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December 12, 2020

ADB rolls out $9 billion Covid vaccine scheme for developing members

Business

December 12, 2020

Bangkok/Manila: The Asian Development Bank has launched a $9 billion vaccine initiative to provide “rapid and equitable support” to developing countries in the region seeking to roll out mass Covid-19 inoculations.

The Manila-based, Japanese-backed development bank’s board approved the facility on Friday, saying that promoting “safe, equitable and effective access to vaccines” was a priority.

“Due to the hyperconnected nature of the world today no country is immune from Covid-19 unless and until all countries overcome the pandemic,” Masatsugu Asakawa, ADB president, told the Financial Times.

“Steps for developing and distributing vaccines should be collaborative among countries and international organisations.”

If market mechanisms solely determined vaccine supply, some Asian countries could face delays in securing and administering vaccines, Asakawa said.

The $9 billion scheme, structured as a credit facility, will support Asian developing countries’ efforts to procure vaccines rapidly as well as their investments in vaccine production and distribution systems. The ADB also said it was making available a $500 million vaccine import facility to help countries secure “safe and effective” vaccines.

Asakawa said the ADB had received informal requests for support from Indonesia and the Philippines — the south-east Asian countries with the highest number of coronavirus cases — as well as the South Pacific islands. “They are waiting for this,” he added.

The bank did not give a firm timetable for when the money might be available, but Asakawa said that following the ADB board’s approval and pending procedures in given countries, funds “can be disbursed quite quickly”. The ADB financing, which will be provided in close coordination with other development partners, including the World Health Organization, may also be tapped to develop or expand vaccine manufacturing capacity in developing members, the ADB said in a statement. The bank separately in April approved a $20 billiob package to support developing Asian countries coping with the pandemic and in November sealed a $20 million technical assistance programme.

Developing Asia is on course to post an economic contraction this year, but probably less than previously thought as China recovers faster than expected, although the prolonged pandemic remains a risk to the outlook, the ADB said on Thursday.

The pandemic has hammered Asia’s developing economies, with gross domestic product growth set to drop by an average of 0.4 percent this year, the first contraction in six decades.

For 2021, the region is still forecast to recover and grow 6.8 percent, the ADB said, as Asian economies gradually revive from the COVID-19 pandemic that has infected more than 14.3 million killed more than 200,000 in Asia and the Pacific.

According to the bank, the countries that successfully contained Covid-19 — notably China and Vietnam — will report positive growth this year, but those contending with large outbreaks, including India, Indonesia, Malaysia and the Philippines, will suffer economic contractions.

Asian countries have made different preparations to import vaccines, including the one developed by AstraZeneca and Oxford university, Russia’s Sputnik V and China’s CoronaVac. Companies in some countries, including Vietnam, are developing their own. The ADB said the $9 billion facility would support the rollout of either Covid-19 vaccines procured by the Global Vaccine Alliance’s Global Access Facility (Covax), those pre-qualified by the World Health Organization, or those whose manufacturing has been authorised by national drug regulatory authorities recognised by the WHO. —The Financial Times Limited 2020