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Despite the success of the global economy in overcoming most of the consequences of the economic shock caused by the Covid-19 pandemic, the necessity requires continuing international efforts to eradicate the negative effects of the pandemic and its recurring variants. Hence, it is important to help poor countries to obtain the needed inoculation, not only for humanitarian reasons, but also due to the facts that vaccines provide public goods for all.
The existence of Public Goods is considered as one form of market failure in allocating resources optimally, as the market in this case produces lesser quantities than it should because private firms are reluctant to produce certain goods and services despite their importance to society, due to the divergence between private and public costs.
Public Goods are characterized by two basic features; the first is non-rivalry in consumption, in the sense that one person’s consumption does not reduce the consumption of others, and the second characteristic is non-exclusion, meaning that once a good is available, no one cannot be prevented from obtaining it. Hence, the necessary vaccines to combat the Covid-19 pandemic would be considered an “International” Public Goods, as achieving a level of health protection on a large scale constitutes benefits to all, while the lack of vaccination constitutes a health disaster and a wide-ranging economic harm.
The Coronavirus pandemic started, as widely reported, from the Chinese city of Wuhan in December 2019, and spread quickly to all continents, which created negative impacts on vital sectors of the global economy, including the collapse in demand for oil and to the point that the prices for oil contracts in the United States turned “negative” in April 2020. After two years of this severe human experience, the pandemic is still threatening the health of human society due to its ability to evolve, as the experiences of India and five African countries recently have demonstrated. These variants pose continuous and significant challenges to the public health security of impoverish countries, which are known to have a fragile health system, and are ill-equipped to deal with this kind of risks.
It is worth noting that at a time when citizens of wealthy countries received three level of anti-virus doses, the absolute majority of citizens of Impoverish countries are hardly able to obtain a single dose.?! Recent reports on the matter have shown that approximately 70% of the vaccine doses were allocated to the citizens of the fifty wealthiest countries in the world, while the citizens of the fifty poorest countries got merely 1%.
There is no doubt that failure to provide vaccines to the citizens of impoverish countries may have catastrophic health consequences and tremendous costs for the global economy and international trade, including negative repercussions on the economies of wealthy countries as well. Developing countries are not geographically isolated from the rest of the world, and therefore the outbreak of epidemics in these countries will have far reaching harm to international tourism, travel, transportation and trade. A recent study by the International Chamber of Commerce showed that the financial losses due to the fact that the citizens of poor countries are not getting the vaccine exceeds $200 billion dollars, and these costs are higher than the costs of manufacturing and distributing vaccines internationally, even if the advanced economies succeed in inoculating all of their citizens!
It is expected that vaccines will not eliminate pandemics or prevent their development, but they are certainly effective in curbing them, and its ability to limit their spread, and reduce human and economic losses. What is worrying is that the impact of the Coronavirus pandemic may last for a relatively long time due to the difficulties associated with predicting its behavior and tracing its variants. This requires a high degree of coordination between international organizations and national health authorities, as well as preparing means of control and treatment, and strengthening collective immunity to limit the future spread of such costly pandemic, in terms of health and money.
It is recognized that the Coved-19 pandemic constituted a humanitarian and economic crisis, resulted in the death of millions of people, the disruption of international transportation system, and the sharp increase in prices of essential commodities such as; food, minerals and energy due to the disruption of supply chains, and bottlenecks facing global commerce and shipping operations, which resulted into inflation rates that reached 6% in some countries. These consequences were accompanied by the monetary authorities’ reluctance to raise the existing low interest rates due to the difficulty of anticipating the beginning of economic recovery, despite the threats of inflationary pressures due to the improvement in global demand for goods and services.
The difficult experience of the past months demonstrated the ability of the international community in reducing the health risks of the pandemic, and controlling the most serious economic crisis the world has witnessed since the Great Depression. Also, this experience has shown the success of national economic institutions in terms of its willingness to deal seriously with the pandemic by adopting fiscal stimulus policies, which provides urgent financial aid to ensure the sustainability of supply chains, and the flow of medical devices and materials. Therefore, it can be said that these international efforts have dealt with the pandemic as a health and economic disaster that transcends national boundaries, which highlights its ability to provide international public goods, when it so desires.
We need to point out that each country has its own uniqueness, ideology and capabilities that are reflected in the extent of its support for international efforts. Some of these countries have adopted the free-market system and while others adopted central planning regimes, whether for ideological or economic-development reasons, which in practice affect the extent of their commitment to international coordination. Therefore, the success of these efforts in supporting the health of the international economy and achieving development goals in various regions of the world depends on the conviction that there are common benefits.
This trend is dependent on accepting the concept of “international” public goods, which encourages countries cooperation to correct market failure at the international level, and also benefiting from quasi-governmental bodies and non-governmental organizations in these countries. In short, we can say that the Covid-19 pandemic has provided resounding lessons on the importance of international cooperation for the goods for all, which would have a positive role on the world community’s approach in dealing with future economic and health challenges.