Economy

COVID-19: Viable vaccine will not halt spread of economic damage, warns UNCTAD

The economic setback would be felt long into the future, especially by the poorest and most vulnerable countries, the report added

 
By Madhumita Paul
Published: Friday 27 November 2020

A viable novel coronavirus disease (COVID-19) vaccine will not halt the spread of the economic damage stemming from the pandemic, a new report by United Nations Conference on Trade and Development (UNCTAD) has warned.

The economic setback would be felt long into the future, especially by the poorest and most vulnerable countries, the United Nations trade and development body added in the report published November 19.

The report titled Impact of the COVID-19 Pandemic on Trade and Development: Transitioning to a New Normal projected that the global economy would contract 4.3 per cent this year due to the pandemic. It warned the crisis could send an additional 130 million people into extreme poverty.

The pandemic is loading more costs onto developing countries while simultaneously reducing the availability of external finance, the report said. Developing countries did not only need debt relief, but direct liquidity support to give them budgetary spending power in the short term and a framework for sovereign debt restructuring in the long term, it added.

According to the report, the United Nations’ Sustainable Development Agenda 2030 could be derailed unless immediate policy actions are taken.

The report called for stepped-up international assistance, which would include offering debt relief to many poorer nations so they have the fiscal space needed to address the pandemic’s economic impacts on their populations.

UNCTAD has charted a roadmap for a more inclusive and better recovery, emphasising the need to reshape global production networks.

It also highlighted that global production networks must be more green, inclusive and sustainable because global production networks will play a critical role in producing and distributing the new vaccine.

“Such efforts must go hand in hand with the arrival of potential vaccines to the market, otherwise we risk reinforcing those inequalities that turned this health emergency into an economic crisis in the first place,” said UNCTAD secretary-general Mukhisa Kituyi.

As the number of cases continues to surge across the world, the World Health Organization (WHO) chief, Tedros Adhanom Ghebreyesus, called for solidarity in the rollout of future COVID-19 vaccines.

UN Secretary-General Antonio Guterres touted the pandemic as “the greatest crisis of our times”.

“We need global solidarity every step of the way. A vaccine must be global public good. Vaccines, tests and therapies are more than lifesavers. They are economy savers and society savers,” he said.

A comprehensive recovery package for building a stronger, fairer, more inclusive, and greener (and bluer) economy would require cooperation-oriented trade policy and effective competition policy and consumer protection policy.

Governments  should  adopt  or  encourage  the  adoption  of  appropriate  measures,  including  legal systems, safety regulations, national or international standards, voluntary standards and the  maintenance  of  safety  records  to  ensure  that  products  are  safe  for  either  intended  or  normally foreseeable use.

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