EIU Global Outlook – A global view of vaccination progress

Since it started in December 2020, the global rollout of coronavirus (Covid‑19) vaccines has become the most important variable in making economic—and to some extent political—forecasts. Assuming that the rollout proceeds as we currently expect, most developed countries should have immunised 60-70% of their population by mid-2022. The first economic effects should be felt sooner, however; we expect the global economic recovery to pick up pace from mid‑2021.

Swift progress in the US since Biden’s inauguration

The US vaccination campaign has speeded up in recent weeks, albeit from a low base; more than 45m doses have been administered so far, with much more remaining to be done before a large share of the population is inoculated. The new US president, Joe Biden, has set a target of vaccinating 100m people before the end of his first 100 days in office. Although this looked to be an overly ambitious goal at first, it is achievable. The US is on track to complete immunisation of 60-70% of its population in the second half of this year, but two issues remain unresolved: the federal government’s poor initial response to the pandemic, which has hindered vaccine distribution; and continued vaccine hesitancy, especially among some minority ethnic groups.

A painfully slow rollout in the EU

The rollout has been slow in the EU amid high incidence rates and renewed lockdowns. The EU’s sluggishness is in part due to the fact that the bloc has chosen to set up a common procurement process, ensuring low prices and simultaneous deliveries to all member states. However, this centralised system has delayed the rollout process, which has been further compounded by a lack of investment in manufacturing capabilities. Enough people should be immunised by the autumn—when we expect a resurgence of the virus—to avoid lockdowns. This should help to boost the economic recovery from the third quarter, but social distancing measures are likely to remain in place throughout the year, choking activity.

China and India will achieve widespread immunisation only in late 2022

Many developed Asian countries, including Singapore, Taiwan, Australia, New Zealand, Japan and South Korea, will have immunised the bulk of their population by mid-2022. Our forecasts for China and India stretch until end-2022; in both countries the huge size of the population and the limited number of healthcare workers will pose challenges. China and India have embarked on a vaccine diplomacy strategy (alongside Russia), providing doses to countries where they want to boost their influence or where they have economic or political interests. This strategy comes with significant risks, as China and India will struggle to supply both their domestic and export markets with vaccines for at least several months (if not years).

Latin America has got off to a slow start

The rollout has been slow so far across Latin America, and widespread vaccination coverage will not be obtained until at least mid-2022 in the largest economies. Only a handful of countries have launched immunisation campaigns so far, and even in these countries few doses have been administered (Chile being a notable exception). Brazil and Mexico, the two biggest economies in the region, are doing especially badly, reflecting an overall poor response to the pandemic. However, both countries will soon host manufacturing facilities, which should boost immunisation rates.

The Middle East and North Africa present a mixed bag

The Middle East and North Africa region boasts three success stories in the rollout of vaccines: Israel, Bahrain and the UAE. The small size of these populations and high financing capabilities mean that the rollout in these states has been among the swiftest in the world. Vaccine diplomacy from China is also helping; the UAE is widely using the Chinese-made Sinopharm for its immunisation campaign and will soon host production facilities. Israel, Bahrain and the UAE are exceptions, however; other countries in the region are in a more difficult situation, and their vaccination timelines will stretch until late 2022 or beyond, keeping travel limited and hampering economic recovery.

Will Sub-Saharan African countries ever get vaccines?

The Sub-Saharan Africa region will mostly rely on the World Health Organisation (WHO)-led COVAX initiative to access vaccines. However, COVAX will cover only 20% of the population of eligible countries, and its timelines are non-binding and subject to change, which could mean delays in deliveries. Many Sub-Saharan countries will probably never achieve full vaccination coverage, especially those with a young population (that is less likely to develop severe forms of the coronavirus), low financing capabilities or more pressing priorities. In such cases there is a serious risk that new variants of Covid‑19 will emerge that may prove resistant to the current vaccines in circulation.

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