Vaccine inequality and economic misfortune

‘The global scheme to deliver COVID-19 vaccines to poorer countries faces a “very high” risk of failure, potentially leaving nations home to billions of people with no access to vaccines until as late as 2024. That is according to internal documents seen by Reuters. The World Health Organization’s [WHO] COVAX programme is the main global scheme to vaccinate people in poor and middle income countries around the world against the coronavirus. It aims to deliver at least 2 billion vaccine doses by the end of 2021 to cover 20% of the most vulnerable people in 91 poor and middle-income countries, mostly in Africa, Asia and Latin America. But in internal documents reviewed by Reuters, the scheme’s promoters say the programme is struggling from a lack of funds, supply risks and complex contractual arrangements which could make it impossible to achieve its goals.’—Reuters

Africa, Asia, and Latin America are the places where most of world’s poor live. According to World Bank, around 150 million people are likely to fall below the poverty line as a result of the pandemic. In addition to the Reuters’ article cited above, Economist Intelligence Unit recently reportedly pointed out that many countries in Africa, and a number of countries in Asia, including Pakistan, and a couple in Latin America, were a group of countries where vaccines will be widely available most late among countries overall; to be more precise sometime between April 2022-2023.

Given this situation, by the time vaccines are expected to widely roll out in these countries, it is quite likely that poverty will be a lot higher than what is being predicted by the World Bank. Together with the phenomenon of ‘Long Covid’ and new and faster strands of Covid coming to the fore, may all mean that the crisis in public health sector and overall deep economic recession, especially in these low and middle-income countries, will likely continue longer than what was initially expected, when the news of a successful vaccine was first heard, back in November. Hence, inequality in the way vaccine will be rolled out, is likely to produce deep ripples of economic misfortune, mainly in low and middle-income countries.

Reportedly, around 70 per cent of the overall population of the world needs immunization to successfully end the risk of outbreaks of Covid in the future. Having said that, with rich countries already booking most of the vaccine expected to be produced till the end of next year, means a significant proportion of people, mostly in developing countries, will have to wait for at least after 2021 to start getting vaccines. Moreover, given a very narrow roll-out of vaccine in terms of being heavily skewed towards rich countries expected to take place going forward, also points towards high difficulty in avoiding future outbreaks of Covid, since according to the WHO, only around 10 per cent of the people globally so far have been infected, which as per the WHO means ‘the vast majority of the world remains at risk’.

In this regard, in a recently published research article ‘Reserving coronavirus disease 2019 vaccines for global access: cross sectional analysis’ Anthony D. So and Joshua Woo of Johns Hopkins University, pointed out serious inequality in vaccine roll-out as a result of inordinate use of financial muscle of rich countries; and a clear admission of failings of multilateral institutions like the WHO in bringing greater equitability in terms of vaccine availability globally.

This they point out as: ‘As of 15 November 2020, several countries have made pre-market purchase commitments totalling 7.48 billion doses, or 3.76 billion courses, of covid-19 vaccines from 13 vaccine manufacturers. Just over half (51%) of these doses will go to high income countries, which represent 14% of the world’s population. The US has reserved 800 million doses but accounts for a fifth of all Covid-19 cases globally (11.02 million cases), whereas Japan, Australia, and Canada have collectively reserved more than one billion doses but do not account for even 1% of current global covid-19 cases globally (0.45 million cases).… This study provides an overview of how high income countries have secured future supplies of covid-19 vaccines but that access for the rest of the world is uncertain.’

In addition to there being deep inequality expected in vaccine roll-out, resulting in Covid vaccine likely to reach a significant portion of those needing vaccine globally with a lot of delay, it therefore, most probably would seriously dent economic recovery prospects in many parts of the world. Among creating a lot of frustration among the masses, which is likely to add to already difficult times for the future of globalization, and multilateralism – where issues should have rather been reduced to present a more potent unified global effort against the pandemic and the existential threat of climate change – the current vaccine roll-out-related depressing situation will likely aggravate the already rising level of political radicalization and polarization globally, giving greater political space to otherwise traditionally off-spectrum, extreme political parties.

In a recent Foreign Affairs article ‘The dangers of vaccine disillusionment’ Josh Michaud and Jen Kates point out that ‘Once it becomes clear that a vaccine won’t mean immediate deliverance from the crisis, there is a risk that popular disillusionment could set in, deepening the creeping skepticism of vaccines in parts of the world and adding to the already formidable challenge of immunizing more than half the global population. Governments must therefore guard against popular frustrations by communicating clearly and tempering expectations—all while pushing forcefully ahead with immunization campaigns to save as many lives as possible.’

This will also add to weakening capacity of countries to enhance economic growth, which in turn is not only important for meeting huge stimulus demands as a result of the pandemic, but also dealing with both an unprecedented level at which global debt has already reached, and the burgeoning debt over-hang becoming all more ominous in the likely, and unfortunate reality of slow and quite unequal roll-out of the vaccine.

Therefore, in addition to dealing with the ‘disillusionment’ aspect, the deep existence of patents involved in the overall pricing of Covid vaccines also needs to be dealt with by governments and multilateral arrangements, both to allow countries, especially the developing world, to secure greater fiscal space for meeting extensive stimulus needs, including spending for purchasing Covid vaccines, and for stemming the sharp rise in debt servicing needs. In this regard, it is important that a reportedly multibillion dollar financing gap in COVAX programme is bridged, for which among other initiatives, it is important that Russia and the USA also join this programme.

For the particular case of managing patents, in a recent New York Times article ‘Want vaccines fast? Suspend intellectual property rights [IPRs]’ Achal Prabhala, Arjun Jayadev, and Dean Baker were first of all highly critical, and rightfully so, of the way advanced countries have adopted vaccine nationalism to the disadvantage of many globally, in not just the way they have selfishly booked vaccine supplies, but also by not taking steps with regard to reducing/suspending/eliminating IPRs.

In this regard, they point out that ‘But this is not the beginning of the end; it is only the beginning of an endless wait: There aren’t enough vaccines to go around in the richest countries on earth, let alone the poorest ones. That’s why it makes little sense that the United States, Britain and the European Union, among others, are blocking a proposal at the World Trade Organization [WTO] that would allow them, and the rest of the world, to get more of the vaccines and treatments we all need. The proposal, put forward by India and South Africa in October, calls on the W.T.O. to exempt member countries from enforcing some patents, trade secrets or pharmaceutical monopolies under the organization’s agreement on trade-related intellectual property rights, known as TRIPs.’

The proposal pointed out, among other things, that in the wake of the pandemic-created ‘exceptional circumstances’ such IPRs needed to be suspended because they were ‘hindering or potentially hindering timely provisioning of affordable medical products’. The fact that multilateralism needs a serious re-visit, came to the fore once again, in the way this proposal was rejected by a handful of mostly advanced countries on the basis of decision-by-consensus rule of WTO, when around 100 countries were in favour of it.

At the same time, while the opponents of the proposal highlighted the need for patents, where a trade representative of US pointed out in this regard that the patents were important for ‘facilitating incentives for innovation and competition’, yet as the same article pointed out that ‘the vaccines developed by these companies were developed thanks wholly or partly to taxpayer money. Those vaccines essentially belong to the people — and yet the people are about to pay for them again, and with little prospect of getting as many as they need fast enough.’

What a grave tyranny of the neoliberal assault, which has entrenched deeply overtime and needs dismantling, whereby there is serious inequality in the way a life-saving vaccine is being rolled out, which means that rather than quickly combating a) a pandemic and save lives, b) deep recession and debt burden, c) rising poverty, and d) radicalization in politics, among other serious politico-economic threats, the lopsided roll-out is further weakening confidence of masses in multilateralism, globalization, and democracy; in turn, enabling a small segment of politico-economic elites in mostly advanced countries to extract rents and gain local political mileage.

(The writer holds PhD in Economics from the University of Barcelona; he previously worked at International Monetary Fund) He tweets@omerjaved7

Copyright Business Recorder, 2021