CEO DailyCFO DailyBroadsheetData SheetTerm Sheet

Where will vaccine passports actually take us?

March 16, 2021, 10:02 AM UTC

Apologies if today’s Eastworld essay feels a bit rushed. I must dash out to be jabbed. By the time you read this, I should have COVID-19 antibodies coursing through my veins courtesy of Pfizer and BioNTech. Hurrah!

Hong Kong has been slow to roll out its vaccination program. The first doses weren’t delivered until late February, and those were restricted to government leaders, front-line workers, the elderly, and selected high-risk groups.

But now, as the city scrambles to avoid a “fifth wave” of infection from an outbreak linked to a gym popular with expat bankers and lawyers, health officials here seem determined to make up for lost time. Yesterday, the government abruptly announced that anyone over the age of 30 could sign up for a shot—setting off a mad registration scramble this morning.

If all goes well, I’ll get my second dose early next month and be considered fully vaccinated the following week or so. After a year of avoiding restaurants, theaters, cafes, public transit, and face-to-face encounters with sources, friends and neighbors, I can only imagine how liberating that will feel.

And yet it’s unclear how liberated I’ll actually be. Since others will have no way of immediately discerning whether I have been vaccinated or not—and because it’s theoretically possible for vaccinated people to still carry the coronavirus—prudence will require that I continue to wear a mask. I’ll still be stuck on Zoom calls, still have to be tested before I go to the gym. And there’s no telling how long it will be before I can fly out of Hong Kong without having to endure weeks of quarantine wherever I land.

It’s a classic social trust dilemma. I may feel confident that I’m not at risk from others. But how can others be sure they’re not at risk from me?

Two countries, Israel and China, are tackling that problem with technology. On Monday’s The Daily podcast, New York Times Jerusalem correspondent Isabel Kershner described how, in just a few short months, Israel has morphed from COVID catastrophe into a global vaccine leader, whose citizens can go to concerts, restaurants, schools and supermarkets without fear of infection. Israel—thanks to its relatively small size, efficient universal health care system, and prime minister frantic to assure his own re-election—has managed to vaccinate more than half its population.

And it is solving the social trust issue with a “green passport” in the form of a mobile phone app that can be downloaded from the Health Ministry’s website.

“You apply for the green pass,” Kershner explains. “And then once you’re approved, you have this little moving picture of green people walking along, looking happy, like a happy fully vaccinated family, like a sort of meme thing on your phone. And it has your ID number and your name, and that’s your green passport.”

Gyms, swimming pools, theaters, and wedding halls now routinely ask patrons seeking reservations, “Do you have a green passport?” says Kershner. “So this is really the entry ticket now back to normal life.”

Over the weekend, my colleagues Grady McGregor and Eamon Barrett explained how China’s government, with the help of technology giant Tencent Holdings, has developed a similar system that displays a QR code via Tencent’s WeChat app that links to users’ vaccine and COVID-19 test history.

In both countries, digital vaccine passports are fraught with legal and ethical problems. Is it moral to discriminate against someone who hasn’t been vaccinated because of religious beliefs, or because they have inferior access to health care or information about the virus? Can we trust the state or large technology companies with so much personal information?

And getting other countries to accept vaccine passports is proving extremely challenging, to say the least. The Guardian reports that Israel has signed tentative agreements with Greece, Cyprus, and the Seychelles to allow vaccinated citizens to cross each others’ borders without quarantine. But negotiating such accords was made easier by the fact that all have approved the Pfizer-BioNTech vaccine.

Here in Hong Kong, the situation is more complicated. The government has procured three different vaccines from three different companies: Pfizer-BioNTech, Chinese firm Sinovac Biotech, and the United Kingdom’s AstraZeneca. Only the Sinovac vaccine has been approved on China’s mainland.

This weekend, days after I registered for my vaccine of choice, the Pfizer-BioNTech jab, Beijing announced that it will ease visa application requirements for foreigners seeking to enter the mainland from Hong Kong if they have been inoculated with one of the four COVID-19 vaccines made in China.

But the Pfizer-BioNTech jab I am about to receive isn’t on mainland’s approved list yet, even though it has been cleared by health officials in Hong Kong and is being distributed here by Fosun Pharma, a mainland company based in Shanghai.

The Pfizer-BioNtech vaccine has published clinical data, while Sinovac has not. Pfizer-BioNtech’s jab has shown a 96% efficacy rate, while trials in Brazil suggest Sinovac’s efficacy rate is about 50%. Even so, when it comes to vaccine passports, the principal of “one country, two systems” is rigorously applied.

We’ll take up the question of vaccine passports on our next Fortune Global Tech Forum virtual conversation on June 8. Mark your calendar and stay tuned for details!

More Eastworld news below.

Clay Chandler
clay.chandler@fortune.com

This edition of Eastworld was curated and produced by Eamon Barrett. Reach him at eamon.barrett@fortune.com

EASTWORLD NEWS

Close, sesame

Beijing is pressuring Alibaba to sell its media assets, including the Hong Kong-based South China Morning Post, which Alibaba acquired for $266 million in 2015. According to the Wall Street Journal, Chinese authorities are concerned by the amount of influence tech companies wield through their media assets. Bloomberg reports Xi Jinping told regulators to target “platform” companies on Monday, stoking fears that Tencent is up next in the crackdown on Big Tech. Tencent’s market cap dropped $62 billion over the weekend. WSJ

AstraZeneca

Thai Prime Minister Prayuth Chan-ocha became the first person in Thailand to receive the AstraZeneca vaccine on Tuesday, after rollout of the vaccine was paused for several days due to reports from Europe of a possible blood clotting risk. Australia has also decided to continue with its AstraZeneca rollout, citing the millions of doses that have been administered without incident worldwide. The WHO urged countries to continue distributing the vaccine on Monday, stating there was no evidence that the vaccine causes blood clots while the European Medicines Agency (EMA) says the incidence of blood clotting in people who have received the vaccine—0.0006%—is no higher than the incidence rate in the general population. Fortune

Vaccine-nations

On Friday, the so-called Quad—India, the U.S., Australia and Japan—pledged to provide a billion COVID-19 shots across the Indo-Pacific region by 2022. The doses will be manufactured in India and financed by the other Quad members. The scheme is seen as a bid to counter the influence of China’s own “vaccine diplomacy.” Meanwhile, the New York Times reports China has seemingly used its vaccine supply lines to help Huawei Technologies regain access to Brazil’s 5G market. Straits Times

Cryptoban 

India is reportedly considering introducing a bill to ban cryptocurrencies, potentially fining anyone found trading in or even owning the digital assets. The ban would also outlaw crypto-mining and paves the way for India to build its own fiat cryptocurrency, which the government proposed doing in January. China’s Inner Mongolia banned crypto-mining at the beginning of March. China, too, is in the process of creating its own sovereign cryptocoin. Reuters

Myanmar burns

Several Chinese-owned factories were set ablaze in Myanmar on Sunday, as protests against the military coup continue into the seventh week. China nationalist tabloid Global Times reported damage to the 32 factories totals $37 million. It’s not clear who started the fires, but some in the protest movement believe China is supporting the military junta. A local NGO said Tuesday that over 180 people have been killed since the coup on Feb. 1. Bloomberg

MARKETS AND MOVERS

Evergrande EV - The electric vehicle wing of real estate developer China Evergrande has partnered with a unit of tech giant Tencent to develop an operating system for “smart vehicles.”

Thai pork - Thailand’s exports of live pigs rose 339% last year as an outbreak of African Swine Fever decimated pig stocks across the rest of Asia, particularly in China. Pork exports increased 69%, too.

Xiaomi – Xiaomi shares jumped 10% on Monday after a U.S. judge temporarily blocked a Trump-era order than banned U.S. traders from investing in the firm.

Marching ants – Ant Group CEO Simon Hu resigned on Friday, ahead of a major restructuring at the fintech firm. Ant says Hu’s resignation was due to “personal reasons,” and he has been replaced by Ant chairman Eric Jing.

Rubber sole - Zara supplier Service Footwear, Pakistan’s largest shoe exporter, is planning a $10 million IPO on the Pakistan Stock Exchange. The shoe maker plans to use proceeds to buy a 20% stake in a tyre-manufacturing joint venture established by Service Footwear’s parent company and China’s Long March Tyre.

Megvii – China computer vision pioneer Megvii filed for an IPO on Shanghai’s Star Market, Friday, potentially raising $922 million. Megvii filed for an IPO in Hong Kong in 2019, but let the application lapse after the Trump Administration placed the company on a trade blacklist.

Wise – Grab co-founder Tan Hooi Ling joined the board of London-based fintech firm Wise on Monday. The digital banking services provider said it plans to expand globally in coming years.

FINAL FIGURE

$4.6 billion

The Dalian Wanda Group gave up its majority control of the world’s largest cinema chain, AMC, this month as the movie theatre operator reported $4.6 billion in losses for 2020. Wanda acquired AMC for $2.6 billion in 2012 and remains its largest single shareholder, now with 9.8% stake, down from 38% in October. Previously one of China’s most acquisitive companies, Wanda began scaling down its overseas holdings in 2017 to counter mounting debt. The conglomerate’s once-cocksure CEO Wang Jianlin has retreated from the limelight, too, having lost $32 billion from his personal wealth since 2015, when he was ranked as the richest man in Asia. Bloomberg