“Old Scars, New Wounds” Technical Update #2
In the wake of the global economic shocks from the COVID-19 pandemic and the Russian invasion of Ukraine, rifts between countries in their capacity to spend on health will be growing.
- In 41 countries, government spending until 2027 is projected to remain lower than before COVID-19, restricting their ability to invest in critical areas, including health.
- In 69 countries, government spending is expected to exceed 2019 levels, but the increases will be weak.
- And in only 67 countries, government spending is projected to increase steadily through 2027.
In many countries, rising interest payments on public debt further threaten their capacity to invest in health.
- With debt levels at record highs and interest rates rising to control inflation, many governments will struggle to meet interest payments on public debt.
- Interest payments will constrain the capacity of low-income countries to spend on health on average by 7% and in lower middle-income countries by 10 % in 2027.
- The impact of interest payments varies vastly across these countries, in some of them, they are expected to constrain their health spending capacity between 15-30% in 2027.
Without immediate action, many low- and lower middle-income countries will be left behind on the path to health and economic recovery.
- The projected decline of government spending in many low and lower-middle income countries will restrict their ability to strengthen pandemic preparedness and limit their progress towards universal health coverage.
- This will lead to growing inequalities between countries, threatening global stability, and prosperity.
- Governments need to increase revenues, give greater priority to health in budgets, and improve the efficiency and equity of health spending.
- By increasing development aid and working towards comprehensive debt solutions for low- and lower middle-income countries, high-income countries can preempt emerging threats to peace and prosperity – securing a healthier, more secure future for all.