The COVID-19 Crisis Is A Signal – Need To ‘Reset’ Global Health Financing
The 2020 G20 Riyadh summit, November 2020.

We are kicking off our expanded new series of opinion pieces, with Ilona Kickbusch’s reflections on last week’s G-20 and the mission of COVID vaccine distribution – what she describes as the most “defining global challenge” of 2021.  We invite contributions from health policy leaders, influencers and practitioners who wish to speak out on issues of concern – from wherever you may be in the world.   

In his global “wake up call” UN Secretary General, Antonio Guterres called on the global community to move from international chaos to the construction of an international global community that is capable of meeting and solving tomorrow’s challenges.

It was clear early on in 2020 that the Group of 20 most industrialized nations (G20) could not contribute much to resolve the present pandemic challenge – let alone the future – given the decision of the US president to disregard the pandemic, fight the World Health Organization (WHO) and to obstruct multilateral solutions.  It was even clearer last weekend that the G20 has not helped move this agenda forward.

COVID-19 is global, but the response to this collective global threat is still largely national. Its global dimension is still dependent on contributions in the form of development aid (ODA) and fundraising efforts of various types. This is also insufficient. Global health financing needs a full reset.

Instead, the rhetoric of global health in the speeches by global leaders has included regular mention of global goods and abounded with reference to equitable access to vaccines. “We will spare no efforts” said the G20 declaration at the conclusion of last weekend’s leaders summit, “we recognize the role of extensive vaccination as a global public good.” But the G20 has not stepped up to the plate to enable the ambitious goal to distribute 2 billion doses of COVID-19 vaccines before the end of 2021.

COVID-19 Vaccines is Test Case – But No Signal In Right Direction

The paradigmatic test case of common goods for health will be the equitable and fair access to a COVID-19 vaccine; this may be the defining global challenge of 2021. The G20 did not face up to a serious discussion on how to define and finance common goods. For example, recent estimates call for about US$ 26 billion a year of investment in common goods for health over the next five years, a manageable amount at just 0.32 % of total global spending on health.

Ilona Kickbusch, Founding Director of the Graduate Institute’s Global Health Programme in Geneva.

The G20 is not a pledging forum but a signal in the right direction might have helped. The European Commission called for US$ 4.5 billion at the G20 meeting to be invested by the end of 2020 in the WHO co-sponsored ACT Accelerator – a new global collaboration for procurement and delivery of COVID-19 tests, treatments, and vaccines everywhere. Germany – which holds the EU Council Presidency – had already contributed more than 500 million (US$ 592.65 million) to this effort.

So if each G20 member had committed to paying only US$250 million (in cash or kind), the approximately $US5 billion would be available. They have not. Instead a small group of rich countries representing 13% of the world’s population has bought up more than half of the future supply of leading COVID-19 vaccines.  In response, India and South Africa (members of G20) have sent a proposal to the WTO asking “that it allow countries to suspend the protection of certain kinds of intellectual property related to the prevention, containment and treatment of COVID-19.”

But much more serious than the lack of easily affordable action on the present crisis is the lack of foresight in relation to the future.

During the global financial crisis in 2008, the structural problems that contributed to the crisis were addressed, leading to changes in the financial regulatory architecture at national and regional level.

In the same way the G20 should have used the pandemic to address the major structural financing deficits of the global order – especially in relation to financing global common goods for health. Economic losses from the pandemic are currently estimated to exceed 4.9%–7.6% of global GDP (US$4–US$ 6 trillion), an amount that is 20 to 30 times greater than the estimated cost of investing in epidemic preparedness. COVID-19 has resulted in the deepest recession in decades as the International Monetary Fund and the OECD have calculated – it will probably have 4-fold the impact of the 2008 financial crisis.

No Global Revenue Raising Mechanism For Global Goods – Leaves Health Leaders Fundraising With Music Industry 

The G20 finance ministers should have addressed the fact that after 75 years there is still no reliable mechanism at a global level to raise revenues for global functions produced by the United Nations system. Yet even in the face of the largest pandemic in 100 years there is no political will to address the financing of global common goods for health – except to embark on yet another round of fundraising, one fancier than the next.

This political neglect has left key institutions like the WHO severely underfinanced. As millions die of COVID-19, it must create a new foundation and reach out to the global music industry to engage in fundraising for vaccine development and distribution as well as for the pandemic response in low- and middle-income countries.

This does not bode well for a future where the world will not only have to deal with pandemics, but also with antimicrobial resistance and the impacts of carbon emissions on air pollution and climate change.  Even generous countries – like the United Kingdom (who will preside over the G7 next year) are pulling back on their ODA commitments and have announced a cut to the UK’s foreign aid budget, which will be reduced from 2021 from 0.7% of gross national income to 0.5%, “saving” approximately £4 billion.

At the G20 it was obvious that the US would stall any move in the direction of a proposal that has even a whiff of WHO involvement linked to it –  outgoing President Donald Trump preferred to play golf rather than attend much of the conference proceedings.

In contrast the European Union has been particularly active in pushing funding for the COVAX facility, the global risk-sharing mechanism for pooled procurement and equitable distribution of possible COVID-19 vaccines. This must be recognized. But it too has not yet pushed for a longer-term blueprint for new financing mechanisms for global health.

Whether it’s a Digital Tax or Financial Transactions Tax Or Other Means – Paradigm Shift Still Needed 

A collective global problem typically requires a common response.  As outlined in a recent paper, this requires a paradigm change that would transform global health funding.

Rather than engage in declarations full of nice words, the joint meetings of the Health and Finance Ministers of the G20 should devise a financing framework that ensures a sustained source of revenue for global common goods for health. Possibly through a global or multinational taxation system or mix of national, global and regional taxation. A digital tax is frequently mentioned in this regard as well as taxing financial transactions. In the meantime, coordinated institutional mechanisms like COVAX should be supported to pool resources for common goods – such as vaccines – that are desperately needed.

Raising some US$ 25 billion a year for pandemic preparedness in a world whose GDP exceeds US$ 75 trillion would require a very minimal, and thus almost painless, level of taxation, making this a particularly feasible option.

But without political will it cannot be done. Not only must the heads of government come together and address this issue – in 2020 in both the G7 (chaired by UK) and G20 (chaired by Italy) – but also the many interest groups in global health covering a wide span of agendas and diseases must come together to address this larger issue of a new financing regime for common goods for health. The system that is build on ODA and philanthropy is broken and the sooner we address this issue the better. Because with a new financing paradigm the world will be more equitable and we will all be safer.


Professor Ilona Kickbusch is the Founding Director of the Global Health Programme at the Graduate Institute of International and Development Studies in Geneva. She is a member of the Global Preparedness Monitoring Board and the WHO High-Level Independent Commission on NCDs and co-chair of Universal Health Coverage 2030. She has been involved in German G7 and G20 health-related activities, and the development of the German global health strategy.

Image Credits: G20, European Health Forum Gastein.

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