China’s COVID-19 vaccines are here—for better or worse

This is the web version of Eastworld, Fortune’s newsletter focused on business and technology in Asia. Subscribe here to get future editions in your inbox.

Grady McGregor here filling in for Clay Chandler.  

On Tuesday, the world rejoiced as 90-year-old British grandmother Margaret Keenan became the first person in the world to be injected with a fully-tested COVID-19 vaccine from Pfizer and BioNTech.

But the U.K. was not the only country to roll out a foreign vaccine candidate this week.

On Wednesday, the United Arab Emirates approved the vaccine by Chinese state-owned drugmaker Sinopharm for widespread domestic distribution and claimed that Sinopharm’s vaccine was 86% effective in preventing COVID-19 infections after analyzing data from phase III trials.

The move was a signal that Chinese vaccine makers are not far behind their Western counterparts—Pfizer, Moderna, AstraZeneca—which appeared to cross the finish line first by releasing promising phase III trial data.

But among scientists, the UAE’s announcement has raised more questions about Sinopharm’s vaccine than answers. The UAE did not disclose the phase III trial data to the public and, in stark contrast to Western vaccine makers, Sinopharm did not even acknowledge publicly that its vaccine was approved. A spokesperson for a Sinopharm affiliate in Hong Kong declined Fortune’s request for comment and a spokesperson in Beijing hung up on the New York Times when it called about the news.

Sinopharm is a state-owned enterprise that seemingly has little interest in transparency and openly flouts adherence to some international vaccine development standards. In October, Sinopharm Chairman Liu Jingzhen proclaimed that the company had already distributed its vaccine to nearly 1 million people in China before the conclusion of clinical trials as part of China’s controversial emergency-use program.

One of Sinopharm’s Chinese counterparts, the private vaccine maker Sinovac, is more transparent, but it may have a different set of issues to overcome.

Sinovac is currently testing its candidate in phase III trials in Brazil, Indonesia, and Turkey, and has pledged to adhere to scientific protocols. The company also published its phase II trial results in a peer-reviewed medical journal, something Sinopharm has not done. But Sinovac’s stock has been suspended on Nasdaq for over a year as part of a drawn-out corporate governance battle. And in 2016, Sinovac’s founder Yin Weidong admitted to paying bribes to top Chinese drug regulator Yin Hongzhang in exchange for approval of Sinovac’s drug applications. Yin Hongzhang was sentenced to ten years in prison for corruption, but Sinovac was not charged for its role in the bribery case.

But for all of Sinopharm and Sinovac’s flaws, they may fill in the gaps left by Western vaccine makers.

Sinovac and Sinopharm’s vaccines are all based on inactivated forms of the virus, meaning they can be stored at roughly the temperature of a home refrigerator (2 to 8 degrees Celsius) and are more accessible to lower-income countries like Indonesia, where setting up pricey ultra-cold shipping and storage networks appears all but impossible. British pharmaceutical giant AstraZeneca’s vaccine also doesn’t require cold chain networks for distribution, but even after AstraZeneca published its phase III interim data in a peer-reviewed medical journal this week, scientists say continuing questions over the vaccine’s efficacy may force the company to conduct more trials before its candidate can be widely used.  

In November, the Nikkei Asian Review published a map showing 26 countries that have struck deals with Chinese vaccine makers or have agreed to conduct phase III trials of Chinese vaccines. It’s a constellation of mostly developing nations across Asia, South America, the Middle East, and North Africa, perhaps foreshadowing a split among countries—those that use Chinese vaccines versus those that rely on Western-developed ones.

“I expect we will see a divided world in terms of vaccine use,” Yanzhong Huang, senior fellow for global health at the Council on Foreign Relations, told Fortune in October. “You will find that [Organization for Economic Cooperation and Development] countries will prefer U.S.-made vaccines, and many developing countries will have no other choice but to use Chinese-made vaccines.”

More Eastworld news below.

Grady McGregor

This edition of Eastworld was curated and produced by Naomi Xu Elegant. Reach her at

Eastworld news

Miner issues

Seven years ago, Yongcheng Coal and Electricity Holding was one of China's most profitable and lauded energy firms. Today, many of the coal mining company's employees are waiting on months of unpaid wages, and some are resorting to selling flour to earn cash. Pressure from Yongcheng's parent company, the state-owned and financially-troubled Henan Energy and Chemical Group (HECG), led Yongcheng to issue bonds to help pay off HECG debts. Last month, Yongcheng defaulted on 3 billion RMB worth of bonds, attracting national attention to the firm's decline and raising speculation that other state-linked firms could face the same fate. Financial Times

Walking on eggshells

New York-listed Danke Apartment, one of China's largest apartment rental platforms, piqued investor interest by marketing itself as a technology firm, not just a property company. Danke, which means 'eggshell' in Chinese, now faces widespread protests—both online and in person. The landlords it sublets apartments to claim the firm has stopped paying them tenants' rental money, and tenants say landlords are cutting off their utilities and changing their locks because they aren't receiving the rent payments. The controversy is bringing attention to Danke's controversial business model, wherein tenants pay one year's rent upfront with money often obtained through rental loans with Danke's partner banks. Danke said in a brief November statement that it has not gone bankrupt and "will not run away." Caixin Global

More money, more problems

China's 'second generation' children of rich elites, known in China as 'fuerdai,' have built a reputation for their flashy displays of wealth and privilege. But President Xi Jinping's harder line on China's wealthy and the central government's anti-corruption and poverty eradication campaigns are forcing many 'fuerdai' to be more cautious about flaunting their money. One son of a billionaire media tycoon told Bloomberg over a champagne brunch that "my stance is really to follow the path that the government leads—I know our fate moves in tandem." His billionaire father has been careful to keep links between himself and his son off the Internet and keeps his son on a limited allowance so he won't spend too much money and draw attention to himself. Bloomberg

Social credit for corporations 

China is building a social credit system to rate companies on their behavior and reward or punish them accordingly. The initiative will amass data on every corporation in China, pulling from "government records and market-generated corporate compliance data" and amassing the information on a single platform with files for each company, according to a new report by consulting firm Trivium China. Companies with poor compliance records will appear on 'blacklists' and potentially lose access to the market; companies with good records will enjoy economic incentives and appear on 'redlists.' Both lists will be public. Bloomberg

The world's tallest mountain gets taller 

China and Nepal declared a new official height for Mount Everest on Tuesday, saying their survey teams had determined that the world's tallest mountain stands at 29,031.7 feet—two feet higher than the previous consensus. Tectonic activity can change the height of peaks, and Everest hadn't been measured since the 2015 Nepal earthquake. The joint undertaking is also highly symbolic for Beijing and Kathmandu—previous measurements were carried out by other countries—not China or Nepal, even though the mountain straddles their border. Nepal has become an increasingly important ally as China's relations worsen with another crucial neighbor, India. Nepal's foreign affairs minister said Tuesday that the Nepal-China relationship "will rise across the Himalayas, and it will reach a new height." New York Times  

Refugee status

The U.S. House of Representatives on Monday passed a bill that would grant Hong Kong residents Temporary Refugee Status (TPS), which would let them live and work in the U.S. if they fear political persecution in Hong Kong. TPS is typically given to regions struck by war or natural disasters. Hong Kong would be the wealthiest region on the TPS list, with a GDP per capita over 10 times that of El Salvador, currently the richest country with a TPS designation. China's foreign ministry on Tuesday condemned the U.S. actions as "a cover hiding their true aim of using Hong Kong to contain China's development in the name of democracy and freedom." Fortune

A mystery illness

Hundreds of people in southeastern India have been hospitalized after experiencing seizures, nausea, and loss of consciousness with no known cause. Indian health officials on Tuesday said they had found traces of lead and nickel in 25 out of 45 blood samples from hospitalized patients, but they haven't identified lead or nickel in water samples. Now they're testing milk. So far, over 585 people have been hospitalized, more than 500 have been discharged, and one person has died. The outbreak is another health burden for India, which has the second-highest number of coronavirus cases in the world after the U.S. Associated Press 

Coronavirus by country


The Quantum of the Seas cruise ship docked in Singapore Wednesday morning, cutting short a four-day 'cruise to nowhere' after one passenger tested positive for COVID-19. The person has been hospitalized, and the remaining 2,827 passengers and staff must stay on the ship until they test negative for the virus. The 'cruise to nowhere' initiative is part of a broader government effort to jumpstart domestic tourism in Singapore to make up for the lack of foreign visitors due to the pandemic. Singapore has kept daily COVID-19 cases low in recent months, but the city-state's small size means domestic tourism options are geographically limited to the island's 280 square miles. Cruises have been a hotspot for COVID-19 outbreaks since early on in the pandemic—the first one, on the Diamond Princess cruise ship in February, led to 14 deaths and over 700 infections, which at the time represented half the world's cases outside of China. Fortune

Markets and movers

Star Market – Shanghai's answer to Nasdaq, the tech-focused Star Market, logged its 200th initial public offering on Monday with the debut of IT firm Newtouch Software. The board has grown rapidly since it launched in July 2019 to encourage innovative Chinese tech companies to list domestically. CNBC

Goldman Sachs – The investment banking giant is in the process of taking full control of its China joint venture, Goldman Sachs Gao Hua Securities Co. The bank plans to buy out its partner's 49% share of the venture, which would make Goldman the first Wall Street bank with 100% ownership of a mainland China securities firm. Bloomberg

JD Health – Chinese e-commerce giant's healthcare unit, JD Health, debuted in Hong Kong on Tuesday and raised $3.5 billion, making it the city's biggest IPO this year. JD Health closed at around 60% above its list price on its first day of trading. Nasdaq-listed parent company completed a secondary listing in Hong Kong in June. Fortune

Davos – For the first time in almost 20 years, the World Economic Forum will not hold its annual meeting in Davos, the Swiss ski town that's become synonymous with the yearly gathering of business and political elites. For the forum's 2021 in-person meeting, it's moving to Singapore, which has logged fewer than 20 daily new COVID-19 cases over the past two months. Fortune

Final figure

2.1 million

Car sales in China increased for the fifth month in a row in November. Consumers purchased 2.1 million vehicles last month—an 8% year-on-year increase. Car sales are a major driver of China's post-lockdown economic rebound. Auto industry analysts estimate that overall car sales in China, the largest car market in the world, will still drop around 7% this year compared to 2019 because of the pandemic-induced collapse in consumption in the first few months of the year. Wall Street Journal

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