G20 nations vow to inject $5 tn to fight Covid-19, global slump

Leaders of the Group of 20 or G20 major economies on Thursday pledged to infuse over $5 trillion into the global economy, and do “whatever it takes” to minimize the economic and social impact of the Covid-19 pandemic.

In a joint statement issued after the G-20’s first ever virtual summit, chaired by Saudi Arabia, members committed themselves to restore global growth, maintaining market stability and strengthening resilience. Prime Minister Narendra Modi was among leaders who participated in the video conference.

“We are injecting over $5 trillion into the global economy, as part of a targeted fiscal policy, economic measures, and guarantee schemes to counteract the social, economic and financial impacts of the pandemic. We will continue to conduct bold and large-scale fiscal support. Collective G20 action will amplify its impact, ensure coherence, and harness synergies. The magnitude and scope of this response will get the global economy back on its feet, and set a strong basis for the protection of jobs and the recovery of growth,” the statement said.

While the US announced a fiscal stimulus of $2 trillion, India committed ₹1.7 trillion to help the vulnerable sections of society tide over the financial impact of the coronavirus outbreak.

G-20 members said they were also ready to strengthen global financial safety nets. “We call upon all these (international) organizations to further step up coordination of their actions, including with the private sector, to support emerging and developing countries facing the health, economic, and social shocks of Covid-19.”

G-20 finance ministers and central bank governors will henceforth coordinate their actions on a regular basis to develop an action plan in response to Covid-19, and work closely with international organisations to swiftly deliver appropriate international financial assistance.

“We stand ready to react promptly and take any further action that may be required. We express our readiness to convene again as the situation requires. Global action, solidarity and international cooperation are more than ever necessary to address this pandemic. We are confident that, working closely together, we will overcome this. We will protect human life, restore global economic stability, and lay out solid foundations for strong, sustainable, balanced and inclusive growth.” The members agreed that combating the pandemic calls for a transparent, robust, coordinated, large-scale and science-based global response. “We will expand manufacturing capacity to meet the increasing needs for medical supplies and ensure these are made widely available, at an affordable price, on an equitable basis, where they are most needed and as quickly as possible.”

The grouping also asked the WHO to assess the gaps in pandemic preparedness, in cooperation with relevant organisations, and submit a report before a joint meeting of G-20 finance and health ministers. This will aid establish a global initiative on pandemic preparedness and response.

“This initiative will capitalize on existing programmes to align priorities in global preparedness and act as a universal, efficient, sustained funding and coordination platform to accelerate the development and delivery of vaccines, diagnostics and treatments. To safeguard the future, we commit to strengthen national, regional, and global capacities to respond to potential infectious disease outbreaks by substantially increasing our epidemic preparedness spending. This will enhance the protection of everyone, especially vulnerable groups that are disproportionately affected by infectious diseases,” the statement said.