COVID-19 Likely to Reshape the Multilateral Governance System

Author: Zeng Lu 

With their professionalism and global influence, multilateral development institutions have played a unique role in coordinating and responding to the new crown epidemic. The epidemic has highlighted the challenges facing the multilateral system, and it has also put forward new requirements for the reform of the multilateral governance system.

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The COVID-19 pandemic has triggered global public health, economic and social crises and eroded hard-won development gains. It is estimated that by the end of this year, 150 million people around the world will fall into extreme poverty. Developing countries, with weak financial resources and weak public health systems, are particularly hard hit by the epidemic. With their professionalism and global influence, multilateral development institutions have played a unique role in coordinating and responding to the global epidemic.

Multilateral institutions play an important role in the epidemic

Multilateral institutions facilitate cooperation and provide large amounts of funding quickly.The International Monetary Fund (IMF), the World Bank (WBG) and the Group of Twenty (G20) are actively promoting international cooperation to alleviate the aggravated epidemic situation in developing countries.debt burden. In just a few weeks after the outbreak was declared a global public health emergency, international institutions such as multilateral development banks provided nearly $250 billion in support to developing countries. In comparison, bilateral aid directly provided by governments totaled approximately $5.5 billion as of May 2020.

Health sector agencies and vertical funds facilitate information sharing to support vaccine development, production and distribution.The World Health Organization (WHO) works with developing countries to share epidemic information, issue technical guidelines, provide testing and diagnostic equipment, and support multinational vaccine research. Co-sponsored by Gavi, the Coalition for Epidemic Preparedness Innovations (CEPI) and WHOCOVID-19 Vaccine Implementation Plan (COVAX), Support the development, production and fair distribution of the new crown vaccine. As of May, COVAX has provided more than 70 million doses of vaccines to 126 low- and middle-income countries and regions.

Multilateral financial institutions and the United Nations support the emergency response and long-term recovery of the outbreak.In 2020, international financial institutions approved a total of US$237.2 billion to support developing countries in responding to the epidemic. Among them, the IMF approved US$102.9 billion in emergency aid and preventive credit lines, and the European Investment Bank (EIB), the World Bank and other multilateral development banks approved a total of US$132.5 billion. The United Nations has launched mechanisms such as the Global Humanitarian Response Plan (GHRP) and the New Crown Response and Recovery Fund (RRF) to strengthen local health systems in vulnerable areas and help low- and middle-income countries cope with the impact of the epidemic.

The IMF and G20 help developing countries ease their debt burdens.As of May, the IMF provided debt relief totaling about $700 million to 29 of the poorest countries through the Catastrophe Containment and Relief Trust (CCRT). The G20 Debt Suspension Initiative (DSSI) has provided about $5 billion in liquidity relief to more than 40 countries. With the support of all parties, the IMF will issue an additional $650 billion in Special Drawing Rights (SDR). These measures will help developing countries to ease the pain caused by the epidemicdebt burden, to free up resources to deal with the epidemic.

Pandemic highlights challenges facing multilateral governance system

Before the pandemic, the multilateral governance system was already facing severe challenges.The multilateral governance system was formed after World War II. Over the past few decades, the global development pattern has undergone tremendous changes, and global challenges such as the new crown epidemic and climate change have continued to emerge, exacerbating the challenges facing the multilateral governance system. International institutions are also under pressure to reform. Some multilateral institutions have overlapped and fragmented functions, creating fierce competition for resources. In recent years, the rise of nationalism and protectionism in some countries has eroded the multilateral governance system,U.S. withdraws from Paris AgreementSuch multilateral mechanisms are its prominent manifestation.

The epidemic has highlighted the fragility of the multilateral governance system.During the epidemic, the credibility of some multilateral institutions was damaged. The United Nations Security Council (UNSC) has been unable to reach a resolution on a ceasefire in conflict areas during the epidemic, and the WHO's response to the epidemic has also been questioned. The financial stability of some multilateral institutions has been affected. At one point, the United States announced that it would withdraw from the WHO, and the organization's budget funds for 15%-20% were affected by this decision. The pandemic has eroded hard-won development gains and exacerbated challenges to the sustainable development agenda. Development indicators such as global poverty rates and newborn and maternal mortality rates have regressed. The epidemic occupies a large amount of development funds and affects the implementation of other sustainable development goals; the fiscal revenue of donor countries is dragged down by the epidemic, which will affect the scale of global development assistance in the next few years.

Global challenges place new demands on the multilateral development system

Strengthen multilateralism and international cooperation.The global challenge of the epidemic highlights the interdependence of countries around the world. As long as there is an epidemic in one country, other countries are at risk. Effective responses to the pandemic can only be achieved by sharing information and knowledge, expanding testing and treatment, and promoting widespread vaccination as an accessible and affordable global public good that supports emergency response and long-term recovery in all countries. The epidemic has exposed the shortcomings of the multilateral governance system and highlighted the urgency of reforming the multilateral governance system.

Formulate the core principles of new multilateralism and lay the foundation for the reform of the global governance system.All countries should form a consensus on the core principles of new multilateralism that adapt to the global development pattern in the 21st century. A working group can be established under the G20 mechanism to extensively solicit opinions from different regions and policy areas, and form new principles of multilateralism through consultations. The formulation of principles should fully consider factors such as diversity, representation, and sustainability. Multilateralism that embraces diversity can meet the needs of different countries. Greater and more meaningful participation of developing and least developed countries in global decision-making processes should be promoted. All countries should agree on principles for the provision of global public goods and the management of the global commons.

Enhance the capacity of multilateral institutions to adapt to changes and new challenges in the global environment.The constitutions of multilateral organizations should be flexible enough to adapt to the rapidly changing global environment. Multilateral organizations should seek more core funding from traditional donor countries and improve their financing capabilities from non-traditional sources such as the private sector to ensure their own flexibility and independence. Multilateral institutions should increase flexibility, innovate inclusive solutions, adjust the scope of recipient countries, key countries and areas, etc. when necessary, and invest sufficient resources in intersectoral and transnational activities to adapt to the rapidly changing global environment and new global challenges.

Balancing short-term urgent needs and long-term development challenges to optimize development outcomes.The emergency response and long-term recovery of the epidemic should be considered comprehensively, as well as other important areas of the United Nations sustainable development agenda. sustainable growth. In addition, it is necessary to deeply reflect on the problems that have emerged in the epidemic, and improve efficiency and optimize development results by strengthening coordination among multilateral institutions.


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Comment (1)

  • Petite Ali| July 11, 2021

    The impact of the new crown is far-reaching, and it may be an opportunity for China.

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