Coronavirus response must be ‘never again’

The writer is executive director of the Global Fund to Fight Aids, Tuberculosis and Malaria

Twenty-two months after I took charge of Standard Chartered, one of the world’s largest international banks, Lehman Brothers collapsed, triggering the 2008 financial crisis. Some 22 months after I moved to the Global Fund to Fight Aids, Tuberculosis and Malaria, a new strain of coronavirus emerged in Wuhan, China. My friends have asked me to warn them if I switch fields again.

The early response to the disease known as Covid-19 feels eerily reminiscent of the lead in to Lehman’s fall. We are seeing a weird mix of panic and denial; business leaders looking like rabbits in headlights as their share prices plummet; and a potpourri of uncoordinated, inward-looking interventions across different countries.

Although it didn’t feel that way at the time, Lehman’s bankruptcy probably saved the global financial system. By bringing the world to the brink, the collapse catalysed unprecedented action by governments, central banks and international financial institutions. It dispelled any illusion we could somehow muddle through. The global financial system would need to be not just saved, but redesigned.

For Britain alone the rescue plan involved the commitment of hundreds of billions of pounds, and governments across the world followed suit with bailouts of struggling banks, the massive provision of liquidity to keep the financial system afloat, and a range of measures to mitigate the impact on the rest of the economy. The world’s leading central banks, and G7 and G20 leaders, met constantly to co-ordinate their interventions. Trillions of dollars were mobilised within weeks.

It wasn’t just about putting out the fire. The phrase “never again” was in every speech. In April 2009, G20 leaders committed to a radically new approach to global finance, establishing the Financial Stability Board and demanding a complete overhaul of bank regulation.

For the coronavirus, the quarantine of Wuhan has not been our Lehman moment. Chinese authorities have responded with an extraordinary range of public health measures, imposing “social distancing” and quarantining entire cities at a scale never seen before. This does appear to have contained the disease in China, at least for now. It also bought the rest of the world precious days in which to prepare.

But we have not used that time well. As the world wakes up every morning to spiralling numbers of cases and deaths, and plunging stock markets, we are still in the pre-Lehman phase of policy response. Politicians are largely focused on national responses, often shaped as much by the perceived local politics as by the underlying threat. Business leaders worry about their own staff, customers and supply chains, and feel powerless about their share prices. People across the world are scared and bewildered by the avalanche of facts and misinformation.

Some are taking action. The European Commission contributed €232 million, the World Bank is making $12bn available to support poorer countries, and the IMF has offered $50bn. Yet given the number of lives that could be lost and the scale of economic disruption already evident, this isn’t remotely enough. So far the policy response is a tiny fraction of what we saw post-Lehman. And this time people are dying.

The World Health Organization — rising to the challenge — has asked for $675m to lead the global response. So far it has been given a fraction of that. The Coalition for Epidemic Preparedness Innovations, which is leading the race to develop a vaccine, needs at least $2bn to turbocharge this effort. We urgently need funds for a co-ordinated effort to identify, trial and make available potential treatments.

Where potential treatments can still be patented, there is a commercial incentive for the drug companies to test them. But many promising candidates, such as chloroquine or antiretrovirals, are no longer patent-protected, so will never be lucrative. Think of what a difference it would make if we quickly identified and made available a treatment that significantly reduced mortality.

We know that the global community can mobilise in the face of a global health threat. HIV/Aids — arguably the last big global pandemic — has killed about 32m people and still kills nearly a million a year. But far more would have died without the creation of the Global Fund in 2002. It is estimated to have helped save more than 37m lives in total. I am not suggesting we need an equivalent fund for Covid-19, or for global health security. We arguably have too many institutions in this arena already. But it does show that a global collective response is possible.

When Tedros Adhanom Ghebreyesus, the WHO director-general, says: “This is not a drill. This is the time to be pulling out all the stops,” we had better listen, and act.

Covid-19 is a wake-up call to rethink our approach to global health security.

Since the 2008 crisis, the world has spent trillions of dollars to reinforce global financial stability. Do we really care that much less about health security?