Insight & Analysis

An economic shot in the arm

Published: Feb 2021

As hopes of economic recovery in Asia are pinned to COVID-19 vaccines, the rollouts are progressing in the region at differing speeds. Now attention is also turning to the equitable distribution of the vaccine.

Distribution, logictics

The prospects of economic recovery in Asia have been tied to the rollout of COVID-19 vaccinations, but so far the progress has been at differing speeds. “Procurement of vaccines has started, but to widely varying degrees in the region - faster in some East Asian economies, for example, much slower elsewhere in the region,” says Abdul D. Abiad, Director in the Asian Development Bank’s (ADB) Economic Research and Regional Cooperation Department. “Last year demonstrated how the pandemic and measures taken to contain it have caused great damage to the region’s economies. The corollary is that vaccination programmes have great potential to support normalisation of activity, from this year onward,” he adds.

Andrea Taylor, Assistant Director of Programs at the Duke Global Health Innovation Center, comments on the differences in Asia’s procurement: “We know that the location of vaccine development and manufacturing capacity matter to regional distribution and access. Asia is home to major vaccine developers and manufacturers and countries in the region have benefitted from this. Countries in Europe and North America have secured more vaccine per capita than most countries in Asia but we have seen a lot of purchase deals by Asian countries and often between Asian countries. However, Asia is also home to the world’s most populous countries so the challenge is immense.”

Taylor notes that India and China stand out in their ability to procure vaccines because they have a relatively large capacity for vaccine development and manufacturing. With domestic access to their own country’s vaccines, they do not have to get in line - and jostle with other countries in the global market - to place their orders. The Serum Institute of India, she explains, formed early tie ups with Oxford-AstraZeneca and Novavax to manufacture and distribute a billion doses of each of their vaccines. Taylor explains they have committed that half of this amount will be reserved for the Indian market.

“Indonesia is another country that stands out, with large state-owned manufacturing capacity. It is in line to be a significant manufacturer for global supply, through a partnership with Coalition for Epidemic Preparedness Innovations (CEPI), as well as domestic supply, through a partnership with Sinovac, though we haven’t seen this fully play out yet.”

Taylor comments that both India and China will be critical to ensuring the supply of vaccine to lower income countries. In January 2021, for example, China began to roll out donations of its vaccines, and was reportedly donating 500,000 Sinopharm’s vaccine to Pakistan. India shipped doses to Bhutan and was expected to donate to eight other countries.

The equitable distribution of vaccines has been a focus elsewhere in the region. In December 2020, the ADB launched the Asia Pacific Vaccine Access Facility (APVAX), a US$9bn initiative to offer rapid and equitable support in procuring and delivering COVID-19 vaccines. The programme is aimed at the ADB’s developing members that require financing to procure the vaccines, as well as assistance in implementing the vaccination process.

“ADB’s priority is to help our developing member countries protect their populations and revive their economies by obtaining safe and effective vaccine and ensuring these reach their people, especially the poor and vulnerable, as soon as possible,” says Jiro Tominaga, Director in ADB’s Strategy, Policy and Partnerships Department. He adds that since the APVAX Facility was approved in December 2020, several countries have indicated their interest in tapping the facility to help finance the procurement of vaccines. “While discussions with most of our member countries are in the early stages, the Philippines has formally requested access to finance under APVAX and discussions are well advanced,” Tominaga says.

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