FOCUS: Expert urges Japan to lead global health finance amid COVID crisis

Aug 17 , 2021. 2 hours ago – 08:27 By Ko Hirano, KYODO NEWS

(Clockwise from far L) European Council President Charles Michel, Japanese Prime Minister Yoshihide Suga, German Chancellor Angela Merkel, French President Emmanuel Macron, British Prime Minister Boris Johnson, U.S. President Joe Biden, Canadian Prime Minister Justin Trudeau, Italian Prime Minister Mario Draghi and European Commission President Ursula von der Leyen hold talks on the first day of a three-day Group of Seven summit in Cornwall, England, on June 11, 2021. (Kyodo) ==Kyodo

TOKYO – Japan was the largest provider of development aid in response to the COVID-19 health and economic crisis among the Group of Seven industrialized nations in 2020 despite the hit its economy suffered during the pandemic, according to an independent study.

Japan committed $5.1 billion in new aid funding last year, compared to $4.4 billion pledged by Germany, $1.9 billion by France and $1.0 billion by Canada, the study by Kiyoshi Kodera, a former Japanese Finance Ministry and World Bank official shows, citing data from the Overseas Development Institute, a British think tank.

Among other G-7 members, Britain committed $990 million, the United States $103 million and Italy $50 million.

“If you compare data among the G-7 members, we can see that Japan played a significant role as a major donor even at the time of the coronavirus crisis,” said Kodera, now a senior research associate at the London-based ODI.

Most of the $5.1 billion in official development assistance — which came on the heels of a 4.8 percent fall in Japan’s gross domestic product in 2020, the second sharpest contraction on record — was targeted at developing countries mainly in Asia and multilateral institutions to assist in their fight against COVID-19 and the economic crisis, he said.

However, Kodera expects the United States to overtake Japan as the top aid provider among the G-7 in 2021, partly because President Joe Biden’s administration extended $2 billion to the COVAX global vaccine-sharing program, the largest single financial contribution to the U.N.-backed initiative snubbed by his predecessor Donald Trump.

Kiyoshi Kodera, a former Japanese Finance Ministry and World Bank official who now serves as a senior research associate at the London-based Overseas Development Institute, speaks in an interview with Kyodo News in Tokyo on Aug. 16, 2021. (Kyodo)

In the absence of comprehensive data for Japan’s ODA program, Kodera tallied figures such as ODA outlays in the country’s initial budget for fiscal 2020, ODA spending from the reserve fund for fiscal 2019 and ODA earmarked in the fiscal 2020 supplementary budgets.

“Government agencies release information about ODA individually and sporadically. For outsiders, Japan’s information looks fragmented and hard to comprehend,” he said in an interview.

“This has made it difficult for Japan as a whole to communicate with the world about the country’s development aid in a holistic and more effective way.”

The Foreign Ministry can produce better global narratives by incorporating, for example, the government’s contributions to trust funds run by the World Bank and the Asian Development Bank via the Finance Ministry as well, he said.

Kodera retired from public service in 2016 as a Japan International Cooperation Agency vice president after holding posts such as deputy vice minister of finance for international affairs and executive secretary of the Development Committee of the World Bank and the International Monetary Fund, a career that earned him the nickname “Mr. Development.”

Besides the ODI post, the 69-year-old wears other hats such as chair of the board of WaterAid Japan, an international nongovernmental organization for water and sanitation, and board member of Save the Children Japan.

While hailing Japan for offering COVID-19 vaccines and cold chain storage equipment such as refrigerated vaccine transport vehicles to poor countries in what some view as a counter to China’s vaccine diplomacy, Kodera urges Tokyo to play a greater role in strengthening health systems in the developing world.

“Besides vaccine supply, critical issues for developing countries are that they have a serious shortage of medical professionals who give shots, and that people are skeptical about vaccines based on misinformation and unsubstantiated rumors,” he said.

“Japan can take the lead in helping poor countries train medical professionals and increase funding for vaccination campaigns as fundamental pillars for bolstering health systems in the developing world.”

Kodera also requested health and finance policymakers in developing countries to step up coordination so that countries such as Indonesia and the Philippines, whose percentage of state budgets dedicated to health and medical expenditures are comparatively small, can establish sustainable health finance systems.

“Without solely relying on foreign aid, developing economies must ensure sound tax revenue and budget implementation systems so that the health sector is financed by taxpayers’ money,” he said.

“Otherwise, poor people will never be able to join universal health coverage systems, making it difficult for them to go to hospital even if they want to. They will not increase the number of doctors, nurses and local clinics in a sustainable way, either.”

Kodera welcomed a pledge by the Group of 20 major economies in July to cooperate with international institutions such as the World Bank, the IMF and the World Health Organization in developing proposals for sustainable financing in an effort to strengthen future pandemic preparedness and responses.

In a communique issued after a meeting in Venice, Italy, the G-20 finance ministers and central bank governors tasked experts from their respective finance and health ministries to present “concrete proposals” at a joint meeting of G-20 finance and health ministers to be held on the sidelines of a G-20 summit in October in Rome.

Japan hosted the first such joint session when the G-20 leaders held a summit in Osaka in 2019.

Similarly, Finance Minister Taro Aso exhibited Tokyo’s leadership when he advocated an additional replenishment of the capital of the International Development Association, a member of the World Bank group, last fall as part of efforts to better fight the COVID-19 crisis.

Cr.KYODO NEWS