Biden revives Trump’s Africa business initiative; focus on energy, health

By Doyinsola Oladipo and Andrea Shalal

WASHINGTON (Reuters) -The Biden administration on Tuesday announced a new push to expand business ties between U.S. companies and Africa, with a focus on clean energy, health, agribusiness and transportation infrastructure on the continent.

U.S. industry executives welcomed the interest, but said dollar flows will lag until the administration wraps up its lengthy review of Trump administration trade measures and sets a clear policy on investments in liquefied natural gas.

Dana Banks, senior director for Africa at the White House National Security Council, told a conference the administration planned to “re-imagine” and revive Prosper Africa, an initiative launched by former-President Donald Trump in 2018, as the “centerpiece of U.S. economic and commercial engagement with Africa.”

Travis Adkins, deputy assistant administrator for Africa at the U.S. Agency for International Development (AID), added: “We’re looking at the ways in which we (can) foster two-way trade, looking at mutually beneficial partnerships that work together to mobilize investment, create jobs, and … shared opportunities on both sides of the Atlantic.”

President Joe Biden, who requested nearly $80 million for the initiative in his budget proposal in May, aims to focus it on women and equity, with an expanded role for small- and medium-sized businesses, Banks said.

The administration’s goal was to “reinvigorate Prosper Africa as the centerpiece of U.S. economic and commercial engagement with Africa,” she said.

“This is an area that is a priority both at home and abroad,” Banks told Reuters ahead of the conference, adding that African countries were eager to expand their cooperation with the United States.

U.S. business executives warn the United States is in danger of being overtaken by China and Europe, which are already investing and signing trade agreements across the continent.

“We can’t wait another year to devise an Africa policy; we need to be bold in our thinking,” said Scott Eisner, president of the U.S. Chamber of Commerce’s U.S.-Africa Business Center.

He said many companies had started to eye investments in Kenya given the Trump administration’s talks with Nairobi on a bilateral free trade agreement, but that those plans were on ice until the policy review was completed.

The U.S. Trade Representative’s office had no immediate comment on the status of the review.

Another hurdle is uncertainty about the administration’s policy on LNG projects.

Nigeria and other countries are eager to secure U.S. investment in such plans, but are waiting to see whether the administration will back LNG investments even as it seeks to halve U.S. fossil-fuel emissions.

“We’ve committed as an institution to have over 50% of our investments focused on activities that combat climate change,” said Kyeh Kim, a senior official at Millennium Challenge Corporation, an independent U.S. foreign aid agency, said.

(Reporting by Andrea Shalal and Doyinsola Oladipo; additional reporting by Valerie Volcovici; editing by Tim Ahmann, Gerry Doyle and Dan Grebler)

Delta COVID variant becoming globally dominant, WHO official says

GENEVA (Reuters) – The Delta variant of COVID-19, first identified in India, is becoming the globally dominant variant of the disease, the World Health Organization’s chief scientist said on Friday.

Soumya Swaminathan also voiced disappointment in the failure of CureVac’s vaccine candidate in a trial to meet the WHO’s efficacy standard, in particular as highly transmissible variants boost the need for new, effective shots.

Britain has reported a steep rise in infections with the Delta variant, while Germany’s top public health official predicted it would rapidly become the dominant variant there despite rising vaccination rates.

The Kremlin blamed a surge in COVID-19 cases on reluctance to have vaccinations and “nihilism” after record new infections in Moscow, mostly with the new Delta variant, fanned fears of a third wave.

“The Delta variant is well on its way to becoming the dominant variant globally because of its increased transmissibility,” Swaminathan told a news conference.

Coronavirus variants were cited by CureVac when the German company this week reported its vaccine proved only 47% effective at preventing disease, shy of the WHO’s 50% benchmark.

The company said it documented at least 13 variants circulating within its study population.

Given that similar mRNA vaccines from Pfizer and BioNTech and Moderna posted efficacy rates topping 90%, Swaminathan said the world had been expecting more from CureVac’s candidate.

“Just because it’s another mRNA vaccine, we cannot presume all mRNA vaccines are the same, because each one has a slightly different technology,” Swaminathan said, adding the surprise failure underscored the value of robust clinical trials to test new products.

WHO officials said Africa remains an area of concern, even though it accounts for only around 5% of new global infections and 2% of deaths.

New cases in Namibia, Sierra Leone, Liberia and Rwanda have doubled in the last week, WHO emergencies program head Mike Ryan said, while vaccine access remains miniscule.

“It’s a trajectory that is very, very concerning,” Ryan said. “The brutal reality is that in an era of multiple variants, with increased transmissibility, we have left vast swathes of the population, the vulnerable population of Africa, unprotected by vaccines.”

(Reporting by John Miller, writing by Giles Elgood, Editing by Catherine Evans and Michael Shields)

India’s halt to vaccine exports ‘very problematic’ for Africa

By Giulia Paravicini

ADDIS ABABA (Reuters) – An extended halt to exports of COVID-19 vaccines from India, where authorities are battling a wave of domestic infections, risks derailing vaccination efforts already underway in Africa, one of the continent’s top health officials said on Tuesday.

India stopped vaccine exports a month ago and, according to a Reuters report earlier on Tuesday, is now unlikely to resume major exports before October, dealing a major setback to the global COVAX initiative on which many poor countries rely.

Africa has lagged far behind other regions due to supply issues and meagre financial resources but had planned to vaccinate 30-35% of its population by the end of the year and 60% within the next two to three years.

“This is very problematic as it means unpredictability of our vaccination programs and a serious risk of not achieving our stated target… on time,” the director of the Africa Centers for Disease Control and Prevention, John Nkengasong, wrote to Reuters.

Those targets primarily relied on supplies from the global COVAX vaccine-sharing facility, which has depended heavily on AstraZeneca shots produced by the Serum Institute of India (SII).

“Given India’s huge challenges, it will be impossible to expect anything soon,” Nkengasong said.

There have been at least 4,742,000 reported infections and 126,000 reported deaths caused by the novel coronavirus in Africa so far, according to a Reuters tally.

And while the pandemic’s impact has been less acute than in the United States, Europe and now India, Africa’s largely unvaccinated population of over 1 billion remains vulnerable, experts say.

COVAX had already begun distributing millions of doses of the two-shot AstraZeneca vaccine to countries across Africa. But those initial shipments have now been largely exhausted, with around 80% having been administered as a first dose, according to the World Health Organization (WHO).

Most countries using COVAX will now surpass the 12-week maximum interval recommended between the first and second dose of AstraZeneca unless 20 million doses are delivered by the end of June and another 5 million in July, the WHO said.

“The supply gap could be closed if countries with adequate supplies set aside a percentage of vaccines for COVAX,” said Richard Mihigo, coordinator of the WHO’s Immunization and Vaccines Development Program in Africa.

A deal negotiated with Johnson & Johnson by the African Union should supply Africa with 400 million vaccine doses beginning in the third quarter of this year.

Several countries’ health officials told Reuters they had yet to receive updated information on expected arrival dates for COVAX shots. Some are now weighing their options.

Ethiopia, for example, has received just 2.2 million of the 7.6 million AstraZeneca shots it was due to get through COVAX by the end of April.

“We were expecting some delays, but not to this scale. As a country we must search other options,” Muluken Yohannes, a senior adviser to Ethiopia’s health ministry, told Reuters.

(Additional reporting by Omar Mohammed in Nairobi, Christophe Van Der Perre in Dakar and Camillus Eboh and Felix Onuah in Abuja; Editing by Joe Bavier and Alexandra Hudson)

Nigeria urges U.S. to move Africa Command headquarters to continent

ABUJA (Reuters) – The United States should consider moving its military headquarters overseeing Africa to the continent, from Germany, to better tackle growing armed violence in the region, Nigerian President Muhammadu Buhari said on Tuesday.

Nigerian security forces face multiple security challenges including school kidnappings by armed gangs in its northwest and piracy in the Gulf of Guinea as well as the decade-long insurgency by Islamist militant group Boko Haram, which also carries out attacks in neighboring Niger, Cameroon and Chad.

West Africa’s Sahel region is in the grip of a security crisis as groups with ties to al Qaeda and Islamic State attack military forces and civilians, despite help from French and United Nations forces.

Buhari, in a virtual meeting with U.S. Secretary of State Antony Blinken on Tuesday, said U.S. Africa Command (AFRICOM), should be relocated to Africa itself.

“Considering the growing security challenges in West and Central Africa, Gulf of Guinea, Lake Chad region and the Sahel, weighing heavily on Africa, it underscores the need for the United States to consider re-locating AFRICOM headquarters… near the theatre of operation,” said Buhari, according a statement issued by the presidency.

He spoke a week after the death of the longtime president of Chad, Idriss Deby, in a battle against rebels.

Deby was an important Western ally in the fight against Islamist militants and under him Chadian soldiers formed a key component of a multinational force fighting Boko Haram and its offshoot, which has pledged allegiance to Islamic State.

“The security challenges in Nigeria remain of great concern to us and impacted more negatively by existing complex negative pressures in the Sahel, Central and West Africa, as well as the Lake Chad Region,” said Buhari, a retired major general.

AFRICOM did not immediately respond to a request for comment.

(Reporting by Felix Onuah in Abuja; Additional reporting and writing by Alexis Akwagyiram in Lagos; Editing by Mark Heinrich)

Chad in turmoil after Deby death as rebels, opposition challenge military

By Madjiasra Nako and Mahamat Ramadane

N’DJAMENA (Reuters) – The son of Chad’s slain leader Idriss Deby took over as president and armed forces commander on Wednesday as rebel forces threatened to march on the capital, deepening the turmoil in a country vital to international efforts to combat Islamist militants in Africa.

The political opposition also denounced the military’s takeover of control, calling the move a coup d’etat and rejecting its plan for a transition. Labor unions called for a workers’ strike.

Deby, 68, was killed on Monday on the frontline in a battle against fighters of the Libyan-based Front for Change and Concord in Chad (FACT), a rebel group formed by dissident army officers.

His death shocked the nation and raised concerns among Western allies, notably France and the United States, who had counted on him as an ally in their fight against Islamist groups including Islamic State and Boko Haram.

Deby had been in power since 1990 and had just been declared winner of a presidential election that would have given him a sixth term in office. His son, General Mahamat Idriss Deby, was named interim president by a transitional council of military officers.

General Deby, 37, moved to consolidate his position on Wednesday, with the council issuing a new charter in place of the country’s constitution granting him the functions of president and also naming him as head of the armed forces.

In his first public comments since taking power, Deby said the army wanted to return power to a civilian government and hold free and democratic elections in 18 months.

“The military council has no ambition to govern the country alone,” he said in a speech to political party representatives, posted on the presidency website.

“The Transitional Military Council will work to consolidate democracy, assure peace and stability, guarantee security and the integrity of the national territory.”

The military also announced it had re-opened Chad’s borders, which were closed after Deby’s death.

The FACT rebels rejected the military’s plan and said on Wednesday that a pause in hostilities they are observing to give time for Deby to be buried would end at midnight.

“The forces of national resistance are more than ever determined to deliver the Chadian people from this abominable dictatorship,” they said in a statement.

The statement also warned foreign heads of state against going to Deby’s funeral on Friday “for imperatives of security”. French President Emmanuel Macron plans to attend, a spokesman said on Wednesday.

OVER THE BORDER

A spokesman for FACT – which is not linked to jihadists – said its forces were now in Kanem region about 200-300 km (125-190 miles) north of N’Djamena and their aim was to bring democracy to Chad after years of authoritarian rule by Deby.

The fighters poured over the vast country’s northern border last weekend.

“We don’t want to seize power to hold power. Our objective is for democratic transitions to be a reality,” the spokesman said. He said the group was preparing to march on N’Djamena to “free the people from a system that is undemocratic”.

FACT claimed responsibility for the injuries that killed Deby on Monday. An ex-army officer who often joined soldiers on the battlefront, Deby was visiting troops who had held up the rebel advance in intense fighting over the weekend.

He was wounded by gunfire in the village of Mele near the town of Nokou, more than 300 km (190 miles) north of N’Djamena, and evacuated to the capital where he later died, the FACT spokesman said. The presidency has not commented on the exact circumstances of his death.

Opposition politicians, many of whom boycotted the election, and civil society organisations also called for a return to civilian rule, while a coalition of other armed groups demanded an inclusive national dialogue.

In a joint statement, about a dozen party leaders condemned what they called “the institutional coup d’etat conducted by the generals” and called for a civilian transition.

The main labor organization, the Union of Syndicates of Chad, also rejected the military takeover and called for a strike.

FRENCH FRIENDS

Deby had won friends abroad by sending his well-trained army to fight jihadists including Boko Haram in the Lake Chad Basin and groups linked to al Qaeda and Islamic State in the Sahel.

His main ally, France, has about 5,100 troops based across the region as part of international efforts to fight the militants, including its main base in N’Djamena. The United States also has military personnel there.

Regional powerhouse Nigeria’s foreign minister said it was willing to help facilitate dialogue, but that while an early return to democratic rule was the ultimate goal, the immediate objective was the stabilization of Chad and the region.

Human Rights Watch criticized the West’s relationship with Deby, saying that for years it had propped up Deby’s government while turning a blind eye to his repression. In a statement, it warned of the “potentially explosive consequences” of Deby’s death for Chad and the region.

In N’Djamena, where authorities imposed a nightly curfew after Deby’s death, schools and some businesses were open on Wednesday but many people stayed home and streets were quiet.

A 14-day period of national mourning is being observed.

“We must make sure that this military council does not take over power,” said Djimadoum Ngarteri, a teacher, calling for all sides to lay down weapons. “We Chadians are fed up. We do not need people who take power with weapons.”

(Reporting by Madjiasra Nako and Mahamat Ramadane in N’Djamena, Nellie Peyton, Aaron Ross and Edward McAllister in Dakar, writing by Angus MacSwan, editing by Nick Tattersall, William Maclean)

India AstraZeneca shot delay could be ‘catastrophic’ for Africa: health official

ADDIS ABABA (Reuters) – India’s temporary hold on major exports of AstraZeneca’s COVID-19 shot will undermine Africa’s vaccination plans, and could have a “catastrophic” impact if extended, the head of the continent’s disease control body said on Thursday.

India decided to delay big exports of the shots made in its territory by the Serum Institute of India (SII) to make sure it could meet local demand, two sources told Reuters last week.

The hold “will definitely impact our ability to continuously vaccinate people,” the director of the Africa Centers for Disease Control and Prevention, John Nkengasong, told a news conference in Addis Ababa.

The African Union had planned to vaccinate 30-35% of the continent’s population by the end of the year he said. “If the vaccines are delayed we are unlikely to meet our target,” he added.

That AU target primarily relies on supplies from the global COVAX vaccine-sharing facility, through which 64 poorer countries including many in Africa are supposed to get doses from the SII. COVAX aims to provide enough shots for African countries to inoculate at least 20% of their populations.

“If the delay continues, I hope it’s a delay and not a ban, that would be catastrophic for meeting our vaccinations schedule,” Nkengasong said.

African countries have reported 4.25 million coronavirus infections and 112,000 related deaths, though experts have said the actual numbers could be higher.

The AU has also been negotiating with manufacturers to help member states secure the additional doses they will need to achieve 60% coverage.

On Monday, Johnson & Johnson announced it would supply the AU with up to 400 million doses of its COVID-19 vaccine. Delivery of those doses is due to begin in the third quarter of this year and will continue through 2022.

Those doses are separate from the GAVI/WHO-backed global COVAX facility.

Nkengasong said on Thursday the AU has “pivoted” towards the J&J shot in part as a result of the delay in the delivery of AstraZeneca shots, and also because it is a single-dose shot.

The J&J doses will begin to arrive in June or July, which will ease any shortage caused by the delay in the AstraZeneca doses, Nkengasong said. The gap until the arrival of the J&J doses is a concern, he added.

(Reporting by Addis Ababa newsroom; Writing by Maggie Fick; Editing by Andrew Heavens)

Africa COVID-19 deaths surpass 100,000 after second wave

JOHANNESBURG (Reuters) – Africa’s reported COVID-19 death toll surpassed 100,000 on Friday, a fraction of those reported on other continents but rising fast as a second wave of infections overwhelms hospitals.

The continent’s reported deaths, at 100,354, compare favorably with North America, which has registered more than half a million, and Europe, which is approaching 900,000, a Reuters tally shows.

But deaths are rising sharply across Africa, driven by its southern region, especially economic powerhouse South Africa, which accounts for nearly half. South Africa was ravaged by a second wave caused by a more contagious variant that has jammed up casualty wards.

“The increased number (of infections) has led to many severe cases and some of the countries really found it quite difficult to cope,” Richard Mihigo, coordinator of the immunization program at the World Health Organization’s Africa office, told Reuters.

“We have seen some countries getting to their limit in terms of oxygen supply, which has got a really negative impact in terms of case management for severe cases.”

Mihigo said the rise in deaths was pronounced in countries near South Africa like Zimbabwe, Mozambique and Malawi, raising the possibility that the 501Y.V2 variant identified in South Africa late last year had spread through the southern Africa region – although more genomic sequencing needs to be carried out to prove that.

International aid group Doctors Without Borders (MSF) this month called for urgent vaccine distributions in southern Africa to counter the spread of the new variant, as most African countries have lagged richer Western nations in launching mass vaccination programs.

Reuters data show Africa’s case fatality rate is now at around 2.6%, higher than the global average of 2.3%, and marginally up on the 2.4% rate after the first wave of infections – which at the time compared favorably with other continents.

Experts caution against reading too much into the data – the real toll may be much higher or lower. For instance, South Africa’s excess deaths – deaths considered over-and-above the normal rate – during the pandemic have reached over 137,000, almost three times its official COVID-19 death toll.

Then again, in some cases Africa’s low testing rates could inflate its true case fatality rate (CFR), said Professor Francisca Mutapi, an infectious disease expert at the University of Edinburgh.

“If deaths being registered as COVID-19 deaths are not necessarily contingent on a positive test … as is the case in South Africa, then this can drive up CFR,” she said.

Even with these caveats acknowledged, African countries look like they are struggling with COVID-19 more than last year.

“Are we counting all the deaths on the continent? No … but most people on the continent do know somebody who has died of COVID during this second wave,” Africa CDC director John Nkengasong told reporters last week.

“Hospitals are being overwhelmed due to health systems that are fragile.”

(Reporting by Alexander Winning, Tim Cocks and Wendell Roelf; Writing by Tim Cocks; Editing by Nick Macfie, Angus MacSwan and Jane Wardell)

Not perfect, but saves lives, AstraZeneca says as Africa backs COVID-19 shot

By Pushkala Aripaka and Ludwig Burger

(Reuters) – AstraZeneca’s COVID-19 vaccine is not perfect, but will have a big impact on the pandemic, its chief executive predicted on Thursday, as the drugmaker pledged to double output by April and the African Union gave its backing for the shot.

The two-dose inoculation, developed with Oxford University, has been hailed as a “vaccine for the world” because it is cheaper and easier to distribute than some rivals.

But its rapid approval in Europe and elsewhere has been clouded by doubts over its most effective dosage and interval between doses.

Data at the weekend also showed it was less effective against a fast-spreading variant of the virus in South Africa, prompting the country to pause rollout of the shot, and the company has also been embroiled in a row with the European Union over supply delays.

“Is it perfect? No, it’s not perfect, but it’s great. Who else is making 100 million doses in February?” CEO Pascal Soriot said on a conference call about the vaccine.

“We’re going to save thousands of lives and that’s why we come to work everyday.”

The company said it aimed to produce more than 200 million doses per month by April, double this month’s level as the world tries to tame a pandemic that has killed 2.35 million.

Head of operations Pam Cheng said on the call that the group was working to further expand global capacity and productivity.

AstraZeneca has set a target to produce 3 billion doses this year, with India’s Serum Institute making much of that aimed at poorer nations.

On Wednesday, the company enlisted Germany’s IDT Biologika as a contract manufacturer, but the bulk of IDT’s contribution will only come onstream late next year.

AstraZeneca said it expected much-anticipated data from the U.S. trial of the vaccine before the end of March, and that it was confident the shot offered relatively good protection against severe disease and death for the South African variant. Its disappointing results were against milder cases.

However, after rising to become Britain’s most valuable company last summer, the company has now slipped to sixth, in a move some analysts attribute to doubts over the vaccine.

“In a year or two we will look back and everybody will realize we made a big impact,” Soriot said.

POSTER CHILD

AstraZeneca’s shares were up 0.95% in afternoon trade, paring some earlier gains, after the company forecast a pick up in earnings growth this year on strong demand for its cancer and other new therapies.

It has pledged not to make any money from its COVID-19 vaccine during the pandemic.

It has been a tumultuous week for the drugmaker after South Africa put on hold giving the shot to its citizens, choosing one developed by its U.S. rival Johnson & Johnson instead.

That came after the trial data raised concerns about the AstraZeneca vaccine’s effectiveness on mild symptoms from the more infectious 501Y.V2 variant of the virus dominant in South Africa, which has spread to 41 nations around the world.

Despite that blow, the World Health Organization endorsed the British vaccine on Wednesday and the African Union said it would target its use in countries that have not reported cases of the variant.

Kenya and Morocco are also planning to administer it.

AstraZeneca said it expected 2021 revenues to rise by a low teens percentage and core earnings of $4.75 to $5.00 per share, as it beat expectations for fourth-quarter sales.

The earnings guidance equates to 18-24% growth, after 15% in 2020, but was a little lower than the $5.10 per share analysts were expecting, as the company flagged more spending this year.

The COVID-19 vaccine is not included in the guidance and the company said its sales would be reported separately from the first quarter of 2021.

While public interest is focused on the vaccine, AstraZeneca’s core business of diabetes, heart, kidney, and cancer medicines has been steadily growing, helping the company to turn around years of decline.

“The company is arguably the poster child for big pharma turnarounds,” said Third Bridge senior analyst Sebastian Skeet.

(Reporting by Pushkala Aripaka and Ludwige Burger. Editing by Josephine Mason and Mark Potter)

Africa secures 400 million more COVID-19 vaccine doses

By George Obulutsa

NAIROBI (Reuters) – The African Union (AU) has secured another 400 million doses of the AstraZeneca COVID-19 vaccine, a regional health leader said on Thursday, in a push to immunize 60% of the continent’s population over three years.

As richer nations race ahead with mass immunization campaigns, Africa is scrambling to obtain supplies for its 1.3 billion people. Only a handful of African nations have begun giving doses.

John Nkengasong, director of the AU’s disease control and prevention body, told an online briefing that in addition to 270 million doses previously secured, the bloc would get 400 million shots from the Serum Institute of India (SII) – all AstraZeneca/Oxford University shots.

A spokesman for the SII declined comment.

The AstraZeneca vaccine is the cheapest option and one of the best-suited to African health systems as it does not require storage at ultra-low temperatures like the vaccine from Pfizer and German partner BioNTech.

Separately from the AU’s efforts, Africa is to receive about 600 million vaccine doses this year via the COVAX facility co-led by the World Health Organization (WHO).

Health authorities hope to vaccinate about 30-35% of Africans this year, rising to 60% in two to three years. The AU has said vaccines secured by its vaccine task team will be allocated according to population.

Though COVID-19 has not hit Africa as badly as some experts had feared it would, wealth disparities, logistical difficulties and “vaccine nationalism” by developed nations may put the world’s poorest continent at a disadvantage.

Africa has reported 3.5 million infections and 88,000 deaths, according to a Reuters tally. That is fewer fatalities than individual nations the United States, Brazil, India, Mexico and Britain.

OUTLIER TANZANIA

In an implicit rebuke to Tanzanian President John Magufuli, who has discouraged mask-wearing and social distancing, discontinued data publication and called vaccines a malign foreign plot, WHO Africa director Matshidiso Moeti urged Tanzania to implement such measures, prepare vaccinations and share data. “Africa is at a crossroads and all Africans must double down on preventive measures,” she told an online news conference on Thursday, saying WHO officials were in touch with Tanzanian officials. “Science shows that vaccines work.”

Magufuli’s government has published no coronavirus data since May 8, when the country had 509 cases and 21 deaths.

On Wednesday, he said, without evidence, that vaccines were a foreign plot to spread illness and steal Africa’s wealth. He urged Tanzanians instead to trust God and use alternative remedies such as steam inhalation.

“We in Tanzania managed to stay for a year without corona. Even here, no one has put on a mask. Our God is beyond Satan and Satan will always fail using different diseases,” he said in a speech in his western home area.

Nkengasong said the Africa CDC was exploring obtaining more vaccines from China, Russia and Cuba, and would work with any partner whose vaccine was safe and effective.

(Reporting by George Obulutsa, Nairobi newsroom and Alexander Winning; Writing by Andrew Cawthorne; Editing by Alex Richardson and Frances Kerry)

WHO vaccine scheme risks failure, leaving poor countries no COVID shots until 2024

By Francesco Guarascio

BRUSSELS (Reuters) – 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, internal documents say.

The World Health Organization’s COVAX program 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 program is struggling from a lack of funds, supply risks and complex contractual arrangements which could make it impossible to achieve its goals.

“The risk of a failure to establish a successful COVAX Facility is very high,” says an internal report to the board of Gavi, an alliance of governments, drug companies, charities and international organizations that arranges global vaccination campaigns. Gavi co-leads COVAX alongside the WHO.

The report and other documents prepared by Gavi are being discussed at Gavi’s board meetings on Dec. 15-17.

The failure of the facility could leave people in poor nations without any access to COVID-19 vaccines until 2024, one of the documents says.

The risk of failure is higher because the scheme was set up so quickly, operating in “uncharted territory”, the report says.

“Current risk exposure is deemed outside of risk appetite until there is full clarity on the size of risks and possibilities to mitigate them,” it says. “It therefore requires intensive mitigation efforts to bring the risk within risk appetite.”

Gavi hired Citigroup last month to provide advice on how to mitigate financial risks.

In one Nov. 25 memo included in the documents submitted to the Gavi board, Citi advisors said the biggest risk to the program was from clauses in supply contracts that allow countries not to buy vaccines booked through COVAX.

A potential mismatch between vaccine supply and demand “is not a commercial risk efficiently mitigated by the market or the MDBs,” the Citi advisors wrote, referring to multilateral development banks such as the World Bank.

“Therefore it must either be mitigated through contract negotiation or through a Gavi risk absorption layer that is carefully managed by a management and governance structure.”

Asked about the documents, a Gavi spokesman said the body remains confident it can achieve its goals.

“It would be irresponsible not to assess the risks inherent to such a massive and complex undertaking, and to build policies and instruments to mitigate those risks,” he added.

The WHO did not respond to a request for comment. In the past it has let Gavi take the lead in public comments about the COVAX program.

Citibank said in a statement: “As a financial advisor, we are responsible for helping Gavi plan for a range of scenarios related to the COVAX facility and supporting their efforts to mitigate potential risks.”

SUPPLY DEALS

COVAX’s plans rely on cheaper vaccines that have so far yet to receive approval, rather than vaccines from frontrunners Pfizer/BioNTech and Moderna that use more expensive new mRNA technology. The Pfizer vaccine has already been approved for emergency use in several countries and deployed in Britain and the United States, and the Moderna vaccine is expected to be similarly approved soon.

COVAX has so far reached non-binding supply agreements with AstraZeneca, Novavax and Sanofi for a total of 400 million doses, with options to order several hundred million additional shots, one of the Gavi documents says.

But the three companies have all faced delays in their trials that could push back some possible regulatory approvals to the second half of 2021 or later.

This could also increase COVAX’s financial needs. Its financial assumptions are based on an average cost of $5.20 per dose, one of the documents says.

Pfizer’s vaccines costs about $18.40-$19.50 per dose, while Moderna’s costs $25-$37. COVAX has no supply deals with either of those firms. Nor is it prioritizing investment in ultra-cold distribution chains in poor countries, necessary for the Pfizer vaccine, as it still expects to use mostly shots which require more conventional cold storage, one of the Gavi documents says.

On Tuesday a WHO senior official said the agency was in talks with Pfizer and Moderna to include their COVID-19 vaccines as part of an early global rollout at a cost for poor countries possibly lower than current market prices.

Other shots are being developed worldwide and COVAX wants to expand its portfolio to include vaccines from other companies.

Rich countries, which have booked most of the currently available stocks of COVID-19 vaccines, are also planning to donate some excess doses to poor countries, although is not clear whether that would be through COVAX.

FINANCIAL PRESSURE

To meet its target of vaccinating at least 20% of people in poor countries next year, COVAX says it needs $4.9 billion in addition to $2.1 billion it has already raised.

If vaccine prices are higher than forecast, supply is delayed or the additional funds are not fully collected, the facility faces the prospect of failure, the documents say.

So far Britain and European Union countries are the main donors to COVAX, while the United States and China have made no financial commitments. The World Bank and other multilateral financial institutions are offering cheap loans to poor countries to help them buy and deploy vaccines through COVAX.

The facility is issuing vaccine bonds which could raise as much as $1.5 billion next year if donors agreed to cover the costs, one of the Gavi documents says. COVAX is also receiving funds from private donors, mainly the Bill and Melinda Gates Foundation.

But even under the best financial conditions, COVAX could still face failure, because of disproportionate financial risks caused by its complex deal-making process.

COVAX signs advance purchase contracts with companies on vaccine supplies that need to be paid for by donors or receiving countries that have the means to afford them.

But under clauses included in COVAX contracts, countries could still refuse to buy pre-ordered volumes if they prefer other vaccines, or if they manage to acquire them through other schemes, either faster or at better prices.

The facility could also face losses if countries were not able to pay for their orders, or even if herd immunity were developed too quickly, making vaccines no longer necessary, the Citigroup report said. It proposed a strategy to mitigate these risks including through changes in supply contracts.

(Reporting by Francesco Guarascio @fraguarascio; Editing by Peter Graff)