Pandemic Emergency Financing Facility: struggling to deliver on its innovative promise

The Ebola outbreak in west Africa in 2014-16 exposed many flaws in the global response to infectious disease.12 In particular, it highlighted the gap between countries’ commitments for outbreak preparedness, detection, and response, as required under the International Health Regulations, and their actual ability to respond when needed. This is partly due to a lack of financing.34 Responding agencies such as governments and non-governmental organisations were on the back foot when trying to fund control efforts as the Ebola epidemic increased in intensity.12 Prompt financing during the early stages of outbreaks can limit a pathogen’s spread,5 and the World Bank estimated that early financing of $100m (£81m; €92m) could have averted much of the subsequent socioeconomic and human crisis.6

In 2016, the bank set up the Pandemic Emergency Financing Facility (PEF) to quickly release funds to the world’s poorest countries and agencies to mitigate the humanitarian and economic consequences of potential pandemics caused by specific viruses.7 PEF created a market for pandemic risk insurance that draws on funds from the private sector through (catastrophe) bonds and swaps (a temporary agreement between two parties to exchange cash flows or liabilities from other financial instruments, often used to reduce financial risk) in return for highly lucrative interest rates. It was heralded as an innovative financial instrument to revolutionise the challenge of raising capital, which had hindered the work of many other donor reliant funds such as the UN’s Central Emergency Relief Fund (CERF) and the World Health Organization’s Contingency Fund for Emergencies (CFE).

Although CERF and CFE have released funds rapidly and continuously to mitigate outbreaks since 2016, including …