 per cent, 1.4 percentage points higher than the April estimate.

However, to ensure developing countries have the same prospects for growth, Ms Georgieva called on world leaders to come together and “provide accelerated vaccinations”.

“It is a solvable problem,” she said.