2023 will be a crucial year in determining whether there is political will to learn the lessons from the COVID pandemic and build a resilient health system.
With more than 15 million deaths from COVID so far, added to the growing impact of heart disease and cancer in low- and middle-income countries (LMICs), it is clear that we need new funding to ensure health systems deliver properly Mechanisms are needed – fit for purpose – which cannot be created by Official Development Assistance (ODA) and philanthropy.
The Financial Intermediary Fund for Epidemic Prevention, Preparedness and Response (PPR) was created earlier this year, following major efforts by the Italian and Indonesian Presidencies of the G20. The fund, which has reached $1.5 billion, is only a fraction of the estimated $10.5 billion needed each year to protect the world from the next pandemic.
[PPR] The fund, which has reached $1.5 billion, is a fraction of the estimated $10.5 billion needed each year to protect the world from the next pandemic.
For major funding created over the last 20 years to tackle specific diseases, the replenishment model has been disappointing.
In addition, a result of vaccines, therapeutics and diagnostics (VTD) nationalism during the COVID pandemic, there is a renewed determination among many countries to challenge the traditional donor-recipient international health structure.
Some G20 and G7 countries are still moving towards PPR from the old ‘donor-beneficiary’ approach, which fails to recognize health system strengthening as an important common good, and the capacity of recipient governments to respond But there is a desire for more access and control. an immediate health crisis.
Some G20 and G7 countries are still approaching PPR from the old ‘donor-beneficiary’ approach, which fails to recognize health system strengthening as an important common good.
The Japan G7, the Indian G20 Presidency and the UN have all put universal health coverage (UHC) firmly on the agenda for 2023.
While heads of government recognize the political importance of UHC, improved PPR and steps to reverse climate change, the level of national indebtedness due to the COVID crisis means that many countries have an impossible choice: operate by IMF conditional rules , repaying its sovereign debt, while trying to find a budget to address the threats to health and climate change.
In October, the International Monetary Fund (IMF) launched the new Resilience and Sustainable Trust, designed to support LMICs in meeting their immediate challenges on health and climate. This is a welcome initiative, however, as it currently operates, funding requires countries to meet the IMF’s standard terms and conditions, which typically require fiscal consolidation. It should be urgently revised by the IMF shareholders otherwise many countries will be unable to take advantage of its potential.
As donor models are unable to meet the fundamental challenges posed by building strong health systems and a resilient nationwide UHC, 2023 should be the year where countries are given the tools and financial space to develop year after year, their own domestic health system.
2023 should be the year where countries are given the tools and financial space to develop, year after year, their own domestic health systems.
There are countries that already have the fiscal space to increase health spending. In those cases, the international community, including multilateral development banks, should work with those governments to build evidence of the significant returns that their countries can achieve economically and socially by investing an additional one or two percent of GDP in their health systems. Will do
In India, a 1 percent increase in GDP being invested in strengthening the health system represents about $30 billion per year.
In India, a 1 percent increase in GDP being invested in strengthening the health system represents about $30 billion per year.
It takes political courage to do so, but it is a proven electoral winner when leaders commit to increasing domestic investment in public health. We look forward to working with governments in the G20 HDP to develop a metrics and tool kit that will demonstrate the value of increased investment in public health, based on models already deployed in G20 countries.
Of course there are countries that currently do not have the fiscal space to increase their investment in public health – many of these countries are focused entirely on managing the burden of repaying their sovereign debt. The COVID pandemic has further deepened this debt crisis for many countries around the world.
On the one hand, the G20 and the World Bank are promoting new FIFs for the PPR and on the other the IMF adheres to its conservatism, resulting in either stagnant or cutting investment in vital public services for 85 percent of the world’s population.
At the peak of the pandemic in 2020, LMICs serviced nearly $110 billion in debt, yet only $23 billion was supported by the ACT Accelerator in 2021-22.
Where countries are developing flexible plans for investing in PPRs, international institutions should assist those countries in developing domestic fiscal structures.
While countries are developing flexible plans for investing in PPRs, international institutions should help those countries develop a domestic financial framework that helps them move away from long-term dependence on the traditional donor-recipient model.
These countries need active support to modify their financial systems to increase investment in health – where a government is committed to this roadmap, the IMF should urgently develop a new model that punishes this domestic investment strategy. Reward instead of doing.
Some political leaders are already looking at new ways to build up that critical fiscal space in their economies. Barbados Prime Minister Mia Motley has developed a ‘pandemic clause’ in the country’s sovereign bond, which suspends debt-payments where the WHO formally declares a pandemic in the region.
The G20 and G7 should urge the IMF to encourage and work with leaders who are developing responsible fiscal and public investment initiatives that should not negatively impact a country’s credit rating and reward initiatives , such as the one pioneered by the successful debt-to-health swap. Global Fund or the recent Belize debt-for-nature swap.
With 60 percent of LMIC loans at risk of default and many emerging markets headed for recession, IMF shareholders should give the IMF Managing Director a clear mandate to create a new model that will encourage governments to invest in their health systems and Rewards for tackling climate change.
The COVID pandemic and the growing threat of antimicrobial resistance, heart disease and cancer require no less than the G7 and G20. Let us give vulnerable countries and their leaders the encouragement and tools to develop sustainable domestic solutions that can be a major step toward providing universal health coverage and proper pandemic preparedness.