With the coronavirus pandemic touching nearly every country in the world, the pandemic bond that the World Bank issued in 2017 has been under scrutiny. Despite more than 735,000 cases of Covid-19 and nearly 35,000 deaths attributed to it as of Monday March 30, the bonds have still not been triggered.
It’s hardly surprising that this has attracted criticism: intuitively it seems like nonsense. There is a pandemic under way and these bonds were designed to pay money to poor countries if that happened.
If they haven’t been triggered yet, after all that has happened since December 31, what is the point of them?
The scale of the current pandemic can make the bonds seem like a detail… but it is still worth getting it right
There are, of course, technical reasons for all this. The bonds cannot pay out until 12 weeks have passed, a period that expired on March 23.