Billionaire Andrew Forrest’s acquisition of 10 million COVID-19 tests reveals some strange dynamics around health policy, geopolitics and international commerce.

It was a bizarre scene.
Billionaire Andrew Forrest, Australian Health Minister Greg Hunt and China’s Victorian Consul General Long Zhou all stood side by side to celebrate a commercial coup.
Mr Forrest’s Minderoo Foundation had managed to secure precious cargo from China: 10 million COVID-19 test kits, which will soon be handed out to hospitals, clinics and labs around Australia.
The spectacle stoked a brief furore, with Coalition MPs accusing Mr Forrest of allowing the senior Chinese diplomat to “gatecrash” a Federal Government press conference, while Australia and China are stuck in a fierce dispute over the coronavirus outbreak.
Health Minister Greg Hunt thanked Andrew Forrest (R) for his work yesterday.(AAP: James Ross)
But the episode also revealed some of the strange dynamics at play in the coronavirus era, at the intersection where health policy, geopolitics and international commerce meet.
Why are these test kits so important?
Why is Australia depending on a private philanthropic foundation to bring in crucial medical supplies during an international pandemic?
And what does all this have to do with China?
Here’s what’s coming into Australia
It’s not surprising that Mr Forrest was trumpeting his purchase.
The Federal Government says the 10 million test kits will allow it to dramatically ramp up COVID-19 testing over the coming weeks and months.
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In fact, Greg Hunt predicts it will allow the Commonwealth to increase testing almost 20-fold between now and the end of the year.
It’s not just the kits Minderoo is also bringing in 11 testing machines, which are being installed around the country.
Minderoo also flew in six Chinese experts to help set up the testing machines. All of them were tested for the coronavirus before being allowed into the country.
Why isn’t the Government buying the equipment?
As the coronavirus wreaks havoc in country after country, there is intense and growing demand for crucial medical supplies such as COVID-19 test kits and medical masks.
And this demand has stoked equally intense competition, with governments across the globe pitted against each another.
Inevitably this has driven up the cost of testing equipment as countries and companies employed as middlemen desperately try to outbid each other.
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Mr Forrest told the media yesterday that the Foundation had to fight “sophisticated coercion” in order to land the deal with the Beijing Genomics Institute (BGI).
“We also had offers from other countries, much higher than I had agreed with Chairman Wang of BGI and I’m talking much, much higher,” he said.
“And Chairman Wang and BGI kept to their word and resisted that very clear temptation of a businessman to make a much bigger profit and maintain the integrity of my relationship, and I’m very grateful for that.”
Mr Forrest has credited his personal relationship with BGI for rescuing the deal and getting the test kits to Australia.
And the Government conceded that in this extraordinary era, it’s not enough to simply ask government agencies to buy the equipment Australia needs.
Often it needs the help of business heavyweights with deep connections in the country which is producing much of the sought-after medical equipment: China.
Someone, in other words, just like Andrew Forrest.
Why are the tests so crucial?
As the number of COVID-19 cases in Australia drops off, governments are turning their attention to how they can safely ease restrictions and re-open the country.
Find out more
One of the main things the Government wants to do is radically expand testing to ensure there are no surprise coronavirus flare-ups.
This is called sentinel testing where a population is effectively randomly sampled in order to track the virus.
But doing this requires an enormous number of test kits.
That’s why purchases like the one by Minderoo are so important.
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Was it a donation?
No.
Minderoo spent $325 million to buy the equipment, but it will be reimbursed the full amount by the Federal Government.
The foundation will not charge the Commonwealth any interest. There’s no commercial benefit for Minderoo or for Mr Forrest.
But the billionaire’s critics say it’s naïve to see his announcement as a philanthropic gesture. And yesterday’s announcement was mired in geopolitics within minutes of its end.
This chart uses a logarithmic scale to highlight coronavirus growth rates. Read our explainer to understand what that means and what we can learn from countries that have slowed the spread.
Coalition MPs lined up to criticise Mr Forrest for inviting the Chinese Consul General to speak at the podium, accusing him of undermining the Minister during a fraught moment in the bilateral relationship.
They argue the billionaire is intent on currying favour with Beijing and protecting his commercial interests.
BGI has been one of the Chinese Government’s main suppliers in its so-called “mask diplomacy” push.
And while many governments say they’ve had no problems with the kits they’ve been sent, others have complained that they’ve been saddled with defective equipment.
Mr Forrest, Mr Hunt and Mr Zhou will all be hoping the kits now heading to Australia work perfectly.
Otherwise, yesterday’s celebrations could quickly turn to ashes.
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