Nepal talks about vaccines from China. And the Chinese are not happy
From Prime Minister KP Sharma Oli to Foreign Minister Raghubir Mahaseth, who is also a deputy prime minister, to Nepali embassy in Beijing—all are giving statements about the Nepal government’s plan to buy vaccines from China’s Sinopharm, 4 million doses in total. But the Chinese do not seem to be happy.
Multiple officials the Post spoke to confirmed that China communicated its displeasure to Nepali agencies. The officials told the Post that Sinopharm had communicated its displeasure at the publicisation of vaccine procurement by the government of Nepal. Similarly, the Chinese embassy in Kathmandu also had reminded the Ministry of Foreign Affairs of the nature of the deal, according to the officials.
“There was quite a lot of interest in the media before an agreement could be reached, which worried us. We were worried if we would get the vaccine or not,” Dr Krishna Prasad Paudel, spokesperson for the Health Ministry, told the Post. “The way the media quoted the price of the vaccine and other logistical issues was concerning because these are very sensitive issues.”
The Health Ministry on Thursday issued a statement, refuting reports about buying vaccines from China. It not only said no deal had been reached but also went on to blame the media for disseminating information on vaccine procurement from China.
The Post on Wednesday reported first that the government is buying 4 million doses from Sinopharm under a non-disclosure deal as proposed by China’s state-owned vaccine manufacturing firm. Some Nepali online portals later followed up the story.
In what was quite unusual on the part of the ministry, it issued the statement in English.
“The government of Nepal has requested the government of the People’s Republic of China to give preference to Nepal on vaccine cooperation. The process to secure
vaccines from different countries including China is still ongoing,” read the statement. “Media reports on quantity, price, delivery, and other relevant information about the vaccine procurement are premature, speculative and misleading. The ministry refutes such unfounded and baseless media reports.”
The Post’s story was based on confirmation from two ministers and two government secretaries who were present at Monday’s Cabinet that decided to procure 4 million doses of vaccine from Sinopharm. The Post reported that the price was yet to be fixed given the nature of the agreement, but as per officials, it could be around $10 per dose.
“Since it was mostly reported by the English media, we issued the statement in English,” Dr Samir Kumar Adhikari, joint spokesperson for the ministry who signed the statement, told the Post on Friday. He refused to elaborate.
Ever since the coronavirus second wave hit the country, the government has been scrambling for vaccines. After India, on which the government was over-reliant for the jabs, put a ban on vaccine exports in the wake of its own coronavirus crisis, the government was looking to China as well as other countries to procure the shots.
Buying vaccines from China, however, was easier said than done given the non-disclosure agreement proposal by Sinopharm. A non-disclosure agreement entails not quoting the price of the commodity, quantity in advance and mode of payments among other details.
But after failing to acquire vaccines, the Cabinet on Monday approved the Health Ministry’s proposal to buy 4 million doses from Sinopharm.
The same day Prime Minister Oli informed the Covid-19 Crisis Management Centre, which he heads, about procuring the vaccine from China. Similarly, on Wednesday, Foreign Minister Mahaseth told a TV channel that the government is buying 4 million doses of Sinopharm vaccine from China.
Many find the Health Ministry statement, blaming the media for disseminating information about the vaccine, uncalled for, as the prime minister and foreign minister themselves were discussing the matter publicly.
Officials admitted that the statement followed concerns from the Chinese.
An official at the Health Ministry who did not wish to be named said there was pressure from “higher ups” to issue the statement.
An official at Chinese embassy in Kathmandu confirmed to the Post that Sinopharm had taken note of several media reports about the vaccine deal, provisions of non-disclosure agreement, price and logistics with the Ministry of Foreign Affairs.
“We also reminded the Ministry of Foreign Affairs of the ‘commercial process agreement’,” the Chinese embassy official told the Post over the phone. “Both sides should follow the due process of the agreement after its signing.”
According to the official, a non-disclosure agreement is normal international practice.
“Several other vaccine manufacturing companies [have] also signed similar agreements with many countries. Why has this become an issue in Nepal?” said the official. “Now, no one should interfere with this deal signed between the Sinopharm and Nepal’s Health Ministry. Negotiations are ongoing between the Health Ministry and Sinopharm on how to deliver vaccines in different tranches... or in months and quantities.”
Non-disclosure agreements on vaccine procurement have been an issue globally, as in such deals, among many other items, the price is confidential. Such agreements are very much in practice in many countries. However, in Nepal’s case, a non-disclosure agreement is barred by the country’s procurement law.
Experts on public procurement told the Post last month that the existing law barred any non-disclosure agreement to ensure transparency. Though the government has introduced a “sunset law” to ease the procurement process in view of the Covid-19 crisis, it does not speak about the non-disclosure agreement.
Vaccine deal with Sinopharm, however, has stoked controversy in other South Asian countries as well.
In Bangladesh, after the price was disclosed, the country’s finance ministry had issued a statement similar to the one issued by Nepal’s Health Ministry.
According to the Daily Star, the Bangladesh government on May 27 approved the proposal of procuring 15 million doses of Sinopharm vaccine from China. An official of the Cabinet division at a briefing told journalists that the government was going to procure each dose at $10.
After the media reported about the vaccine procurement, a finance ministry official, according to the paper, requested the media not to mention the price for the “greater interest of the country”. The same paper, earlier this month, reported China was annoyed with Bangladesh for making public the price of the vaccine.
“China is a little upset that the procurement price of the Sinopharm vaccine was made public in Bangladesh,” said Bangladesh Foreign Minister AK Abdul Momen.
Disclosure of procurement price of Sinopharm vaccine had also sparked controversy in Sri Lanka last month, after reports suggested that the government was set to pay $5 more for per dose compared to Bangladesh.
There was a similar displeasure from China at how the price was being made public in Nepal, according to a senior government official.
“Everyone is giving interviews–from the prime minister to our ambassador in China to ministers and officials—and they are discussing everything about the vaccine procurement. This definitely affects the business of Sinopharm because it has different kinds of business strategies with different countries,” the official, a joint secretary at the Prime Minister’s Office familiar with the Chinese concerns, told the Post. “This is a legally binding agreement. But look at our top officials. They are happily discussing the price, quantity and the money for logistics. The [Health Ministry] statement was issued in view of such speculations.”
The Chinese embassy did not hesitate to say that the manufacturing firm is not happy at the disclosure of the price in Nepal.
“Sinopharm is not happy with some media reports in Nepal, particularly about the price of the vaccine at which it is going to sell to Nepal,” said the embassy official who spoke on condition of anonymity. “If you have signed the agreement, you should follow it, and should not disclose it.”
The Chinese official’s statement, however, clearly contradicts what Nepali officials are saying–that the agreement is yet to be signed.
A Health Ministry official told the Post that reports about buying Sinopharm vaccines preceded the agreement, after information “was leaked” to the media.
“The Cabinet has approved the proposal to buy the vaccine and has decided to sign a non-disclosure agreement for the same,” said the official requesting anonymity. “But the agreement is yet to be signed. We are still in the process to sign the deal for the vaccine import, but information was leaked long before any progress could be made.”
During the interview with the Post, the Chinese embassy official also tried to explain why disclosure of the price and other related information is a cause for concern for the manufacturing company.
According to the official, since negotiations are underway with various other countries too, such disclosure can affect the company’s business and credibility.
“We know it’s taxpayers’ money but let’s view it from a different angle,” said the official. “Such revelations of the price and other facts and figures could hamper negotiations with other countries. We also understand the problem Nepal is facing, but if you want the vaccine, you should follow the agreement.”
Amid a deepening vaccine crisis in Nepal, any government plan or decision to procure the jabs from any company or firm generates immense interest among the media and the public.
After China provided an additional 1 million doses of Sinopharm vaccine earlier this month—after supplying 800,000 doses in March—the government plan to procure more doses from the north is a welcome move, but secrecy in the deal is a cause for concern, people well-versed on Nepal’s public procurement say.
“There should not be any ifs or buts when it comes to buying the vaccine. This should be the topmost priority of the government,” Shanta Raj Subedi, a former finance secretary, told the Post. “But the government should make a clear statement that procurement is being done under a ‘government-to-government’ deal without the involvement of any middleman. But the government does not seem to have learned a lesson from the past mistakes and controversies.”
According to Subedi, there are rare incidents in which Nepal has signed a non-disclosure agreement with any firm.
Subedi agrees that misinformation and dissemination of half-baked information could spoil any vaccine deal. “But the government should have been cautious about it,” Subedi told the Post.
Government sources said that a “commercial process agreement” was signed between the Department of Health Services and Sinopharm electronically earlier this month with the Nepali side initially showing interest to procure 10 million doses.
“During the initial negotiations, Sinopharm offered to provide 2 million doses. Later we requested them to increase the quantity. Then we got an offer that we could get 4 million doses for which the price and other procurement conditions were kept secret as per the non-disclosure agreement,” a senior Health Ministry official told the Post. “As soon as the Cabinet gave the nod, reports surfaced, some even quoting the price and quantity. The Chinese were not happy.”
A senior official at the Prime Minister’s Office said that the objective of introducing the “sunset law” was to ease the procurement process.
“After the introduction of the sunset law through an ordinance, we expedited the process to procure vaccines from China,” the official who also spoke on condition of anonymity told the Post.
Proponents of transparency, media freedom and freedom of expression say the question is not whether Nepal is shelling out more money to buy the vaccine or getting the jabs at a cheaper price. Rather the question is whether the taxpayers’ money is being spent in a transparent way or not, according to them.
“The objective of introducing the ‘sunset law’ is to shorten the procurement process, not sign a secret deal,” said Taranath Dahal, chairman of the Freedom Forum, a civil liberty group. “We know this is an emergency situation, but the government should maintain transparency.”
(Arjun Poudel contributed reporting.)