At the end of last week, the European Commission set out a plan to control Covid-19 vaccine exports from the EU, including requiring vaccine makers holding contracts with the bloc to have authorisation to export.

The Commission cites a “lack of transparency” of vaccine exports from the EU as the reason for the measures, which came into effect on January 30 and will apply until the end of March.

The new export control regime mandates information disclosure by Covid-19 vaccine producers that have advanced purchased agreements with the EU and are planning to export their goods.

Initially, the EU had planned to go one step further: it intended to implement a hard border between the Republic of Ireland and Northern Ireland to halt vaccine supplies leaving the bloc and entering the UK via this route. But it made a swift u-turn on this decision after pressure from both sides of the Irish border and the rest of the UK.

The latest version of the implementation document appears to reference the EU’s dispute with British-Swedish vaccine maker AstraZeneca over a shortfall in vaccine supplies.

“Despite the fact that financial support has been given to increase production, certain vaccine manufacturers have already announced that they would not be in a position to supply the quantities of vaccine destined to the union that they had pledged, in potential breach of their contractual commitments,” it reads. “Furthermore, there is a risk that vaccines produced in the union are exported from the union, in particular to non-vulnerable countries.”

AstraZeneca has reported vaccine supply glitches, meaning that the bloc will receive fewer doses than agreed for the first few months of this year.

The pharma company’s chief executive Pascal Soriot said in an interview with Italy’s la Repubblica on January 26: “Of course, we are all very disappointed. We would like to produce more. I think we will deliver to Europe in the month of February a reasonable quantity… but of course, it’s less than expected.”

He added that the EU’s deliveries were in part delayed because the bloc signed its contract three months later than the UK, which gives the latter priority, and so EU manufacturing facilities are still catching up on orders.

However, a redacted August contract between AstraZeneca and the EU published on January 29 states that Brussels may well have been expecting some vaccine deliveries to come from the UK at the start of the year.

Soriot said: “As soon as we have reached a sufficient number of vaccinations in the UK, we will be able to use that site to help Europe as well. But the contract with the UK was signed first and the UK, of course, said ‘you supply us first’, and this is fair enough.”

The bloc is being criticised for its slow vaccine roll out. According to the Our World in Data project based at the University of Oxford, the EU countries that have administered a first vaccine jab to the highest proportion of their populations are Serbia, Malta and Denmark, with 6.4%, 6.3% and 4.7% respectively inoculated. In comparison, the UK has given a first dose of a vaccine to 14.4% of its population.

Meanwhile, some countries in the Middle East appear to be winning the inoculation race, with Israel having administered a vaccine dose to 57.7% of its population and the UAE providing a first inoculation to 34.8% of its citizens, finds the data.


Other governments to follow? 

“To the best of my knowledge, in taking this step the European Union has become the first major trading power to impose export controls on Covid-19 vaccines,” writes Simon Evenett, trade policy analyst and MBA director at the University of St Gallen, in a note on Global Trade Alert.

“Going forward the critical question is whether other governments will impose export control regimes on Covid-19 vaccines, related or essential goods, or take other trade restrictive or punitive measures in response,” he adds.

Evenett points to the first wave of Covid-19 infections last year, where widespread adoption of export curbs on medical goods and medicines were imposed. According to his research, at their peak in the second quarter of 2020, a total of 137 restrictions on foreign shipments of medical goods and medicines imposed by 72 nations were in force.

At the time, World Bank president David Malpass urged leaders against hoarding medical and food supplies, and not to use shortages as a reason to step up protectionist measures.

However, governments will act in their own interests and work to get their populations vaccinated before supporting others, says Rebecca Harding, CEO of Coriolis Technologies.

“What the whole incident has done though, is underscore a latent vaccine nationalism that, if left unfettered, could obstruct the efforts to supply vaccines around the world, and especially to emerging markets in the coming months,” she writes in a blog post.

She tells GTR that it is a situation where the West is squabbling over something that it will ultimately get, because there are enough vaccines being produced and ordered. “Supply will adjust because there’s demand, but it is going to take time because we have never needed to scale the production capacity of something so quickly and so vastly before; it’s a mammoth effort.”

In his note, Evenett puts forward five scenarios of what he believes might happen following the EU’s move: export curbs are introduced along the vaccine supply chain; export controls on vaccines spread; restrictions extend to other essential goods; the EU withdraws the regime; and retaliation is taken against EU multinational companies.

In the scenario that export curbs are introduced along the vaccine chain, the EU could face a shortage of ingredients and related goods imported from outside the bloc, further delaying its vaccine roll out.

In the case that other nations producing vaccines implement export controls, countries relying on the import of various vaccines will be harmed, including many developing nations.

Meanwhile, if the EU withdraws the export control regime, the supply of vaccines to third parties may increase. Otherwise, the status quo would be restored, writes Evenett.