Will Chinese philanthropy for R&D continue to grow after COVID-19?

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Chinese Premier Li Keqiang inspects the Institute of Pathogen Biology at the Chinese Academy of Medical Sciences in Beijing, China. Photo by: cnsphoto via Reuters

MANILA — There’s been an increase in Chinese philanthropic giving to drug and vaccine research and development efforts amid the COVID-19 pandemic, including from tech leaders such as Jack Ma, and Tik Tok’s Zhang Yiming. Some of the funding has gone to global institutions and initiatives.

Even as Chinese philanthropy has significantly grown over the past decade, giving to R&D efforts has been minimal. Just 1.3% of the 140 billion Chinese Yuan ($20.1 billion) donations in 2018 went to R&D, said Ruixi Hao, program officer for philanthropic partnerships at the Bill & Melinda Gates Foundation’s country office in Beijing, during a webinar on Thursday on Chinese philanthropy hosted by the Asian Venture Philanthropy Network.

This changed with the COVID-19 pandemic, with an estimated 1.8 billion Chinese Yuan having gone to COVID-19 R&D efforts as of May 2020, representing 5-10% of Chinese private philanthropy for COVID-19 response efforts, according to Bridge Consulting’s latest “Pandemic Philanthropy” report.

“R&D is a long-term strategic investment. So we always reflect on the lesson of SARS … 17 years ago, we thought it [was] gone, but then it comes back again.”

— Manchun Lu, COO, Global Health Drug Discovery Institute

Much of the funding has gone to vaccine and antiviral drug R&D. Some of the biggest donations came from property developer and Fortune 500 company Evergrande Group, which donated 800 million Chinese Yuan to Harvard University & the Guangzhou Institute of Respiratory Disease for research into COVID-19 diagnostics, treatment, and vaccines.

The company also donated 100 million Chinese Yuan to the Chinese Academy of Medical Sciences for drug development. Chinese tech company Baidu created a 300 million Chinese Yuan fund to support drug development efforts and public health information campaigns.

Most of the donations have gone to Chinese institutions, but a few have also benefited organizations outside China. The Jack Ma Foundation has given 14.7 million Chinese Yuan to Peter Doherty Institute for Infection and Immunity in its efforts to find a vaccine against COVID-19, and 15 million Chinese Yuan to Columbia University for drug development. Zhang Yiming, founder of ByteDance, the company behind TikTok, donated 71 million Chinese Yuan to the COVID-19 Therapeutics Accelerator. TikTok also pledged $10 million to Gavi, the Vaccine Alliance in April.

It’s a rare but encouraging example of Chinese philanthropy contributing to global, multilateral mechanisms during this pandemic, Hao said.

Experts are hopeful this would trigger more giving to R&D efforts among philanthropists in China over the long-term and post-pandemic.

In depth for Pro subscribers: China's philanthropy scene is growing — just not internationally 

China’s rapid economic growth over the past several decades has sparked a rise of extremely wealthy individuals, but of the top 100 Chinese donors in 2018, only two donated to recipients outside of mainland China.

“Many donors have actually emphasized that the search for a vaccine is long-term and have managed expectations of the likelihood for success. So it doesn't sound like they're in it for the short-term gain. It doesn't also sound like they're in it primarily to gain media attention,” said Angel Teh, associate director of Bridge Consulting.

But there are a number of factors that could affect this trend. The economic downturn brought about by the pandemic will likely put pressure on businesses, in turn affecting private capital. But potential cutbacks on public spending for R&D could also lead to political pressure for private donors to fill the gap, she said.

“But politically, international debate over questions of blame that we're seeing right now in the public arena, that could also put more pressure on the Chinese end to pour even more funding into R&D,” Teh said.

The size of Chinese philanthropy reached $23.4 billion in 2017. This is largely driven by corporate giving, which made up 65% of total giving that year. The 2008 earthquake in Sichuan province has often been cited as a turning point in Chinese philanthropy. The disaster raised 1.6 billion Chinese Yuan ($230 million) from Chinese firms in a span of 10 days, according to Bridge Consulting’s report.

A large bulk of Chinese philanthropy has traditionally gone to education and poverty alleviation, accounting for 35% and 29%, respectively, of giving in 2019. Ninety percent of China’s top 10 philanthropists also give these sectors priority. In recent years, there’s been interest in some to give to causes focused on youth entrepreneurship and climate change.

Research in China is not considered as social welfare, said Manchun Lu, COO at the Global Health Drug Discovery Institute, a Beijing-based not-for-profit research organization founded in 2016 by the Gates Foundation, Tsinghua University, and Beijing’s municipal government.

The traditional thinking has been that research and higher education are the responsibility of the government to finance, and so most private money has gone to support basic and rural education, disaster relief, and poverty alleviation, she said. The tangible impacts of donating to research is also not as visible as sending a child to school, or funding a building with the donor’s name on it, she said.

“It's good to see the 5% of donations come to R&D, but truly, R&D is a long-term strategic investment. So we always reflect on the lesson of SARS … 17 years ago, we thought it [was] gone, but then it comes back again. And now most of us believe the pandemic and other virus threats will come from time to time.

“So we actually need constant support from the philanthropic sector,” Lu said.

About the author

  • Jenny Lei Ravelo

    Jenny Lei Ravelo is a Devex Senior Reporter based in Manila. She covers global health, with a particular focus on the World Health Organization, and other development and humanitarian aid trends in Asia Pacific. Prior to Devex, she wrote for ABS-CBN, one of the largest broadcasting networks in the Philippines, and was a copy editor for various international scientific journals. She received her journalism degree from the University of Santo Tomas.