Monolith assesses that, for much of 2021, a majority of countries are likely to continue to depend on securing supply of externally developed (and, in many cases, externally manufactured) coronavirus disease 2019 (COVID-19) vaccines. Some countries will aim to offset this risk by accessing vaccines from diverse sources, including pooled procurement schemes such as the World Health Organization (WHO)-supported COVID-19 Vaccine Global Access Facility (COVAX) framework. Others are likely to become overly reliant on a narrower supply chain, opening the door for “vaccine diplomacy”, whereby countries that have invested in vaccine innovation and production will compete to be pivotal suppliers to vaccine importers to express and expand their soft power.
Despite a politicized registration process and current manufacturing bottlenecks, Russia is actively capitalizing on its COVID-19 vaccines’ technical innovation to advance its diplomatic objectives abroad. As of 30 March 2021, Russia’s Sputnik V had received emergency use authorization, or full authorization for use, by 58 countries. Russia is particularly targeting Sputnik V for less developed countries that would otherwise not be able to procure Western vaccines until 2022–23 because of supply-chain issues and financial constraints. For example, in February 2021 Russia offered 300 million Sputnik V vaccines to be eventually delivered to the African Union’s member states. By doing this, Russia is seeking to boost positive sentiment for itself in the target countries to gain access to their markets across various sectors, from pharmaceuticals to infrastructure, food, and energy. For countries closer to Russia’s traditional orbit – post-Soviet states including Belarus, Kazakhstan, Kyrgyzstan, and Uzbekistan – vaccine supplies reinforce existing political and economic alliances.
In the European Union, Russia is seeking to use its vaccine supply to create new divisions and widen existing divisions between member states, and to build closer political ties with those member states willing to procure its vaccine without EU authorization. The Russian Direct Investment Fund (RDIF) has applied to the European Medicines Agency (EMA) to register the Sputnik V vaccine for use in the EU, but the application was still under review at the time of writing. Without waiting for EMA approval, in March 2021, Slovakia went ahead with procuring an initial batch of 200,000 doses of Sputnik V vaccine, with another 1.8 million doses scheduled for delivery by June. Russia is likely to seek to leverage the diplomatic gains with Slovakia to drive uptake of Sputnik V in other individual EU countries, such as Greece, Italy, or Hungary. In exchange for Sputnik V access, Russia is likely to pursue new investment contracts and lobbying efforts to ease existing EU sanctions against it.
Perceived lower urgency in domestic distribution is likely to allow China to leverage its advantage as a major vaccine producer to advance strategic targets abroad. China’s relatively slow domestic inoculation process compared with other vaccine-producing countries such as the United States and United Kingdom, despite a high production capacity, likely reflects a strategic decision by the central government to favor distributing vaccines abroad, especially in developing countries, at the cost of longer periods of domestic lockdown. The option to slow down domestic vaccine distribution is likely to be partially due to China’s effective COVID-19-virus response in 2020, when stringent quarantine, testing, and tracing mechanisms led to a sharp drop in case numbers. In September 2020, Chinese President Xi Jinping celebrated “major strategic achievements” in controlling the COVID-19 virus, emphasizing the political priority of containing domestic outbreaks, which at the time largely depended on lockdown measures.
China’s government is likely to expand domestic vaccine production and delivery capabilities further as part of an effort to position itself as a key player in global healthcare supply-chain operations. President Xi announced in May 2020 at the World Health Organization (WHO)’s World Health Assembly that China seeks to provide COVID-19 vaccines as a “global public good”, highlighting the political goal of making China a leader in vaccine provision. To meet this goal, Chinese regulatory authorities have accelerated the approval process for vaccine manufacturers to expand production capabilities. To minimize delivery bottlenecks, China’s airlines and logistics companies have prioritized the expansion and usage of their facilities, such as temperature-controlled buildings, for the storage and transportation of vaccines. The expansion of China’s vaccine production and delivery capabilities internationally serves the development of a “Health Silk Road” and “Digital Silk Road”. China has recently launched a COVID-19 vaccine passport and contact-tracing system, which favors the use of Chinese-made vaccines. Successful vaccine distribution will likely further benefit China’s Belt and Road Initiative, which saw several projects disrupted at the onset of the COVID-19 outbreak in 2020. For instance, with the Philippines and Indonesia, two important countries in the Maritime Silk Road, China linked the provision of COVID-19 vaccines with new infrastructure development initiatives (agreements to supply vaccine to the Philippines have been accompanied by loan pledges and grants for infrastructure projects) and acceleration of existing projects (such as the Jakarta-Bandung railway).
Sub-Saharan African countries tend already to have strong political and commercial ties with the countries from which they are receiving vaccines. Concerns around the slow rollout of vaccines under pooled procurement schemes such as COVAX have prompted some sub-Saharan African countries to make bilateral agreements with vaccine-producing countries like China, Russia, and India. For instance, Guinea approved the Russian Sputnik V vaccine for emergency use in January 2021; President Alpha Condé has fostered strong ties with Russia and many Russian companies operate in Guinea’s iron ore sector, reportedly receiving preferential treatment from Guinea’s government. China’s ambassador to the Republic of the Congo announced that China would donate 100,000 vaccine doses on 4 February, the first batch of which arrived on 10 March. China has extensive commercial interests in the Republic of the Congo, reportedly holding around one-third of the country’s national debt. Chinese national oil company CNOOC also holds offshore blocks in the Republic of the Congo and state-owned Chinese construction firms carry out most major infrastructure projects in the country, such as the expansion of the Pointe-Noire port.
China has used vaccine donation as a tool to capitalize on rivals’ deteriorating bilateral ties in sub-Saharan Africa. The death on 20 January of General Sibusiso Moyo, a key Western ally within Zimbabwe’s government, precipitated Zimbabwe reversing policy decisions sought by the United States as conditions to lift economic sanctions. On 15 February, Zimbabwe’s health ministry stated that 200,000 doses of the Sinopharm vaccine had been delivered to the government, donated by China. President Emmerson Mnangagwa stated that Zimbabwe would buy a further 1.8 million doses from China. The delivery of vaccines is likely to encourage Zimbabwe to further consolidate commercial relations with China, particularly in the mining and construction sectors. China has also donated COVID-19 vaccine doses to neighboring Namibia, where China is probably seeking to curb anti-Chinese sentiment that resulted in sporadic xenophobic attacks on Chinese individuals and their businesses between 2015 and 2019.
Latin America’s reliance on external vaccine supply is likely to continue driving procurement relationships with an expanded set of exporters in addition to traditional partnerships with the US and Europe. Latin America does not yet have any locally developed COVID-19 vaccines ready for use and remains wholly dependent on externally sourced vaccines. The lack of domestic capacity has made the region vulnerable to supply shortages, with almost every country experiencing delays to vaccination programmes to date, except Chile. These supply delays have generated an increasing openness in most of the region to sourcing vaccines from as many available suppliers as possible, in order to accelerate deliveries and reduce exposure to supply disruption from any one source. As of mid-December 2020, only three countries in the region – Argentina, Brazil, and Mexico – had confirmed APAs for Russian or Chinese vaccines, with the majority prioritizing agreements with US and European manufacturers. However, from January 2021, supply delays accelerated the diversification of vaccine sourcing in the region; as of the end of March 2021, most countries had agreements for Russia’s Sputnik V vaccine and/or China’s CoronaVac, CanSino, or Sinopharm vaccines – in Peru, Chile, and Argentina, these make up the majority of total contracted doses. Several Latin American governments have highlighted supply advantages of the Russian and Chinese vaccines, including reported lower prices, greater availability, and more rapid access. Mexico has openly criticized vaccine “hoarding” among more developed Western nations for restricting available supplies and the COVAX mechanism for failing to provide expected vaccine access.
Chinese and Russian vaccines are likely to make up the majority of supply in the Middle East and North Africa (MENA), facilitating diplomatic and trade outreach with each of these states. Several MENA states have been involved in vaccine research and development (R&D), while a wider group of states has the potential for domestic manufacturing capabilities. Despite these capacities, the MENA region is likely to remain heavily reliant on external vaccine suppliers. In response, MENA countries have become open to accessing COVID-19 vaccines from diverse sources to balance the risk of supply shortages and delays, including through the COVAX framework (mostly AstraZeneca vaccines) and bilateral arrangements. Western-developed vaccines, such as the Pfizer/BioNTech vaccine, have been used extensively in Israel and the Gulf, but the majority of vaccine supplies for most of the rest of the MENA region are likely to be sourced from China and Russia, given their comparative lower costs and relatively simple storage requirements. Chinese pharmaceutical companies have established a presence in the MENA region through proposing clinical trials of vaccines in exchange for advanced or expedited access to vaccines. Egypt, Jordan, Morocco, Saudi Arabia, and Turkey are participating in vaccine trials of products developed by Chinese pharmaceutical companies Sinopharm, Sinovac, and CanSino. This is likely to facilitate the further expansion of Chinese vaccine manufacture in MENA in the two- to three-year outlook, and given the overlap in sharing of medical data and computing capacity, this is likely to extend into further investment opportunities for Chinese companies in telecommunications, Artificial Intelligence development, and the development of logistics infrastructure.