Info Service on Health Issues (Oct20/14)
Extract from United Nations: Global trade to fall by 7% to 9% in 2020, says UNCTAD by Kanaga Raja (Geneva)
Published in SUNS #9216 dated 22 October 2020
The latest quarterly report of the UN Conference on Trade and Development (UNCTAD) drew attention to the COVID-19 medical supplies such as personal protective equipment (PPE), disinfectants, diagnostic kits, oxygen respirators and other related hospital equipment.
It said that international trade has played a substantial role in responding to the COVID-19 pandemic.
"Despite the very early stages of the pandemic, characterized by several nations imposing restrictive trade policies to safeguard potentially scarce medical supplies, international markets have contributed to meet the surge in overall demand for products necessary to combat the diffusion of COVID-19."
Between January and May of this year, exports of COVID-19 medical supplies (personal protective equipment, disinfectants, diagnostic kits, oxygen respirators and other related hospital equipment) from China, the European Union and the United States rose from about US$25 billion to US$45 billion per month.
On a year-on-year basis, the trade of these products has increased by an average of more than 50 per cent since April 2020.
"Nevertheless, the increase in supply of COVID-19 related products has been largely to the benefit of wealthier countries," said UNCTAD.
"There is substantial evidence that middle- and low-income countries have been largely priced out from access to COVID-19 related products," it added.
Despite efforts to facilitate access to COVID-19 supplies, trade statistics show that only a tiny fraction of the additional world production of COVID-19 related supplies have reached low-income countries.
Since the onset of the pandemic, each resident of high-income countries has benefited, on average, from an additional US$10 per month of imports of COVID-19 related products.
This number is much lower for middle-income countries at about US$1, and lower still for low-income countries - a mere US$0.10.
In other words, said UNCTAD, per capita imports of the medical goods essential to mitigate the COVID-19 pandemic have been about 100 times larger in high-income countries in comparison to low-income countries.
"While it should be expected that the increase of per capita imports of COVID-19 products would be larger for wealthier countries, the sheer difference is staggering," said UNCTAD.
The report also said that apart from income, one factor contributing to such a vast difference in the governmental response is the substantial revenue losses to government budgets due to the impact of the COVID-19 pandemic.
While the wealthiest countries have been able to mobilize resources so as to increase healthcare spending, many poor or highly indebted countries have found themselves with little budgetary space to do so.
"It is very possible that without additional funding sources, the pandemic will remain unchecked in many parts of the world with negative repercussions on the global economy, including international trade."
This also indicates that the COVID-19 pandemic may exacerbate pre-existing social and economic inequalities, UNCTAD cautioned.
A vaccine appears to be the most promising way to assuage the pandemic and revive the global economy, it said.
"Still, for any recovery to be truly global and inclusive, it is important for the vaccine to be affordable and widely available."
The ongoing initiatives to make vaccines available in developing countries may not be sufficient, said UNCTAD.
Indeed, in the case of vaccines, the difference in access between wealthy and poor countries could be even more drastic than those observed so far for COVID-19 medical supplies, it pointed out.
While at least some low-income countries have the capacity to locally manufacture some protective equipment, this may not be the case for vaccines as manufacturing and logistic capacities are generally weaker in poorer countries.
UNCTAD said that in the immediate future it remains essential for countries, the private sector and philanthropic sources to mobilize additional funding to fight the COVID-19 pandemic in developing countries and to support financial mechanisms, such as the global COVAX initiative, to provide safe and effective COVID-19 vaccines to poor countries.+