The IMF expressed its concern that the world is facing a two-track pandemic that is causing a two-track economic recovery with negative consequences for everybody in a recent statement
Gerry Rice, IMF’s communications director, said that the gap in access to vaccines between rich countries and poor countries is at the heart of this problem. He also stressed that the G7 leaders meeting last month needed to build on the progress made two months ago at the G7 finance ministers meeting, where they discussed the urgent priority of responding to the pandemic and in particular supporting emerging and developing countries in terms of their access to vaccinations.
G7 counties have a large role to play in restarting the global economy.
“IMF staff have put forward a very concrete proposal for a coordinated strategy to essentially end the pandemic in 2022. We put out the very specific measures that we think are required in terms of vaccination. 40 percent of the population in every country to be vaccinated by the end of 2021. 60 percent of the population in every country to be vaccinated by the end by the middle of 2022. We have put a financing number behind that, a price tag if you like, of $50 billion. We have broken down how we think that can be provided. The bulk of that, the vast majority of that should come in grant form for the most vulnerable countries. We’ve talked about the massive economic potential economic return on the $50 billion somewhere in the region of $9 trillion by 2025.” Said Rice
On India, Rice said that the Indian economy is important to the global economy due to its large share in global and regional GDP. And therefore, India’s growth and economic outlook has broader implications, with spillovers working primarily through trade linkages and global supply chains, which are particularly strong with South Asia and that region.
Rice also announced that the IMF welcomes the Indian government’s announcement to facilitate access to vaccinations and to provide additional support to minimize the social cost of the pandemic.
“The IMF welcomes the Indian government’s announcement to facilitate access to vaccinations and to provide additional support to minimize the social cost of the pandemic and to relieve the human, the very human costs of the pandemic. We strongly welcome the government’s announcement on that point. On the Indian economy, the second wave, which you mentioned, and associated containment measures suggest a sharp fall in economic activity and we will be revising India’s growth forecast next month in the update to the World Economic Outlook, that’s coming up shortly,” added Rice.