The outbreak of the Omicron variant in the Southern African region has revived discussions about problematics of vaccine distribution, economic progression and multilevel foreign and domestic policy shifts globally. Covid-19 variants are reiterated as a serious concern to socio-economic and political managements of all countries, and further widens the development gap between the global North and the global South in a long run. As the capacities of both regions to respond to and recover from new variants are originally uneven – and continuously disrupted by their successive aftermaths –, the emergence of the Omicron variant is an alarming sign that the developing world is likely to suffer a longer socio-economic setback and is unintentionally moving away from global sustainable development agendas set for 2030, in contrast to advanced economies. This piece assesses growing global sustainable development risks associated with the emergence of Covid-19 variants. Furthermore, a particular emphasis is put on Africa, as it is one of the most vulnerable regions to the economic, political and environmental impacts of emerging variants.
Covid-19 Variants and North-South Policy, Trade & Investment Issues
As South African scientists were praised for discovering the Covid-19 variant B.1.1.529 – later named Omicron – between November 14 and November 16, its official announcement to the rest of the world has provoked alarming reactions with countries – including Canada, the United Kingdom, the United States, and the European Union countries – quickly restricting travels from South Africa and other Southern African nations. While it is observed that every outbreak of SARS-CoV-2 variants – Alpha, Beta, Gamma, and Delta – has disrupted policies affecting international travel, trade and investment in keys sectors, and aid distributions globally before, it is clear that poorer regions of the global South have remained the most vulnerable. According to Pierella Paci, Practice Manager, Poverty and Equity Global Practice at the World Bank, Sub-Saharan African countries quickly experienced a severe shortage in employment, medical supply, food security and financial donations. Such countries include Burkina Faso, Malawi, Kenya, Ethiopia, Mali, Zambia, Uganda and Nigeria among others.
Although the Omicron variant appears as the lesser evil – as most nations around the world were not thoroughly prepared to deal with previous variants –, the early response to Omicron suggests that developed and developing countries should hammer on international policies promoting sustainable trust, and effective collaboration. Similarly, South Africa’s President Cyril Ramaphosa claims that the Omicron variant should reignite discussions over “vaccine Apartheid” – inequality of vaccine distribution and manufacturing capacity – in the North-South context. As governments from wealthy nations play a leading role in coordinating supportive foreign policies toward the global South, it equally suscitates input from foreign investors. When it comes to Covid response and development, foreign investors are crucial actors who participate in the design of adaptive approaches to trade and investments in the global South. According to the UNCTAD 2021 report, the inflow of foreign direct investment (FDI) to Africa decreased by 15.6% in 2020 – from $4.9 billion in 2019 to $1.6 billion in 2020, with the highest outflow from Togo – $931 million. Furthermore, page 43 of the report shows that this decrease in FDI has contributed to the fall of Africa’s GDP rate from 2.9% in 2019 to -3.5% in 2020 – Although it was expected to rise in 2021. Page 119 of the report states that at least 15 international merger and acquisition (M&A) deals failed – with about $12.4 billion-value deals terminated, down from $87.3 billion in 2019 –, due to “regulatory or political reasons”. Many of the industries were involved in pharmaceuticals, energy, food, electricity, telecommunication. In this sense, individuals from developing countries – especially in Africa – are the most affected by the shortage of crucial trade and investments. Even though trade is bouncing back, it does not appear to reflect significantly on investments in low-income economies as compared to fast recovery in middle- and high-income economies. With the spread of Omicron variant, the economy of the global South can expect another wave of disruption. As long as the pandemic continues to cripple international political consensus, foreign investments and trade will remain at a minimum and the 2030 global agenda – including zero hunger, no poverty, good health – unachievable in the South. Thus, it is important that developed and developing nations harmonize their policy efforts to allow coordinated and effective response to the new and resilient threats that emerge from Covid-19, and limiting setbacks in North-South trade and investment.
Still in the context of investment, the UNCTAD 2021 report shows that several international investment agreements (IIAs) were cancelled, among which those targeting the sub-Saharan African region in 2020. Covid-related travel restrictions from developed nations have not only limited aid distribution to the developing world, but also created a vacuum in foreign direct investments in the sub-Saharan African region. Currently, there are concerns that even the Omicron variant could prolong the negative effects of the pandemic on the North-South relations and their ability to converge toward the achievement of the 2030 sustainable development goals.
More Variants, less Climate Resilience and Energy Transition Capacities?
The recent Glasgow Climate Summit – COP 26 – was depicted by some experts as a “barely” successful global gathering, with not enough efforts by world governments to advance pragmatic and inclusive strategies to combat climate change everywhere. According to Council on Foreign Relations expert Alice C. Hill and Madeline Babin, “countries made notable commitments in the Glasgow Climate Pact, but they still fell short of the action needed to keep global warming within manageable levels”. While this view is shared among communities of activists and policy makers, the emergence of the Omicron variant reminds of continuous socio-economic hindrances of Covid-19 pandemic, and risks associated with climate adaptation and mitigation in the global South.
Like the rest of the world, Africa’s energy transition is increasingly needed not only to fight climate change, but also to upgrade its economy to a sustainable level. However, the continent is still [greatly] relying on fossil fuels to support its economic and social activities. According to Bloomberg’s opinion columnist Mark Buchanan, Africa will likely increase its carbon footprint, as it will still get only 10% of its electricity from renewables, and about 80% from fossil fuels. As achieving net-zero emissions by 2030 was already a speculation on the continent, socio-economic and political obstacles of the new Covid variant become a higher concern – pushing climate action and mitigation at a lower rank in Africa’s priority. Data from the World Bank show that, in 2018, sub-Saharan African region reached a CO2 emission of 0.76 metric ton per capita, with a rapid increase in fuel consumption since the beginning of this century. As such, recovering from the economic damages of the current pandemic – and potentially the Omicron variant – may require to increase even more consumptions of fossil fuels by industries and households on the continent.
If Africa is to boost its chance to align in the race of global climate goal by 2030, efforts could require multilevel actions. Not only more foreign financial aid and infrastructural investment are needed to support energy transition projects on the continent, but equally a strong commitment between wealthy nations of the global North and poor African nations to equate responses to Covid variant outbreaks.
The global South still bears its name today mainly due to continuous socio-economic and political challenges. New challenge like the Covid-19 pandemic unveils weaknesses of global governance, particularly the status quo of the North-South relations and the ability of both regions to face and overcome common hindrances. While promoting global sustainable development is undoubtedly a proof that world nations understand the importance of their interconnectedness, it is also clear that the process to achieve such objective implies better cooperation between state governments and individuals. As greener economy and climate resilience are crucial for global sustainable development, so is pragmatic collaboration in response to present and future pandemics everywhere.