$335m loan being secured for vaccines
The government is negotiating with multilateral institutions to secure a $335 million loan for the procurement of Covid-19 vaccines but the money cannot be spent on buying Chinese-origin vaccines.
The government has approached the World Bank and the Asian Development Bank for getting loans to procure the vaccines, according to the Ministry of Economic Affairs officials.
The ADB has been requested to provide $200 million loan out of $500 million that it indicated to give to Pakistan for vaccine procurement.
Pakistan has also negotiated a $135 million loan that the Washington-based lender would divert from the $200 million troubled project.
In November last year, the WB had paused implementation of the $200 million coronavirus contagion mitigation project due to failure of the federal and provincial governments to put in place effective mechanisms for strengthening health systems.
In order to fill the capacity gaps, the project had been undertaken to procure equipment and consumables for 200 hospitals, including 44 tertiary-level hospitals, for effective clinical management of the confirmed cases.
However, the WB and the ADB loans cannot be used to procure the Chinese-origin vaccines, which are so far available to Pakistan, according to sources.
Sources say that the Chinese vaccines do not meet the financial eligibility criteria set by the ADB and the WB.
There are three broad criteria: the vaccines must be selected through the Gavi-funded Covax programme, approved by the World Health Organization and authorized by the European regulatory authorities.
The three Chinese origin vaccines, Sinovac, Sinopharm and CanSino are not eligible for WB and the ADB funding. The Sinovac has begun discussions to join the Covax but no timeline is yet given.
Asad Umar, the chairman of the Vaccine Procurement Committee and federal minister for planning, said that Pakistan has taken up the issue of exclusion of the Chinese-origin vaccines from the financing criteria with the WHO.
The minister said that not financing but the availability of vaccines was a matter of concern for Pakistan.
He said the federal cabinet has already approved $150 million for vaccine procurement and out of that $90 million will be provided by the Islamic Development Bank.
The government has already given orders for procurement of six million vaccines, which will arrive till May, Umar said. He noted that the country has already received one million doses while another two million doses will arrive next week.
The suppliers have indicated providing two million more doses that will arrive by June and sufficient funds are available for these procurements, Umar said.
The government wanted to vaccinate 70% of its eligible population or 69.6 million people. As per the health ministry, only 99.5 million of the population is eligible for the Covid-19 vaccination.
Out of 69.6 million, about 56 million would be vaccinated by taking grant from Gavi and China and a loan from the World Bank.
The vaccination drive has remained very slow and so far about 1.3 million people have been given jabs, including those who purchased vaccines from the private suppliers.
The World Bank and ADB have offered loans to low and middle income countries to procure vaccines.
Kamran Baloch, Pakistan’s Executive Director in the WB said that the WB-funded PREP was currently undergoing a restructuring to help the government purchase and deploy safe and effective Covid-19 vaccines that meet the World Bank’s Vaccine Approval Criteria.
He said that the WB financing will help vaccinate 4.5% of the country’s population (estimated 10.5 million people), while other bilateral and multilateral partners and the Covax Advance Market Commitment facility will support the government cover 25.2% of the population by the end of 2021 calendar year.
Pakistan was also one of the first countries to have availed the G20 Debt Service Suspension Initiative (DSSI). The World Bank and the International Monetary Fund urged G20 countries to establish the DSSI to help countries concentrate their resources on fighting the pandemic and safeguarding the lives and livelihoods of millions of the most vulnerable people.
The first phase of the DSSI and its extension to end 2021 has provided Pakistan temporary fiscal space of approximately $3.5 billion, which enabled the government to increase spending on safety nets.