A massive increase in international aid is needed now to help the poorest countries face the health, social and economic impacts of the coronavirus. Oxfam estimates rich countries’ fair share of aid in response to the crisis would be close to $300 billion. This is less than the combined wealth of the world’s three richest men. However, OECD figures revealed yesterday show that rich governments increased aid only slightly in 2019, leaving it far below the levels needed to face the current pandemic and its impact.
Forty million deaths. Half a billion people pushed into poverty. This could be the disastrous toll of the coronavirus unless governments take immediate and dramatic action. No-one is immune to the virus, but the crisis will undeniably hit the poorest hardest, further entrenching extreme levels of inequality. While the virus has been overwhelming some of the best healthcare systems, the challenges in many poor countries are even greater.
These terrifying prospects are largely preventable, if we act now.
Rich nations must make available the resources needed by developing nations and their citizens to stop the pandemic, avert humanitarian disaster and prevent economic collapse.
In Oxfam’s report “Dignity not Destitution”, we argue that governments and international institutions need to take four actions to pay for this: immediate debt cancellation, the creation of new international reserves by the IMF, the adoption of emergency progressive taxes and a massive injection of international aid — a powerful tool of global solidarity that has proven time and time again to save lives.
To make aid live up to the coronavirus crisis, there are three things we believe donors should do now:
1. Urgently inject new money to measure up to the challenge;
2. Help countries shore up prevention, public health systems and cash grants; and
3. Lay the foundations for a deep reshaping of the aid system so that all countries are better prepared in the future.
Here’s what that requires in detail:
1. Raise international aid funds to a level we’ve never seen in our lifetimes
This means protecting existing aid budgets. Some government donors, under political pressure to prioritize domestic responses to the crisis, could chose to cut aid budgets. It would be an unconscionable lack of humanity and solidarity. It would also be unwise: after spreading to other corners of the globe, the virus could circle right back to our doorstep.
It means injecting massive new financial support now to help developing countries face the unfolding crisis — additional to already existing aid funds. UNCTAD estimates that developing countries need $500 billion in aid. At Oxfam, we calculated that the fair share for OECD donor countries would amount to close to $300 billion.
USD 300 billion sounds like a lot? It is. But it’s also less than the wealth of the world’s three richest men combined, and it’s nothing compared to the trillion-dollar rescue packages set up by rich governments in the global North.
What is also key is that donors put new money on the table, and don’t simply reallocate existing aid budgets to the coronavirus response, as some, like France, have started doing. It is a short-sighted approach that will divert funds away from other vital programs.
In Sierra Leone during the Ebola crisis, for instance, there were nearly as many additional maternal and neo-natal deaths as deaths from Ebola, due to reductions in life-saving care for pregnant women. This situation must not be repeated.
A massive injection of new aid funds would also mean that donors finally reach their target of spending at least 0.7% of their national income on aid. This promise was first made at the UN in 1970, and has been repeatedly endorsed by most rich donors since then. Yet in 2019, only 5 donors have achieved it: on average donors only spend 0.3% of their GNI on aid.
2. Focus immediate support on prevention, health, social protection and food assistance
Donors should give priority to supporting developing countries’ prevention and public health responses. These countries are ill-equipped to face the crisis: the Central African Republic for example has only three ventilators, which are vital to treat COVID-19 patients.
Oxfam has called for a Global Public Health Plan and Emergency Response that advocates for an immediate doubling of public-health spending in 85 poor countries in order to save lives.
Aid should also focus on helping partner countries hand out cash and food to people in need, along with other social protection measures, so that people can survive illness and income loss. Aid can play its part in keeping the most vulnerable people afloat. Yet, in 2018, less than one percent of aid was invested in social protection.
How aid is provided will matter, too: it should be given in the form of grants, not loans, as this would only add to poor countries’ debt distress. Instead of creating parallel systems, donors should support responses led by the governments of developing countries and local humanitarian actors, including refugee- and women-led organisations who are at the frontline of the crisis and need to be at the frontline of the response. Where possible, providing aid as budget support can allow countries to maintain public spending throughout the economic crisis.
3. Reshape the future of aid for more equal and resilient societies
History shows that crises often set the stage for major changes. International aid itself emerged as part of reconstruction efforts after World War II. The unprecedented crisis we face today will be a defining moment for the future of aid.
As the coronavirus is threatening to set back the fight against poverty by decades, we must seize this change to save lives — and to repair the systems that made so many people vulnerable in the first place.
This means truly putting inequality at the center of development cooperation. The coronavirus is showing how deep and growing inequalities undermine our ability to face existential threats.
Now is the time for a truly feminist aid that puts gender equality and women’s rights at its heart. For more aid spending in public services that are proven to tackle inequality. For more aid to help developing countries raise taxes progressively, and to active citizens who can hold their government to account. For aid that helps build a human and planet-centered economy.
Think bigger to achieve a just world
This is the time to finally make the aid system more inclusive and legitimate. As a minimum, this would require ensuring aid decisions are made not only by donor countries, but on an equal footing with developing country governments and in consultation with civil society.
But what if we thought bigger? By laying the foundations for a system that is not based on rich countries willingness to ‘give’, but on an internationally agreed mechanism of redistribution from the wealthiest countries to the poorest, we could finally move from charity to justice.
Oxfam’s fair share analysis
Oxfam bases its calculation of fair share on donors’ gross national income (GNI). The members of the OECD Development Assistance Committee (DAC) together account for 59% of total global GNI, so their collective fair share of any appeal or aid pledging target is 59%. This means they should give about USD 300 billion out of the USD 500 billion in aid that developing countries need according to the UN.
New Oxfam report on aid for COVID-19
Oxfam’s new report ‘Whatever it Takes’ lays out in more detail what aid donors can do now to help poorer countries face this unprecedented crisis.
This entry posted 17 April 2020, by Julie Seghers, Policy Lead on Aid and Development Finance at Oxfam International. @JulieSeghers