In the discussion on Africa’s need and capacity to manufacture vaccines, it is imperative to look at the broader requirements needed to build and sustain such an important undertaking. Expanding vaccine manufacturing in Africa is a complex undertaking, requiring several factors to align.
Critically, the nascent industry needs widescale collaboration among a broad range of stakeholders, including pan-African leadership organisations, regional economic governments, national governments, private-sector players, and global-health actors.
An ecological approach to designing economic sectors is based on ecosystems. An ecosystem is defined as a dynamically stable network of interconnected firms and institutions within bounded geographical space. By taking such a systems approach means that focus is given on both the individual components of the system as well as on the sum of the parts and this is in fact believed to yield maximum results when building economic sectors and visions.
The question that one will naturally ask is, what are the components for a successful ecosystem-based approach to economic design and planning? A good regulatory and legislative framework are central to any ecosystem together with the associated governance and institutional mechanisms. In our experience, we have found that building proactive and innovative regulators is critical to the long-term success of the ecosystem. Regular regulatory reviews and legislative changes to cater for new developments and trends are fundamental for a sector to remain competitive and attractive. Also, regulatory capacity building needs to be regular.
In line with this, human talent is also a key pillar of any ecosystem. This is especially the case for vaccine manufacturing which requires highly skilled and specialised human resources. The power of the ecosystem to attract investment to it depends very much on the availability of skilled and required talent. This means that educational partners need to be fully onboard in the design of the ecosystem to ensure that the right qualifications are being offered and other training programmes. Tax incentives and special programmes can be designed to attract foreign talent. In addition, residency schemes or visas can be a luring factor in a new start-up dominated and nomad environment.
Talent is nurtured by educational institutions which also need to collaborate with the private sector to develop research, development and innovation. Here, collaboration agreements between industry and academia are central to sustain future-proof growth. The creation of business parks close to universities can translate in important innovation cross-fertilisation and spill-over adding to the vibrancy and dynamism of the ecosystem itself.
Clusters also thrive on access to finance as it serves as the blood for the system to grow and develop. Here, innovative financing solutions and products can enhance a sector’s attractiveness and also its linkages to start-ups. The availability of seed financing, venture capital, private equity as well as capital markets together with a responsive banking sector will be critical for any ecosystem to thrive. Development banks are proving to be a critical source of risk-sharing and financing for projects. Vaccine manufacturing will also attract donor financing. For example, the European Union launched an initiative that will help create an enabling environment for local vaccines manufacturing in Africa and tackle barriers on both supply and demand sides, backed by €1 billion from the EU budget and the European development finance institutions such as the European Investment Bank (EIB). This amount will be further enhanced by contributions from EU Member States. In addition, impact financing and investment can also be an important channel for such funding flows to support the creation of this cluster.
Finally, the general business and market environment needs to be supportive of the ecosystem. Tax systems that are simple and attractive together with investment support schemes are fundamental building blocks. General infrastructure which is sector-supportive, such as electricity, water purification, telecommunications, data centres or air connectivity, will also be important. Access to international markets aided by double taxation agreements is seen as having an important role in developing a sustainable and attractive ecosystem.
Economic sectors require a systems-thinking approach. They depend on the sum of parts and on having all elements aligned and well-functioning. Designing economic sectors start with a vision or realisation that there is a gap in the local and more importantly regional space to attract a nascent or fast-growing sector. Maintaining it and making it attractive depends on the well-functioning of all elements.
The global COVID-19 pandemic presents a unique moment for leaders across the public, private, and social sectors to align on the importance and potential for developing this sector. The case for homegrown vaccine manufacturing is by no means obvious, but with the right level of commitment and support it is not out of reach for some countries, Rwanda being one of them.
JP Fabri is a co-founding partner of Seed, a research-driven consultancy firm.
jp@seedconsultancy.com | www.seedconsultancy.com