Can Pandemic Bonds Deliver on Their Promise?

Epidemics are an unpredictable, though, recurrent feature of human history. With seven major outbreaks over the past twenty years, epidemics and pandemics are on the rise, and happening more frequently and closer to one another than before. Lack of funding makes developing countries especially vulnerable to epidemics. In 2017, the World Bank launched pandemic bonds to raise funding that can be deployed rapidly in the case of a pandemic. Coming 106 days after the World Health Organization declared COVID-19 a pandemic, the bonds’ payout may be only minimally helpful to some of the poorest countries’ efforts to fight the outbreak, and leave the impression that the bonds delivered too little too late. Pandemic bonds remain an important financial tool and, with some restructuring, could fill a crucial gap in global health security, while at the same time continuing to engage with capital markets for the benefit of the poor.