Andrea Shalal, David Lawder

WASHINGTON, (Reuters) – Supply chain problems and rising inflation worries were pushed aside by a wider gap in COVID-19 vaccines and mounting debt problems of developing countries. These concerns were the main concerns of global policymakers attending this week’s International Monetary Fund annual meeting and World Bank Annual Meetings.

While there were relatively few new developments in the area of increasing vaccine supplies for developing countries, officials noted that divergence among rich and poor countries was a rising financial and economic threat.

For anti-poverty movements, the failure to focus attention on the normalization difficulties that richer countries are facing and the World Bank data-rigging controversy that clouded Kristalina Georgiaieva’s future IMF managing director was disappointing.

Eric LeCompte (executive director, Jubilee USA Network), a religious-development group, stated, “Given how pandemics are becoming more severe in most countries worldwide, I’m worried by the lack of action during the meetings on vaccination distribution, debt reduction and general pandemic response.”

The G20 finance chiefs and IMF steering committee members issued communiqués pledging to boost vaccine supply, however they did not specify any new goals or initiatives for expanding financing and distribution. Instead they emphasized the growing inflation pressures. They urged central banks not to ignore them and to keep an eye on whether or not they could destabilize inflation expectations.

NOT ENOUGH

Tedros Adhananom Ghebreyesus, chief of World Health Organization, stated to an IMF forum in New York that the world has fallen behind its goals of immunizing 40% of the population by this year. He also criticized rich countries for agreeing to third booster shots while a large portion of the population still needs to be vaccinated.

The donations don’t go far enough. He said that it was very disappointing that the world has taken so much time to commit to achieving vaccination goals.

According to the IMF, a “great vaccine gap” is keeping emerging countries stuck in low growth due to high rates of coronavirus infections. The IMF cut its 2021 global growth projection due to supply chain bottlenecks. There are also shortages of semiconductors. And there is rising pressure from advanced economies.

“BEYOND COVID”

Some policymakers were more concerned with managing the next phase of recovery, after unprecedented fiscal assistance, than other multilateral issues like implementing a deal that would overhaul global corporate taxes.

Bruno Le Maire, French Finance Minister, stated to reporters that he felt the same about Washington meetings and IMF meetings.

Le Maire declared, “Even if it is necessary to monitor the situation, and even though there are some vaccine decisions that need to be made, especially for those in the most poorest countries,”

However, he said that France supported increased financial assistance for the developing countries, with at least $100 Billion in IMF monetary reserve to be diverted to poor nations after an August distribution of $650 billion.

Advocate groups disappointed by the lack of progress in debt relief for the least developed countries. This is especially true since payment on bilateral official debts for 46 countries will resume on January 1, when the G20 Debt Service Suspension Initiative ends.

Jean Saldanha is director of Eurodad’s Debt and Development Watchdog Group. He said that statements by G20 and IMF committees on debt were “shameful” as they failed to encourage greater participation in G20 Common Framework on Debt Reform.

Saldanha stated that maintaining an almost blind belief in the Common Framework’s ability to address debt distress in a growing number of countries in South Asia is reckless to put it mildly.