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Responsive COVID-19 Vaccines for Recovery Project Under the Asia Pacific Vaccine Access Facility (Guaranteed by the Republic of Indonesia)

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Responsive COVID-19 Vaccines for Recovery Project Under the Asia Pacific Vaccine Access Facility (Guaranteed by the Republic of Indonesia) Report and Recommendation of the President to the Board of Directors Project Number: 54425-001 March 2021 Proposed Loan PT Bio Farma (Persero) Responsive COVID-19 Vaccines for Recovery Project under the Asia Pacific Vaccine Access Facility (Guaranteed by the Republic of Indonesia) Distribution of this document is restricted until it has been approved by the Board of Directors. Following such approval, ADB will disclose the document to the public in accordance with ADB’s Access to Information Policy. CURRENCY EQUIVALENTS (as of 5 March 2021) Currency unit – rupiah (Rp) Rp1.00 = $0.0000697 $1.00 = Rp14,349 ABBREVIATIONS ADB – Asian Development Bank AEFI – adverse event following immunization APVAX – Asia Pacific Vaccine Access Facility Bio Farma – PT Bio Farma (Persero) COVID-19 – coronavirus disease Indofarma – PT Indofarma Tbk LIBOR – London interbank offered rate M&E – monitoring and evaluation MOH – Ministry of Health PAM – project administration manual RRC – rapid response component TA – technical assistance UNICEF – United Nations Children’s Fund VAP – Vaccination Allocation Plan VIRAT – Vaccination Introduction Readiness Assessment Tool WHO – World Health Organization NOTE In this report, “$” refers to United States dollars. Vice-President Ahmed M. Saeed, Operations 2 Director General Ramesh Subramaniam, Southeast Asia Department (SERD) Directors Ayako Inagaki, Human and Social Development Division (SEHS), SERD Winfried Wicklein, Country Director, Indonesia Resident Mission (IRM), SERD Said Zaidansyah, Deputy Country Director, IRM, SERD Team leaders Azusa Sato, Social Sector Specialist, SEHS, SERDa Amr Qari, Principal Infrastructure Specialist, IRM, SERD Team members Priasto Aji, Senior Economics Officer, IRM, SERD Meenakshi Ajmera, Principal Safeguards Specialist, Office of the Director General (SEOD), SERD Emma Allen, Country Economist, Lao People’s Democratic Republic Resident Mission, SERD Eduardo Banzon, Principal Health Specialist, SEHS, SERD Yurendra Basnett, Senior Country Economist, IRM, SERD Aaron Batten, Principal Planning and Policy Economist, Operations Planning and Coordination Division; Strategy, Policy and Partnerships Department (SPD) Andrew Brian Bennett, Counsel, Office of the General Counsel Robert Boothe, Senior Planning and Policy Economist; Strategy, Policy and Business Process Division; SPD Elizabeth Burges-Sims, Senior Social Development Specialist (Gender & Development), SEHS, SERD Anastasia Carolina, Senior Project Officer (Urban Development), IRM, SERD Gail Oliver Domagas, Senior Financial Control Specialist, Loan and Grant Disbursement Section, Controller’s Department (CTL) Anna Fink, Economist (Regional Cooperation), Regional Cooperation and Integration Thematic Group (SDTC-RCI), Sustainable Development and Climate Change Department (SDCC) Anthony Gill, Senior Regional Cooperation Specialist, Regional Cooperation and Operations Coordination Division, SERD Prabhjot Rehan Khan, Social Development Specialist (Gender and Development), SDCC Aiko Kikkawa Takenaka, Economist, Economic Analysis and Operational Support Division, Economic Research and Regional Cooperation Department Keiko Koiso, Senior Procurement Specialist, Procurement Division 2 (PFP2); Procurement, Portfolio and Financial Management Department (PPFD) Rouselle Lavado, Senior Health Specialist, Social Sector Division, Central and West Asia Department Dennie Mamonto, Environment Officer, IRM, SERD Naning Mardiniah, Senior Safeguards Officer (Resettlement), IRM, SERD Kevin Moore, Senior Procurement Specialist, PFP2, PPFD Antoine Morel, Principal Environment Specialist, SEOD, SERD Hung Ba Nguyen, Senior Regional Cooperation Specialist, SDTC- RCI, SDCC Felix Oku, Senior Social Development Specialist (Safeguards), Safeguards Division (SDSS), SDCC Myra Evelyn Ravelo, Financial Management Specialist, Public Financial Management Division, PPFD Lindsay Marie Renaud, Results Management Specialist, Results Management and Aid Effectiveness Division, SPD Francesco Ricciardi, Environment Specialist, SDSS, SDCC January Sanchez, Integrity Specialist, Office of the Head (AIOD), Office of Anticorruption and Integrity (OAI) Frances Lynette Sayson, Senior Integrity Officer, AIOD, OAI Deeny Uli Rosa Simanjuntak, Senior Project Officer, IRM, SERD Laarni Tabinas-Canonizado, Senior Financial Control Officer, Loan and Treasury Accounting Section, CTL Sayaka Takahashi, Senior Integrity Specialist, Prevention and Compliance Division, OAI James Villafuerte, Senior Economist, IRM, SERD Maria Angelica Vivar, Associate Project Analyst, SEHS, SERD Shekinah Wenceslao, Senior Operations Assistant, SEHS, SERD Won Mo Yang, Senior Financial Control Specialist, Loan and Treasury Accounting Section, CTL Peer Reviewers Patrick Osewe, Chief of Health Sector Group, Health Sector Group, SDCC Jayantha Liyanage, Regional Advisor, Regional Office for Southeast Asia, World Health Organization Sowmya Kadandale, Chief of Health, United Nations Children’s Fund, Indonesia a Outposted to the Indonesia Resident Mission. In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area. CONTENTS Page PROJECT AT A GLANCE I. THE PROPOSAL 1 II. THE PROJECT 2 A. Rationale 2 B. Project Description 8 C. ADB Value Addition and Experience 9 D. Summary Cost Estimates and Financing Plan 9 E. Implementation Arrangements 11 III. DUE DILIGENCE 11 A. Economic and Financial Viability 11 B. Governance 12 C. Poverty, Social, and Gender 12 D. Safeguards 13 E. Summary of Risk Assessment and Risk Management Plan 13 IV. ASSURANCES AND CONDITIONS 15 V. RECOMMENDATION 15 APPENDIXES 1. Design and Monitoring Framework 16 2. List of Linked Documents 19 Project Classification Information Status: Complete PROJECT AT A GLANCE 1. Basic Data Project Number: 54425-001 Project Name Responsive COVID-19 Vaccines for Department/Division SERD/SEHS Recovery Project under the Asia Pacific Vaccine Access Facility Country Indonesia Executing Agency PT Bio Farma (Persero) Borrower PT Bio Farma (Persero) Country Economic https://www.adb.org/Documents/LinkedDocs/ Indicators ?id=54425-001-CEI Portfolio at a Glance https://www.adb.org/Documents/LinkedDocs/ ?id=54425-001-PortAtaGlance 2. Sector Subsector(s) ADB Financing ($ million) Health Disease control of communicable disease 450.00 Total 450.00 3. Operational Priorities Climate Change Information Addressing remaining poverty and reducing inequalities GHG reductions (tons per annum) 0.000 Accelerating progress in gender equality Climate Change impact on the Low Fostering regional cooperation and integration Project ADB Financing Adaptation ($ million) 0.00 Mitigation ($ million) 0.00 Cofinancing Adaptation ($ million) 0.00 Mitigation ($ million) 0.00 Sustainable Development Goals Gender Equity and Mainstreaming SDG 1.1, 1.b Some gender elements (SGE) SDG 3.3, 3.8 SDG 5.4, 5.6 Poverty Targeting SDG 10.2 General Intervention on Poverty SDG 17.6 4. Risk Categorization: Complex . 5. Safeguard Categorization Environment: C Involuntary Resettlement: C Indigenous Peoples: C . 6. Financing Modality and Sources Amount ($ million) ADB 450.00 Sovereign Asia Pacific Vaccine Access Facility (Regular Loan): Ordinary 450.00 capital resources Cofinancing 0.00 None 0.00 Counterpart 345.00 Others 345.00 Total 795.00 Currency of ADB Financing: US Dollar Source: Asian Development Bank This document must only be generated in eOps. 05022021115707233615 Generated Date: 10-Mar-2021 9:01:25 AM I. THE PROPOSAL 1. I submit for your approval the following report and recommendation on a proposed loan to the state-owned enterprise, PT Bio Farma (Persero) (Bio Farma), to be guaranteed by the Republic of Indonesia, for the Responsive COVID-19 Vaccines for Recovery Project under the Asia Pacific Vaccine Access Facility. The project will provide Bio Farma with financing for vaccine procurement and logistics based on an agreed list of eligible expenditures to vaccinate priority populations against the coronavirus disease (COVID-19). The rapid response component (RRC) under the Asia Pacific Vaccine Access Facility (APVAX) will be utilized. The project is aligned with the following operational priorities of Strategy 2030: (i) addressing remaining poverty and reducing inequalities, (ii) accelerating progress in gender equality, and (iii) fostering regional cooperation and integration.1 The project is consistent with the Asian Development Bank (ADB) country partnership strategy for Indonesia, 2020–2024, as it will improve the well-being of Indonesians by strengthening the health system and preventing the spread of COVID-19.2 2. The project fulfills all APVAX access criteria as shown in Table 1. Table 1: Compliance with Access Criteria of the Asia Pacific Vaccine Access Facility Access Criteria ADB Staff Assessment 1. Demonstrated COVID-19 has infected more than 1.3 million Indonesians, causing about 35,000 fatalities, adverse impact of including more than 840 fatalities of health care workers. Health services have suffered COVID-19 severe disruption. Women have been exposed to greater risk than men because of their professional affiliations and roles within households. COVID-19 caused real gross domestic product to contract by 2.1% in 2020, down from an original growth forecast of 5.2%. Approximately 30 million people have experienced reductions in work hours or job loss, worsening
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