Hunt for Vaccine Is the World’s New Space Race: Balance of Power

(Bloomberg) --

The battle to defeat the coronavirus is becoming a struggle for supremacy that recalls the Cold War contest to dominate space.

Just as the Soviet Union jolted U.S. self-confidence by sending the first man into orbit in 1961, American pride would suffer a similar blow if China wins the race to develop a vaccine against the virus, Marc Champion writes.

President Donald Trump, who has repeatedly blamed China for the pandemic, is pursuing a research drive dubbed Operation Warp Speed. Chinese President Xi Jinping is overseeing an effort that is more advanced for now, while scoring geopolitical points with airlifts of medical aid to virus-stricken countries.

Russia has multiple vaccine projects underway, determined to avoid dependence on rival powers. The U.K., eager to bolster its “global Britain” image after Brexit, says Britons will be first in line if promising Oxford University research is successful.

The European Union has thrown its weight behind a more cooperative approach at a Group of 20 fundraiser for research, with its credibility on the line after admitting it was slow to come to Italy’s aid.

The competition stakes could hardly be higher, even as China and the U.S. pledged to work to implement their bilateral trade deals. The nation that can immunize its workforce first will gain economic advantage and validation of its technological prowess and global standing.

If that is China, the geopolitical impact could be as dramatic as that first space shot.

Global Headlines

Scandal revived | Trump’s supporters and opponents got new ammunition from old controversies just months from the 2020 election. The Justice Department’s decision to drop its case against his first national security adviser Michael Flynn for lying to FBI agents prompted renewed allegations that Attorney General William Barr is doing Trump’s partisan bidding. Meanwhile, House Democrats released thousands of pages of transcripts on whether the Trump campaign conspired with Russia in the 2016 election.

• Read here how the Trump administration’s $28 billion trade bailout largely overpaid farmers, a key part of his political base.

Mounting frustration | Brazil’s economy minister is tiring of losing budget battles in Congress and fears that, without the support of President Jair Bolsonaro, public spending will soar to levels he considers unsustainable. Martha Beck and Simone Iglesias explain that while Paulo Guedes hasn’t asked to resign, he’s signaled his future in the administration is no longer certain.

Expectations lowered | With top scientists warning the U.K’s infection rate has crept upward in recent days, Boris Johnson’s government is trying to damp hopes it will significantly roll back the coronavirus lockdown. The prime minister is due to outline a plan to ease restrictions on Sunday, but as Alex Morales and Robert Hutton report, the rules may not change greatly until June.

Defense withdrawal | The U.S. has removed two of its four Patriot anti-missile batteries from Saudi Arabia and another two in the Middle East partly because tensions with Iran have eased, Tony Capaccio and Glen Carey report. Although Trump has long called for troop reductions in the region, he began deploying additional forces following last year’s downing of a U.S. drone over the Persian Gulf and attacks on Saudi Aramco oil facilities, both of which were blamed on Iran.

Head start | Before the coronavirus even registered on other governments’ radars, Taiwan was testing and quarantining travelers from the Chinese city of Wuhan. The island’s fraught — but still close — networks with China gave it a ringside view to the pandemic’s original epicenter, enabling it to deploy a containment strategy that’s proven to be one of the world’s most successful. As Cindy Wang and Samson Ellis explain, Taiwan, which started control measures on Dec. 31, has seen just six deaths from Covid-19.

What to Watch

• Today’s U.S. jobs report is forecast to show employers slashed about 22 million jobs in April, nearly erasing a decade of gains in a single month as the country shut down in response to the coronavirus.
• Indonesian officials are considering reopening Southeast Asia’s largest economy in phases starting next month, as job losses accelerate and businesses struggle to survive.
• Almost one million people in Johannesburg, Africa’s wealthiest city, need food aid due to movement restrictions imposed to curb the pandemic, Mayor Geoff Makhubo said in an interview.

Pop quiz, readers (no cheating!). Which South American country’s leader accused mercenaries of trying to overthrow its government? Send us your answers and tell us how we’re doing or what we’re missing at balancepower@bloomberg.net.

And finally ... Children with Covid-19 may threaten recovery from the pandemic, Vernon Silver and Marco Bertacche report, sparking increased scrutiny of their cases from scientists and policymakers as regions move to reopen from their lockdowns. While infections among those under 18 comprise a small portion of the worldwide total, there have been reports in the U.S., U.K. and Europe of a mysterious condition affecting children known as “multi-system inflammatory state” that could be linked to the coronavirus.

©2020 Bloomberg L.P.