International Monetary Fund decries Covid 'vaccine nationalism' and urges wealthy countries to share stocks

Credit: AP

There are two types of countries in this world - those with Covid vaccines and those who have to wait.

On Tuesday, the International Monetary Fund (IMF) warned of a “dangerous divergence” in the economic fortunes of the “haves” and “have nots.”Advanced economies have, on the whole, been quick to place coronavirus vaccine orders, secure stocks and administer jabs.

They have been able to ramp up government borrowing and spending to protect households and businesses during lockdowns.

The rollout of the vaccine programmes in the United Kingdom and the United States have been extremely successful - almost half (46.5%) of the UK population and one-third (32.1%) of the US population has received at least one dose. 

The IMF believes both countries can look forward to a strong bounce back in their economic fortunes.

By contrast, programmes have barely got going in developing countries like Mali (0% of the population vaccinated), Pakistan (0.03%), Vietnam (0.05%), Trinidad and Tobago (0.07%) and Namibia (0.08%).

  • Joel Hills discusses IMF's forecast on UK economy post-Covid

The IMF says that poorer nations will suffer disproportionately because their governments have struggled both to secure vaccine supplies and to borrow money to support their economies.

Gita Gopinath, the IMF’s chief economist, argues that it’s now time for wealthier countries to share their shots.

  • Ms Gopinath condemns "vaccine nationalism"

“Countries can debate this as much as they want but we are seeing vaccine nationalism, explicitly and implicitly,” Ms Gopinath told ITV News. 

“We are seeing some countries who are way ahead in vaccinating the vast majority of their population, while even the most vulnerable in a whole bunch of countries haven’t gotten a single shot.

"That is what needs to be fixed.”Ms Gopinath says 95 million people have “entered the ranks of the extreme poor” in the last 12 months - the majority in India and Sub-Saharan African. 

She wants fairer access to vaccines immediately and argues that it is in the economic interests of wealthier countries to share.

Doing so, she argues, would minimise the risk of a new variant of the virus emerging in countries that are overwhelmed and would strengthen the global recovery, from which advanced economies would benefit.  

  • Listen to the ITV News coronavirus podcast:

“[Vaccine] production is ramping up," Gopinath said.

"If you look at what’s in the pipeline there is a large number of doses expected in the second quarter but the world should not take that as a given.

“Many countries right now have purchased many multiples of the doses they need and it’s a good time now to start to talk about how you are going to start reallocating excess vaccines.

"But you have to do that in an equitable manner and not just to your regional partners.”

The UK has ordered more than 400 million vaccine doses, more than three time the numbers required.

It has pledged to donate surplus stocks to poorer nations, but hasn’t said when it will start doing so. 

  • Ms Gopinath explains why the IMF predicts such strong growth for the UK

Meanwhile, the IMF has upgraded its assessment of the UK’s economic prospects.

It now predicts growth of 5.3% this year and 5.1% next - the strongest growth in 2022 of all of the major G7 countries.

The vigorous bounce back is partly down to the scale of the recession the UK experienced in 2020 - which was deeper than in many other countries. 

However, the IMF says the recovery will be powered by the success of the vaccine rollout, the lifting of restrictions and the stimulus announced by the chancellor in his Budget last month.

However, the IMF believes it will take until the second half of next year before the UK economy returns to its pre-crisis size.

It expects the French and German economies to recover sooner. On the face of it, this is surprising. 

The UK government has delivered a bigger fiscal boost than anywhere else in Europe and its vaccine rollout is far more widespread.

We face the prospect of restrictions lifting entirely by the end of June while continental Europe is beginning to experience its third wave of the virus. 

The University of Oxford said that no safety concerns have arisen from the trial itself. Credit: PA

Ms Gopinath expects the UK recovery will be held back by its dependence on tourism and by the ongoing damage Brexit has caused to trade between the UK and the EU.

“In the beginning of this year we certainly saw the Brexit disruption quite strongly, I’m mean a 30% drop in trade because of the disruption,” Gopinath said.

“There is still a lot that needs to be fixed and new trade deals need to be done. The hope is those will get done in the next few months.”Amid the chaos of the pandemic, the economic impact of Brexit has disappeared from view, but it is still there and continues to be felt.