Should covid-19 vaccine donations be counted as oda?

2022

After several months of negotiations, the OECD’s Development Assistance Committee (DAC) reached a consensus to report as ODA the donation of surplus doses of COVID-19 vaccines that were purchased for domestic use only. Once assured that these leftover doses would not be needed, donor countries had two options: either to dispose of them or to donate them.

The main components of the agreement reached by the DAC are:

  • The value of each donated vaccine dose was set at a maximum of US$6.72 (the weighted average price of donated doses delivered to countries through COVAX by the 18th of October 2021).
  • The agreed valuation price will apply only in 2021. It will be reviewed in 2022 in order to establish a valuation price for that year.
  • Vaccine donations can only be reported as ODA disbursements when the recipient country has received the doses.
  • Only donations of vaccines listed by the WHO or approved by a competent and efficient regulatory authority can be counted as ODA.
  • Donated doses should have a shelf life of at least 10 weeks from the time they arrive in the receiving country.
  • Additional costs, such as shipping and syringes, can be reported as ODA under a separate heading.

The reality is that this agreement rewards donor countries for behaviour that is likely to have exacerbated the impact of COVID-19 in the poorest countries. The lack of access to vaccines in many countries is directly related to the hoarding of vaccines by the richest countries, their refusal to recognise COVID-19 vaccines as a global public good, and their refusal to approve exemption of patents on such vaccines. Some countries, including Spain, bought three or more times as many vaccines as they needed to vaccinate their entire population. As a result, they were faced with a major problem in terms of what to do with the huge surplus of vaccines they had, with a not-too-distant expiry date. In fact, by May 2022, Spain had already destroyed 1.4 million doses of COVID-19 vaccine, which, although it represents only 1.43% of the total number of vaccine doses purchased, represented a cost of 9 million euros, and gives an idea of the problem at a global level if we add all the donor countries together. The United States alone had discarded 82 million doses of vaccine by mid-May 2022.

The solution arrived at by governments to, on the one hand, dispose of this surplus, and on the other hand, to avoid having to explain why they had been so inefficient and monopolistic in this pandemic, was to donate the surplus vaccines to countries that were short. In so doing, they were attempting to counteract an image of selfishness and greed with one of solidarity by counting these donations as ODA. As the NGOs of the DAC-CSO Reference Group point out, the vaccines that are now being donated were never purchased with the interests of partner countries in mind, and rewarding these donations undermines the integrity, character and quality of ODA, especially when these same countries had been responsible for the lack of equitable distribution of the vaccines.

The agreed price of US$6.72 per dose for ODA reported in 2021 is, to say the least, debatable, as in some cases it is higher than the price paid. For example, a dose of the AstraZeneca vaccine has an average price of US$4, US$2.72 less than the price counted as ODA.

Although it is true that other vaccines have a higher price, we will need to analyse the final data for 2021 in order to determine which vaccines were most donated and to finally be able to see if what was actually paid for the vaccines has been counted as ODA. For example, according to the Center for Global Development, the UK paid US$4.4 for each dose it now donates, which is US$2.32 below the price agreed by the DAC, which is the price it will report as ODA. This means that the UK's computed ODA for 2021, as well as possibly that of other countries, will be artificially inflated, and the decrease in its ODA would be even more significant than what the official figures show for that year.

In addition, the price of US$6.72 is based on a Gavi reference cost for the purchase of doses and additional costs such as shipping and syringes. However, the DAC agreement allows these additional costs to be counted separately so that, again, we could see an artificial increase in ODA for some countries. It is therefore important that we establish very precise criteria as to how these additional costs should be reported, in order to avoid duplication of accounting.

Finally, the fact that the doses were received by the recipient country does not ensure that they were able to be used. Many of these countries have weak health systems, compounded by logistical problems that may prevent local distribution of these vaccines. In Nigeria, more than one million COVID-19 vaccines had to be disposed of by the end of 2021.

For all these reasons, civil society called for the agreed price to be as low as possible to ensure that dose donations are not overpriced and thus avoid artificially inflating ODA budgets.

Furthermore, mechanisms should be put in place to ensure that DAC members do not declare as ODA more than the original cost of the vaccine doses they donate; unfortunately, the DAC agreement does not include any of these proposals.

Given the likely variability in the quality and types of vaccines counted as ODA, the DAC-CSO Reference Group proposes that the OECD produce an annual report, within three months of the end of the calendar year, in which DAC members and other reporters provide additional information, such as the details of the doses shared, the type, the recipient, the attributed costs and their expiry date. To ensure at least as much transparency as possible, it should continue to be counted as an additional external item, which can be separated from the analysis of the ODA proper.

Using the ODA budget to pay for vaccine doses that were purchased for the donor country and not for impoverished countries, in addition to being unethical, can lead to the diversion of ODA funds that were initially intended for other humanitarian needs. Therefore, vaccine donations must first be part of a joint and comprehensive strategy between donor and recipient countries, and not a one-way policy of fait accompli, taking advantage of the weaknesses of recipient countries. They should take into account measures that ensure their effectiveness, efficiency and impact and should be in addition to existing ODA plans. In no case should they replace ODA that should have been earmarked for new or existing programme and projects.