As the U.S. and many other wealthy nations turn the corner in the fight against COVID-19, a troubling trend has emerged: high-income countries like ours have administered more than 80 percent of global vaccines, while low-income countries have received just 0.3 percent.
For our country, this is not only a moral issue — it’s also an issue that threatens Americans’ health and our economy. And as more and more developing countries turn to China for aid and vaccine funding, it’s also a question of if the Western world will step up.
Earlier this month, the Group of Seven (G7) nations took a major step, pledging to get one billion COVID-19 vaccine doses out to poorer nations. But there’s an important tool we’ll need to help get shots in arms all around the world: Special Drawing Rights, or SDRs.
SDRs are global reserve funds created by the International Monetary Fund (IMF) that can be used to help countries facing economic downturns, and they’re becoming critical to support COVID-19 response and recovery in lower-income countries.
At the G7 summit, world leaders agreed to a $650 billion allocation of SDRs, the largest issuance in history, to help countries where pandemic response needs are greatest and economic recovery has been slowest. SDRs emerged as a central focus of the summit, and rightly so: A recent Rockefeller Foundation study found that moves to bolster the IMF’s emergency reserves could provide the funding needed to vaccinate 70 percent of the population in lower- and middle-income countries by the end of 2022, at no added cost to rich countries.
The G7 also set a goal of reallocating $100 billion worth of SDRs held by wealthy countries to low-income countries, which French President Emmanuel MacronEmmanuel Jean-Michel MacronBiden falters in pledge to strengthen US alliances Australian prime minister: No regrets over submarine deal with US, UK France's Macron to speak to Biden about submarine deal MORE called an “important step for justice.”
But it isn’t enough. As IMF Chief Kristalina Georgieva has remarked: “On the $100 billion [for SDRs], is it enough? Let's be very clear, no it is not enough. We have a financial gap just to catch up with the impact of COVID for the continent of Africa of $285 billion. It is genuinely an all-hands-on-deck situation.” The global need for SDRs that she says needs to be met? $2.5 trillion.
South African President Cyril Ramaphosa has highlighted why more funding is so crucial: “We need to address the substantial financing gap for tests, treatments, critical supplies like oxygen and the health systems that enable testing, treatment and vaccination.” In other words, we can send a billion vaccines around the world, but it won’t make a difference if countries lack the liquidity to create the infrastructure needed to scale up vaccination programs.
That’s why if we want to truly address global health disparities, we need to expand our use of SDRs further.
There are two ways to do it — issue more SDRs or reallocate SDRs from wealthy countries back to the IMF — and they both require approval from Congress. The good news is that there's every reason why this should get bipartisan support. Boosting SDRs is not only the right and moral thing to do — it’s the smart thing to do.
Recently, over 40 members of Congress signed onto a letter to President BidenJoe BidenCapitol fencing starts coming down after 'Justice for J6' rally Senate parliamentarian nixes Democrats' immigration plan Biden pushes back at Democrats on taxes MORE supporting an additional issuance of SDRs, led by Reps. Pramila JayapalPramila JayapalManchin suggests pausing talks on .5 trillion package until 2022: report Democrats urge Biden to commute sentences of 4K people on home confinement Manchin keeps Washington guessing on what he wants MORE (D-Wash.), Tom MalinowskiThomas (Tom) MalinowskiThe Hill's Morning Report - Presented by Facebook - Biden to reboot COVID-19 plan House Ethics panel reviewing Rep. Malinowski's stock trades Overnight Health Care — US hits new vaccine milestone MORE (D-N.J.) and Raja KrishnamoorthiSubramanian (Raja) Raja KrishnamoorthiOvernight Health Care — FDA panel backs boosters for some, but not all White House to host global COVID-19 summit next week Biden under pressure to ratchet up vaccine aid MORE (D-Ill.). They wrote, “it is imperative that the United States act quickly and deploy every tool in our arsenal…The fate of our own health and safety in the United States is inextricably connected to the wellbeing and protection of the most vulnerable among us worldwide.”
If we fail to contain the spread of COVID-19 around the world, that affects our health — and the American economy. And as the world fails to adequately support vaccination programs in low-income countries, those countries are increasingly turning to China.
Continued economic and health crises in the developing world leave poor countries vulnerable to large-scale Chinese acquisitions, as well as lopsided terms of trade and investment with a dominant China. In contrast, SDRs safeguard U.S. influence worldwide.
An additional allocation of SDRs would restabilize the U.S.-backed international financial system while limiting Chinese influence and expansion. The direct benefit to China would be negligible, since China already has more than $3 trillion of foreign exchange reserves, the majority in dollars. While China represents 18 percent of the global population, China would receive only 6 percent of the allocation. Meanwhile, many countries that risk slipping into Beijing’s orbit would disproportionately benefit, including the bulk of the African continent.
Throughout the COVID-19 pandemic, we’ve seen global health disparities not only come into focus but become more severe. We’ve seen the pandemic’s health and economic impacts fall hardest on low-income communities and essential workers. The rich have gotten better care — or simply access to care — while the poor have suffered.
This must end — and it must end now. With SDRs, we can immediately reverse the trajectory we’re on, where COVID-19 is spreading faster than vaccine distribution, and we can ensure much greater equity in access to vaccines at the global level. We can step up and take care of one another.
Cecilia Muñoz is a senior advisor at New America and the former director of the Domestic Policy Council under President Obama. She is a contributor to the forthcoming “Immigration Matters,” from New Press.
This piece has been updated.