LONDON - International organisations have committed more than $48 billion in covid-19 funding, yet this money is not reaching the countries where poverty is increasing most, reveals a new study published today (26th June 2020) by the Centre for Disaster Protection.
The Centre's research, Funding Covid-19, reveals that international organisations have committed a total of $48 billion to low- and middle-income countries in response to the pandemic. But the 20 countries seeing the biggest increases in poverty are only receiving 4% of the funding . The money has disproportionately gone to better-off countries and less is reaching poor countries and countries where covid-19 is increasing extreme poverty the most.
The disparity in how the money is distributed is because 97% of the funding is loans - the equivalent of low-interest credit cards - which has resulted in countries that are considered more able to repay loans benefiting the most. The world urgently needs to find better ways to pay for crises so that poor countries don't miss out, including providing more grants and insurance.
The Centre for Disaster Protection is calling on the organisations providing covid-19 funding, like the IMF, the World Bank and the UN, to ensure that a greater share goes to the places that already have high levels of extreme poverty and where extreme poverty is increasing the most as a result of the pandemic. This means more funds being provided through grants to countries that are unable to borrow more as a result of debt distress.
Ruth Hill, Chief Economist for the Centre, said: "Covid-19 means millions more families are struggling to meet their basic daily needs because of the crisis. Billions has been given in funding but there is a stark inequality in where it is going. International organisations must make more money available to countries where poverty is rapidly increasing to save lives and livelihoods."
Funding Covid-19 is the first study to attempt to track international funding for a crisis. The research puts a total figure on amounts committed and received and allows us to know, for the first time, that $48 billion is on its way to low and middle-income countries to tackle the pandemic and the economic fallout. This figure includes funds from the IMF, the World Bank, most regional development banks and from the United Nations COVID-19 Global Humanitarian Response Plan.
Numbers of people living in extreme poverty are fast rising because of the pandemic (4). 100 million more people are expected to be pushed into extreme poverty now compared to 60 million more just four weeks ago (5).
The Funding Covid19 study will continue to track international funding and is releasing findings on a monthly basis. The findings are published at www.disasterprotection.org/fundingcovid-19.
The World Bank defines "extreme poverty" as living on less than $1.90 (£1.55) per person per day. According to World Bank data, on 20th April, 40 -60 million additional people were expected to be pushed into extreme poverty (classed as living on less than $1.90 a day). By 8th June, that estimate has risen to 71-100 million. https://blogs.worldbank.org/opendata/updated-estimates-impact-covid-19-global-poverty
The Centre for Disaster Protection works to find better ways to stop disasters devastating lives, by supporting countries and the international system to better manage risks. The Centre is founded on the principle that the relative likelihood of particular disasters can be predicted, and that their impact can be managed, with the right plans in place. We help poor and vulnerable countries to move from reaction to readiness, so they can deliver faster, more cost-effective help for those who need it most when disasters occur.
The Centre is funded with UK aid through the UK government.
For more information visit www.disasterprotection.org. Follow the Centre on Twitter @CentreForDP