Rich countries must open the way to cheaper mass-produced COVID-19 vaccines to protect every person in the world and avert a $9 trillion “worst case” global economic catastrophe, Oxfam has warned.
Oxfam analysis of recent International Chamber of Commerce figures – that highlighted the flow-on economic impacts of trading partners not having the same level of vaccine coverage – reveals that the failure to vaccinate the world quickly enough could cost each Australian $1348 this year.
Tackling the chronic global scarcity of vaccines, which is now sparking trade disputes between and economic shocks among countries, will feature at the World Bank and International Monetary Fund’s (IMF) Spring Meetings April 5-11.
The current approach to the global production and distribution of COVID-19 vaccines is falling far short of what is needed. According to Oxfam, urgent action is needed as COVID-19 continues to spike, mutate and kill whilst continuing to wreak economic havoc.
Lyn Morgain, Chief Executive of Oxfam Australia, which is part of the People’s Vaccine Alliance, said:
“Rich countries are defending the interests of the pharmaceutical sector over their citizens, other businesses, and their economies as a whole. It is a bizarre act of financial and economic self-harm. They are condemning everyone to suffer the consequences.”
Oxfam, with other members of the People’s Vaccine Alliance, is calling for an end to extreme vaccine inequality which is seeing rich nations vaccinate one person a second whilst many developing nations have yet to administer a single dose. The Alliance is calling for US President Joe Biden and other leaders of wealthy nations, including Scott Morrison, to show immediate support for the lifting of pharmaceutical monopolies and intellectual property rules to enable scale up in global vaccination.
The International Chamber of Commerce estimates that vaccine inequality at today’s scale could cost the world around $9.2 trillion in economic losses, in the worst-case scenario, with rich countries suffering half of that blow. Drawing on the findings of this study, Oxfam calculates that these losses are equivalent to:
- In Australia, up to $1348 per person in household spending this year.
- The United States could lose up to $2,700 per person in household spending in 2021, which is $1,300 more than the recent stimulus cheque that each received from President Biden’s administration. Overall, the US could lose as much as $1.3 trillion in GDP as its share of the cost of vaccine inequality.
- The UK could face up to a $1,380 loss in spending for every person. Similarly, a $1,239 loss in 2021 per person in France, roughly equivalent to a monthly rent bill.
Per capita losses in household spending in Japan and Italy in 2021 could amount to around $1,451 and $1,495 respectively.
Yet these same rich countries are among those now opposing moves by India and South Africa at the World Trade Organization (WTO) to break open the monopolies of big pharmaceutical companies, a move that would help other manufacturers to mass-produce more and cheaper vaccines.
“The US, UK, Germany, France, Japan and Italy together could lose as much as $2.3 trillion in GDP this year unless they stop fighting on behalf of a handful of big drug companies to retain the intellectual property of the vaccine —despite this status quo plainly failing both them and everyone else,” said Ms Morgain. “It beggars belief.”
Vaccine inequality is hitting low- and middle-income countries even harder:
- India could lose as much $786 billion, or over 27 percent, of its GDP due to global vaccine inequities.
- South Africa could see 24 percent wiped off its GDP, losing the equivalent of nearly $874 per person in household expenditure in 2021.
- The Philippines could be stripped of up to 18 percent of its GDP this year due to vaccine inequity, equivalent to around $450 per person in household spending.
“This is a stark reminder that vaccine inequality has a real economic impact on us all, even as a solution stares our leaders in the face. The richest people can cope better with this cost but every person, in every country in the world, is being expected to pay and struggle —the poorest people most of all,” Ms Morgain said.
“A People’s Vaccine is possible if WTO members waive these companies’ intellectual property, as India, South Africa, and nearly 100 other countries are demanding, and pharmaceutical companies do the right thing and share their vaccine recipe through the WHO’s Coronavirus Technology Access Pool (C-Tap).
“Countries from around the world, including the richest G20, are meeting this week to discuss the global economic and health crisis, which makes this a perfect moment for a breakthrough.”