One Vaccine Side Effect: Global Economic Inequality

• As Covid inoculations begin, the economic downturn stands to be reversed, but

developing countries are at risk of being left behind.

By Peter S. Goodman

• Published Dec. 25, 2020Updated Dec. 31, 2020

1 - LONDON — The end of the pandemic is finally in view. So is rescue from the most traumatic
global economic catastrophe since the Great Depression. As Covid vaccines enter the
bloodstream, recovery has become reality.

2 - But the benefits will be far from equally apportioned. Wealthy nations in Europe and North
America have secured the bulk of limited stocks of vaccines, positioning themselves for starkly
improved economic fortunes. Developing countries — home to most of humanity — are left to
secure their own doses.

3 - The lopsided distribution of vaccines appears certain to worsen a defining economic reality:
The world that emerges from this terrifying chapter in history will be more unequal than ever. Poor
countries will continue to be ravaged by the pandemic, forcing them to expend meager resources
that are already stretched by growing debts to lenders in the United States, Europe and China.

4 - The global economy has long been cleaved by profound disparities in wealth, education and
access to vital elements like clean water, electricity and the internet. The pandemic has trained
its death and destruction of livelihood on ethnic minorities, women and lower-income households.
The ending is likely to add another division that could shape economic life for years, separating
countries with access to vaccines from those without.

5 - “It’s clear that developing countries, and especially poorer developing countries, are going to
be excluded for some time,” said Richard Kozul-Wright, director of the division on globalization
and development strategies at the United Nations Conference on Trade and Development in
Geneva. “Despite the understanding that vaccines need to be seen as a global good, the provision
remains largely under control of large pharmaceutical companies in the advanced economies.”

6 - International aid organizations, philanthropists and wealthy nations have coalesced around a
promise to ensure that all countries gain the tools needed to fight the pandemic, like protective
gear for medical teams as well as tests, therapeutics and vaccines. But they have failed to back
their assurances with enough money.

7 - A group of developing countries led by India and South Africa sought to increase the supply
of vaccines by manufacturing their own, ideally in partnership with the pharmaceutical companies
that have produced the leading versions. In a bid to secure leverage, the group has proposed that
the World Trade Organization waive traditional protections on intellectual property, allowing poor
countries to make affordable versions of the vaccines.
8 - The W.TO. operates on consensus. The proposal has been blocked by the United States,
Britain and the European Union, where pharmaceutical companies wield political influence. The
industry argues that patent protections and the profits they derive are a requirement for the
innovation that yields lifesaving medicines.

9 - Proponents of suspending patents note that many blockbuster drugs are brought to market
via government-financed research, arguing that this creates an imperative to place social good at
the heart of policy.

10 - “The question is really, ‘Is this a time to profit?’” said Mustaqeem De Gama, councilor at the
South African mission to the W.T.O. in Geneva. “We have seen governments closing down
economies, limiting freedoms, yet intellectual property is seen to be so sacrosanct that this cannot
be touched.”

11 – (…) The production of vaccines is fraught with challenges that could limit supply, while their
endurance and effectiveness are not fully understood. The economic recovery will be shaped by
questions of psychology. After the most profound shock in memory, how will societies exercise
their freedom to move about once the virus is tamed? Will people be liberated from lockdowns
pack together in movie theaters and on airplanes?

12 -Act-Accelerator partnership, known as Covax, is meant to allow poor countries to buy

vaccines at affordable prices, but it collides with the reality that production is both limited and
controlled by profit-minded companies that are answerable to shareholders.

13 - India is home to pharmaceutical manufacturers that are producing vaccines for multinational
companies including AstraZeneca, but its population is unlikely to be fully vaccinated before 2024,
according to TS Lombard, an investment research firm in London. Its economy is likely to remain
vulnerable.

14 -Even if masses of people in poor countries do not gain access to vaccines, their economies
are likely to receive some spillover benefits from wealthier nations’ return to normal. In a world
shaped by inequality, growth can coincide with inequity.