The first year of the Covid-19 pandemic was characterized by the stunning failure of many rich countries to mount an effective domestic response, allowing the coronavirus to exact a terrible toll on their citizens. The second year and beyond, in turn, has been marked by rich countries’ failure to adequately help their less privileged neighbors, instead allowing a chasm to open up between haves and have-nots in terms of access to vaccines, diagnostics, and treatments. This has sparked calls to reform the system for financing global health and improve international co-ordination mechanisms, but the proposals being advanced by world leaders still fall short of what is needed.
The inequality is jarring at the human level. By mid-autumn 2021, more than 65 percent of people in high-income countries had been fully vaccinated, but less than 4 percent of those in low-income countries had gotten even a single dose.1 More than a quarter of American senior citizens had already received a third booster shot when nine out of ten frontline healthcare workers in Africa were still not fully vaccinated.2 Every UK resident could request up to seven free Covid-19 tests by mail per day, while Senegal was still administering just seven a day for every 100,000 people.3
It is not just the vulnerable in poor countries who pay the price for this failure, though. The health and welfare of those in rich countries are also at risk so long as the virus is allowed to spread in far-flung corners of the world. The more people that are infected, the greater the chance that a pathogen will evolve to become more transmissible or deadly. We saw this happen when the more infectious Delta variant was first detected in India in December 2020 and by summer 2020 became the predominant strain around the world, leading to a new wave of deaths. The Omicron variant repeated the pattern, spreading at an even more alarming rate. There is also a steep economic cost. The International Monetary Fund estimates that if global inequity in the Covid-19 response is not overcome, the world will collectively suffer US$5.3 trillion in economic losses by 2026.4
Fighting Covid-19
Understanding how the world has come up short requires looking at what has been accomplished. On Jan. 30, 2020, the World Health Organization (WHO) sounded the alarm about the Covid-19 outbreak by declaring it a Public Health Emergency of International Concern (PHEIC), the highest formal designation that it is empowered to make. This obliged the WHO to compile temporary recommendations to member states as well as provide technical advice, but as it is not a funding agency or implementing organization, it could not back these up with direct action or resources.
A number of UN agencies and NGOs that work on individual global health issues instead began repurposing staff and funding to cobble together an international response. One week before the PHEIC was even declared, the Coalition for Epidemic Preparedness Innovations (CEPI) rolled out US$11 million in funding for three initiatives to develop a Covid-19 vaccine. Two days later, on Jan. 26, the Bill & Melinda Gates Foundation announced its first Covid-19 grants to the Africa CDC and several Chinese government agencies to scale up public health measures.5 In mid-February, UNICEF issued an urgent fundraising appeal to help it support global efforts to fight Covid-19, and in early March, the Global Fund to Fight AIDS, Tuberculosis and Malaria started allowing countries to reprogram funding from grants intended to combat the three long-standing epidemics to instead blunt the spread of the new coronavirus.6 As infections skyrocketed, however, shifting the focal point from Wuhan to Milan and then New York City, it quickly became clear that much more funding and co-ordination was needed.
When major humanitarian emergencies occur, the US president and other G-7 leaders often work together to rally countries to pledge financing and co-ordinate their responses. This was the case when Ebola spread through West Africa in 2014 and after numerous natural disasters. In 2020, however, Donald Trump’s administration was not inclined to prioritize international co-operation, nor to use its prerogative as the 2020 G-7 chair to drive joint action. The world faced a vacuum of leadership, plus there were no existing institutions with the mandate or capacity to finance and implement a truly global response.
To fill this breach, in April 2020, the WHO and the European Union, along with UN leaders, the Gates Foundation and leaders of several global health organizations launched a temporary and ad hoc coalition to co-ordinate and implement an international response. They gave their initiative an unwieldy name, the Access to Covid-19 Tools (ACT) Accelerator, and divided tasks among 10 global health organizations — including CEPI, the Gavi vaccine initiative, the Global Fund, UNICEF and Unitaid — that were assigned to four “pillars” focusing on diagnostics, therapeutics, vaccines and health system support.7 Of these, the vaccine pillar, which is better known as Covax, has received the greatest attention.
The ACT Accelerator organizations took the WHO’s Covid-19 Strategic Preparedness and Response Plan as the blueprint for their activities and institutionalized co-operation among themselves, initiating weekly meetings for the heads of each organization and seconding staff to support a small secretariat at WHO headquarters. They presented a united front in urging governments and major philanthropies to pledge contributions for ACT Accelerator programs, making an appeal for US$31.3 billion in June 2020, and then revising it to US$33 billion for the initial stage of activities through September 2021.8 While the ACT Accelerator focused public attention on the headline budget request, pledges were actually made directly to its constituent organizations, and each was responsible for conducting its own fundraising outreach to government donors.9
Government funding took time to start flowing, so, in the early months of the pandemic, a sizeable portion of the money for the global response actually came from private donations to a charitable fundraising initiative, the Covid-19 Solidarity Response Fund for WHO, which was led by the UN Foundation and the Swiss Philanthropy Foundation along with the WHO. This raised an eye-popping amount for a charitable effort, more than US$256 million. Only US$10 million of this ended up being officially classified as funding through the ACT Accelerator, and its other funds supported the work of the WHO, the Africa CDC, UNHCR programs in refugee camps, etc.10 Government pledges gradually picked up and, by the mid-March 2022, US$20.3 billion had been pledged for ACT Accelerator programming by more than 50 countries, along with the European Commission, dozens of private foundations and companies, and others.
Assessing the Global Response
The ACT Accelerator had its share of successes. For one, it was the first and only truly global Covid-19 initiative to get off the ground, which was no small feat, especially without active support at the beginning from many of the world’s most powerful countries, including the United States, China and Russia. Even though it fell far short of its initial goals, it managed to raise an unprecedented sum of money. Also, relying on existing organizations rather than trying to construct an entirely new institution on the fly allowed it to quickly take advantage of the networks and programming that its member organizations already had in place. For instance, UNICEF was already the world’s largest purchaser of vaccines, so it was well positioned to set up distribution programs for the Covid-19 vaccine. Similarly, the Global Fund was already distributing large amounts of PPE to healthcare workers in low- and middle-income countries (LMICs) while building up laboratory systems in Africa to conduct nucleic acid testing for HIV and tuberculosis, so it was natural for it to help countries to repurpose the same supply chains and equipment for Covid-19 testing and treatment.
This effort, however, also came up short in many important ways. Even though the ACT Accelerator mobilized a historic amount of money in its first 18 months, this covered little more than half of its budgeted needs. While a few countries, starting with Sweden, Germany and Norway, committed more than the “fair share” portion that the ACT Accelerator Facilitation Council estimated they should pay, other major economies, most notably China, India and Russia, contributed little or nothing. By the end of the ACT Accelerator’s first stage of operations, in September 2021, governments in Europe had pledged 69 percent of their fair share on average, and those in North America had committed 66 percent. But governments in East Asia only pledged a combined 20 percent of their fair share, with almost all of the funding coming from Japan and then South Korea.11
Also, there was a major imbalance in the earmarking of funds that were raised. Most ACT Accelerator pledges were designated for Covax, eventually covering practically all of the vaccine pillar’s budget for the period through September 2021. However, the ACT Accelerator only managed to raise one-fifth of the budget for the other three pillars. Apparently, many countries found it less sexy to support testing, treatment and initiatives such as equipping healthcare workers with PPE.
The slow speed of pledges also proved fatal, undermining the ambitious Covax plans. Covax focused on funding the development, procurement and delivery of vaccines, and the big innovation — and big gamble — at its heart was a plan for both rich and poor countries to purchase their vaccines through it. The designers of Covax understood that rich countries were likely to seek bilateral deals with a few vaccine makers to secure doses for their populations, but it was unclear which manufacturers might succeed in bringing an effective vaccine to market, so they hoped that many would also want the option to purchase other vaccines in the broad Covax portfolio, even just as insurance in case the one or two vaccine programs they were betting on did not pan out. Covax’s founders also created a second channel, the Covax Advance Market Commitment (AMC) window, to enable donors to cover the costs of vaccines for poor countries, hoping that the purchasing clout they could garner with commitments from rich countries to purchase vaccines for themselves as well as from the funds flowing through the AMC would put Covax in a position to shape the vaccine market. But governments and pharmaceutical companies behaved even more badly than expected, as rich countries competed with one another to go around Covax and sign advance purchase contracts for their own citizens, often pursuing multiple deals that could lock down three, four or five times the amounts needed for their populations. At the same time, donor countries dragged their feet in funding the Covax AMC window, often only stepping up to make pledges in the spring and summer of 2021, well after rich countries had already locked down much of the vaccine supply coming to market for the initial year. This pushed Covax to the end of the queue for deliveries and undermined its negotiating power with pharmaceutical companies, crushing hopes of an equitable rollout of the vaccines.
The situation was further complicated as leading countries, notably including China and the US, used bilateral channels to sell or donate vaccines. The US eventually started shifting its dose donations into the Covax framework, allowing for greater co-ordination to ensure that LMICs could receive doses in an orderly manner, but Covax’s delay in obtaining vaccines and all the bilateral side deals took a toll. This was made clear when the African Union stepped outside of the Covax framework to negotiate vaccine deals on its own, through the Africa Vaccine Acquisition Trust.
Lessons for the Next Pandemic
The Covid-19 response exposed serious gaps in the global health architecture and the system of development assistance. First, it made it clear that a global approach is needed to help countries with limited resources respond quickly and effectively to large-scale health emergencies.12 Relying on each country to respond on its own puts less fortunate ones in an untenable position, particularly when richer countries compete with them over a limited supply of drugs and equipment. This approach also needs to build on a firm institutional base. The ACT Accelerator was created because there was no existing vehicle through which to co-ordinate and fund a truly global response, but it was always intended as a temporary measure. The three major international commissions convened to assess the global Covid-19 response — the WHO’s Independent Panel for Pandemic Preparedness and Response (IPPPR), the G-20’s High Level Independent Panel (HLIP) and the G7’s Pandemic Preparedness Partnership — underscored the need for a more permanent institutional arrangement to provide large-scale “surge funding” to finance the response to future pandemics.13
Second, the crisis laid bare just how unprepared the world is and how little financing is available to support pandemic preparedness in poor countries (or for that matter, in rich countries). The IPPPR and the HLIP both recommended the creation of a new international pandemic preparedness financing facility with an annual budget of roughly US$10 billion.14 This would support the strengthening of disease surveillance systems, establishment of genomic sequencing facilities, stockpiling of PPE and other supplies, and additional measures to facilitate early detection and rapid responses. The US quickly embraced this proposal, and President Joe Biden announced a commitment of US$250 million in seed funding as well as plans to request another US$750 million from the US Congress for its initial year. While there has been some debate over whether the facility might be launched as a new, standalone institution, the US and others have made a strong case for it to be created as a financial intermediary fund housed at the World Bank but overseen by an independent panel.
Third, the Covid-19 experience has shown that stronger political leadership is needed at the global level to ensure that pandemic preparedness and response measures are decided upon and executed in a speedy manner and also that preparedness is sufficiently prioritized during “peacetime” when alarm over the latest crisis has waned. The IPPPR proposed the creation of a Global Health Threats Council consisting of heads of state and loosely affiliated with the United Nations in order to oversee the proposed pandemic preparedness facility, and the HLIP recommends the addition of a Global Health Threats Board of ministerial-level representatives situated underneath the Council in order to ensure hands-on engagement in the management of the pandemic preparedness facility. In creating new mechanisms like this to encourage political leadership, the key challenges will be to see that they can move nimbly, find a way to balance inclusiveness (i.e. ensuring that LMICs and vulnerable populations are represented) with the practical need to engage the most generous donors, and avoid a situation in which superpower rivalries stall needed action.
Fourth, the current pandemic has again proven that the institutional design of international organizations needs to be thought through carefully in order to ensure they are efficient and effective. The ACT Accelerator’s successes have come, in part, from its utilization of existing organizations, which enabled it to take advantage of their pre-existing programs to provide PPE and other healthcare supplies, operate large-scale vaccination programs and strengthen health systems in LMICs. There are already many global health organizations with overlapping replenishment cycles in which they compete for limited ODA funding, so adding a new institution that duplicates the capacity of existing ones would likely add to the confusion and competition. That makes it important to consider how new mechanisms can partner with and work through existing organizations rather than compete with them, and this thinking is already informing proposals that the new pandemic preparedness facility channel its funding through outside global health organizations, including Gavi, the Global Fund and the World Bank.
The recent track record of international organizations also demonstrates that it is critical to find ways to actively involve civil society organizations in their governance. Over the past two decades, the most successful global health organizations have been ones like the Global Fund and Gavi that departed from the UN-centric approach of being overseen by government representatives and instead were structured more as public-private partnerships with civil society organizations, private foundations and affected populations also represented on their boards to ensure that the voices of diverse groups help inform their direction and operations. This has made these organizations more effective by creating pressures for them to better calibrate their programs to meet the needs of those on the frontlines of health responses, while also building up a natural support base of proponents who advocate with government and private funders to more generously fund these organizations.
Moving Forward
The inequalities that have fed the Covid-19 crisis and the toll it has taken — more than 6 million dead and hundreds of millions of lives irrevocably changed — underscore the imperative to reform global health financing and help LMICs prepare for the next pandemic. But the cycle of panic and neglect that has characterized other recent crises, from SARS to Ebola, when the political will to pursue ambitious reforms quickly faded, hints that our window of opportunity for meaningful action is narrow.
More resilient health systems: One goal should be to redouble efforts to help LMICs become more resilient by improving their health systems. Countries with more robust health workforces, better primary healthcare and universal health coverage can detect and contain outbreaks faster before they spiral out of control. Attention needs to be paid to sustaining, and ideally expanding, the level of development assistance for health as well as keeping pressure on LMICs to allocate sufficient domestic funding for health in their national budgets and providing steady financing for the range of global health organizations that directly and indirectly help LMICs strengthen their health systems.
Pandemic preparedness facility: Steps are also needed to see that the world is better prepared for the next pandemic, and poorer countries need help to do this. There is a strong push to make the proposed pandemic preparedness facility a reality, structuring it as an FIF at the World Bank. But a number of steps are needed for success. Donor governments are dragging their feet as complacency sets in, so sustained pressure is needed to ensure that it gets sufficient financial resources, in line with proposals for a US$10 billion annual budget. This amount is ambitious and only slightly less than the regular annual budgets of the WHO, Gavi, and the Global Fund combined, but it pales in comparison to the economic damage from a pandemic. The governance of this new fund is also crucial. Even if it is housed at the World Bank, it will be important that it is managed independently in order to avoid inadvertently setting up the World Bank to compete with existing global health organizations, which have deeper experience with complex health issues, do a better job of engaging with local stakeholders outside of central governments, and have stronger ties with health ministries and other key institutions (in contrast with the World Bank’s traditional orientation towards finance ministries). The new fund’s operations need to be carefully considered, also. The facility is likely to channel funds through other global health organizations rather than implement programs directly, but it will also be crucial to avoid creating a bureaucratic maze by layering World Bank funding regulations on top of the new fund’s requirements and those of the existing global health organizations through which it will operate. At the same time, care should be taken to ensure that the funding it channels through other global health organizations is stable and generous enough to avoid forcing those organizations to divert too much staff time and leadership attention away from their core missions.
Arrange surge funding for LMIC pandemic responses: In addition to building resilience and strengthening preparedness, it is also crucial to make institutional arrangements for rapid surge funding when a full-fledged pandemic response is needed. One option could be to make the ACT Accelerator permanent, but there is little appetite for this, even among the ACT Accelerator’s constituent organizations. The IPPPR recommended that the new pandemic preparedness facility pivot to providing surge funding to support responses during emergencies, but this proposal has not gained traction. Meanwhile, the HLIP suggested that the World Bank, IMF and regional development banks provide surge funding by using large-scale concessional lending when a pandemic strikes. However, the reluctance of many LMICs to take on more debt may slow or even deter them from accessing these funds. Plus, poor countries would be right to question why they should take on debt to prevent pandemics from growing to the point that they threaten rich countries.
Unsurprisingly, this is the area where there has been the least progress. A large amount, some estimate US$50 billion to US$100 billion,15 would probably be needed as surge funding for an effective pandemic response, and multilateral development banks and the IMF are likely the only entities that can mobilize these amounts. But we need a facility that can distribute grants rather than loans and that can do so in alignment with the WHO’s technical guidance, rather than operate in competition with it.
The Covid-19 pandemic reminds us that the fates of rich and poor countries are intertwined and also starkly unequal. It is clear that major reform is needed on global health financing, especially for LMICs, and worthy proposals are moving forward. Until the lessons of Covid-19 are fully taken to heart, however, and until the challenge of providing surge funding is worked out, the world will still not be ready for the next pandemic.
Notes
1 Our World in Data website, Nov. 1, 2021, ourworldindata.org
2 Data on US booster shots from the US Centers for Disease Control and Prevention’s Covid Data Tracker, covid.cdc.gov/covid-data-tracker as of Nov. 1, 2021. Data on African healthcare workers from the World Health Organization, www.who.int/publications/m/item/covid-19-virtual-press-conference-transcript—21-october-2021
3 Senegal data as of Oct. 28, 2021, from Our World in Data website, ourworldindata.org/coronavirus-testing
4 World Economic Outlook: Recovery During a Pandemic — Health Concerns, Supply Disruptions, and Price Pressures, International Monetary Fund, October 2021, p. xiv.
5 www.gatesfoundation.org/ideas/media-center/press-releases/2020/01/gates-foundation-commits-10-million-to-global-response-to-2019-ncov
6 “UNICEF appeals for US$42.3 million to support the global Covid-19 outbreak response,” UNICEF, Feb. 17, 2020, www.unicef.org/press-releases/unicef-appeals-us423-million-support-global-covid-19-outbreak-response; and “Global Fund Issues New Guidance in Response to Covid-19,” Global Fund to Fight AIDS, Tuberculosis and Malaria, March 4, 2020, www.theglobalfund.org/en/news/2020-03-04-global-fund-issues-new-guidance-in-response-to-covid-19
7 The 10 organizations were the Bill & Melinda Gates Foundation, CEPI, FIND, Gavi, The Global Fund, Unitaid, the Wellcome Trust, the WHO and the World Bank, with the Pan American Health Organization (PAHO), which serves as the WHO’s regional office for the Americas, joining later as a delivery partner.
8 In September 2020, the ACT Accelerator revised its budget estimates up to US$38 billion, but a portion of this was later counted as offset by US$4.9 billion in savings from price reductions, etc., leading the final estimate to be that US$33.1 billion in funds needed to be raised to meet projected needs for April 2020 to September 2021. See ACT Accelerator Prioritized Strategy & Budget for 2021, World Health Organization, April 12, 2021.
9 From spring 2021, major donor countries were divided up, with different ACT Accelerator organizations assigned to take the lead in co-ordinating the “ask” to each government. For instance, Gavi was considered the lead for the US, while the Global Fund was assigned as lead for Japan. In practice, much of the fundraising was still carried out individually by each organization, just with some more co-ordination and de-conflicting than before on the country level.
10 It was common for the portions of some Covid-19 pledges that aligned with ACT Accelerator prevention, treatment and vaccination efforts to be counted as ACT Accelerator contributions, while portions of the same pledge allocated for less direct purposes did not qualify. For instance, in 2020 the US made a US$3.5 billion pledge to support the Covid-19 activities of the Global Fund, but only US$2.7 billion of that was counted as an ACT Accelerator contribution; the remaining US$800 million, which was intended for more indirect efforts such as ameliorating the impact of the pandemic on AIDS programs or tuberculosis initiatives, was not counted.
11 Figures calculated by author based on the “ACT-Accelerator Commitment Tracker” prepared by the ACT Accelerator on Oct. 15, 2021.
12 It is also worth noting that the approach taken for the ACT Accelerator and discussions around a pandemic preparedness facility have reinforced consensus that progressive approaches are needed to fund international measures to counter pandemics, with rich countries paying more than poor. Containing pandemics enhances health security in rich countries as well as in poor ones, so there is an argument that pandemic financing should come from non-ODA budgets so as not to rob ODA recipients of support for other health issues, education, food security, and other important areas. This is particularly compelling for preparedness financing — especially the proposed US$10 billion per year pandemic preparedness facility — that in practice will protect citizens of ODA donor countries as much as those in recipient countries.
13 Covid-19: Make it the Last Pandemic, Independent Panel for Pandemic Preparedness and Response, May 2020, theindependentpanel.org/mainreport; 100 Days Mission to Respond to Future Pandemic Threats — A Report to the G7 by the Pandemic Preparedness Partnership, Pandemic Preparedness Partnership, June 2021, www.gov.uk/government/publications/100-days-mission-to-respond-to-future-pandemic-threats; and A Global Deal for Our Pandemic Age, G-20 High Level Independent Panel on Financing the Global Commons for Pandemic Preparedness and Response, June 2021, pandemic-financing.org/report/foreword/
14 The IPPPR called for the establishment of an “International Pandemic Financing Facility” to which donors would commit US$5 billion to US$10 billion annually for 10 to 15 years, while the HLIP calculated that an additional US$15 billon is needed annually over the next five years to improve preparedness and proposed creating a “Global Health Threats Fund” with a budget of US$10 billion per year.
15 Estimate from Covid-19: Make it the Last Pandemic, IPPPR, p. 57.
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