EU’s ‘morally reprehensible’ vaccine move sparks fears of international crisis

Boris Johnson confirms 15 million vaccines have been given

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At the end of last month, the European Commission decided to temporarily restrict exports of vaccines produced in the EU after a dispute with AstraZeneca about supplies to member states. The Commission claimed it had invested in the development process and was concerned about the way some manufacturers were handling orders. The move came after AstraZeneca told Brussels it would not have been able to supply as many jabs as expected to EU countries in the immediate term.

The temporary restrictions ultimately mean that, for the next few months, in many cases, express authorisation will need to be requested from the member state, in which a vaccine is manufactured before it can be exported.

On the basis of the “principle of solidarity”, various low and middle-income countries, as well as certain favoured partners in Europe, the Middle East and North Africa, are exempted from this regulation.

This is because, in the words of the regulation, “the single market for medical products is closely integrated beyond the boundaries of the union” – meaning supply chains for medicines spread beyond the border of the EU to its neighbours and trading partners, too.

However, the decision still remains controversial on many fronts.

A Canadian government source recently told the Toronto Star that the EU’s new checks had hampered the delivery of Moderna supplies to countries such as Canada.

While Canadian Trade Minister Mary Ng said the government had received verbal reassurances from Brussels, the lack of a formal guarantee has caused concern.

In an exclusive interview with Express.co.uk, Prime Minister Boris Johnson’s trade adviser has shed light on the export restrictions, arguing there will be dire consequences for the entire world.

Mr Singham explained: “It is morally reprehensible because when a major entity does something like this, it sets the tone for everybody else.

“What are other countries going to do when the EU has an export ban?

“They might have to do the same thing themselves.”

He noted the problem with export restrictions is that it damages the flow of trade, the global supply chains and the welfare of the economy but also hits “the poorest of the poor” twice.

The trade expert added: “You deny them access to the product itself and then, the resulting economic wealth disruption pushes everyone into poverty.

“And if you are poor to begin with, being pushed into poverty can often be the difference between life and death.

“So if you think about 40,000 people in Africa die each day from starvation.

“This sort of decision turns that number from 40,000 to 60,000.

“These are the real world impacts from this kind of policy.”

Simon Evenett, Professor of International Trade at the University of St. Gallen, echoed Mr Singham’s claims, arguing Brussels’ decision to adopt export controls could spiral out of control.

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He wrote in a recent report: “If the widespread adoption of export curbs on medical goods and medicines during the first wave of COVID-19 infections is anything to go by, then one must contemplate scenarios where other governments follow the European Commission and take restrictive measures.

“To recall, at their peak in the second quarter of 2020 a total of 137 curbs on foreign shipments of medical goods and medicines imposed by 72 nations were in force.

“Arguably, COVID-19 has greater political salience than face masks and other personal protective equipment, a statement that in no way diminishes the importance of the latter in these fraught times.

“In identifying options that the trading partners of the European Union could potentially contemplate, it is worth noting that at present a limited number of countries manufacture and export COVID-19 vaccines. This is in contrast to the large number of governments seeking to secure vaccines for their populations.”

Evidently, one option available to nations with COVID-19 vaccine manufacturers, Prof Evenett noted, is to introduce some form of export control of their own, compounding “the disruption likely to follow from the EU’s measure”.

He added: “Governments of other nations may consider limiting exports of ingredients and equipment needed to manufacture, store, or distribute COVID-19 vaccines or confiscate vaccines in transit. In short, vaccine nationalism could spread along the COVID-19 vaccine supply chain.

“For governments whose manufactures neither produce COVID-19 vaccines nor associated ingredients and distribution items, two other options exist. The first is to curb the export of other essential goods, such as food, energy, medical goods, medicines, or reagents, to the nations which can export COVID-19 vaccines, for use domestically or for diplomatic leverage.

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“The second is to take action against the foreign affiliates of trading partners that have impeded the export of COVID-19 vaccine.

“European multinationals could be hit by discriminatory taxes and regulations or by revocation of their intellectual property, examples of so-called cross-retaliation for which there are precedents in the disputes brought to World Trade Organisation.”

He concluded in his piece for VoxEU.org: “Given the centrality of intellectual property to the business models of Europe’s successful companies operating internationally, the potential for such cross-retaliation ought to be a first-order concern in European boardrooms. “

According to a study by the International Chamber of Commerce published last month, vaccine nationalism could cost the world economy $9.2trillion (£6.7trillion).

The study claims to clearly demonstrate the economic case to invest in “the Access to COVID-19 Tools (ACT) Accelerator” – the global collaboration to accelerate the development, production, and equitable access to coronavirus tests, treatments, and vaccines.

Dr Tedros Adhanom Ghebreyesus, Director-General of the World Health Organisation (WHO), said: “I believe the world faces a catastrophic moral failure in equal access to the tools to combat the pandemic. This research shows a potentially catastrophic economic failure. The progress made by the ACT Accelerator shows solidarity in beating this virus.

“The longer we wait to provide vaccines, tests, and treatments to all countries, the faster the virus will take hold, the potential for more variants will emerge, the greater the chance today’s vaccines could become ineffective, and the harder it will be for all countries to recover.

“Truly, no one is safe until everyone is safe.”

One of the study authors, Ṣebnem Kalemli-Özcan – Neil Moskowitz Endowed Professor of Economics and Finance at the University of Maryland, College Park – added: “No economy can fully recover until we have global equitable access to vaccines, therapeutics and diagnostics.

“The path we are on leads to less growth, more deaths, and a longer economic recovery.”

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