Update Country Report Maldives 14 Jan 2021

• The Economist Intelligence Unit forecasts that only three economies in Asia will achieve widespread vaccination against the coronavirus (Covid-19) in 2021-namely Singapore, Hong Kong and Taiwan. However, this will not occur until the end of the year.
• Most economies will take until 2022 or later to reach this target. Many developing countries in Asia will not achieve widespread vaccination in the next five years, as their relatively small healthcare workforces will need longer to administer vaccines. They may also lack the resources to purchase enough doses.
• The drawn-out prospects for immunisation programmes will mean that outbreaks will continue in 2021, requiring Asian governments to keep economically disruptive border controls, social distancing and other measures in place. However, they will probably be managed and implemented with increasing effectiveness.
• We do not expect vaccines to achieve strong positive economic effects until at least 2022; these will include boosting confidence and allowing governments to move away from containment measures.

The Economist Intelligence Unit has developed a model to forecast-all other things held constant-the time it will take for countries to vaccinate 60% of their populations (the threshold we have set for "widespread vaccination", assuming that some groups, such as under-18s, pregnant women and those with certain chronic diseases, will not be able to receive a vaccine, and others will not be willing). The model factors in three main variables: the size of the population; the number of healthcare professionals; and the number of vaccine doses each healthcare professional can administer on a daily basis, using as a benchmark current and projected vaccination rates in countries that have already begun immunisation programmes, such as Israel, the UK and the US.

Vaccine procurement plans take shape

Most countries are planning to purchase from multiple vaccine producers-a strategy intended to guarantee sufficient supply even if one candidate fails to pass clinical trials or regulatory approval. The Pfizer-BioNTech and Moderna vaccines are common choices in the region, especially in developed countries such as Japan, Singapore and South Korea, which can afford the relatively high price and have the infrastructure to meet the cold-chain storage requirements. The Oxford University-AstraZeneca vaccine is also popular; it is more accessible for developing countries because it is cheaper and has easier storage requirements.

Many countries in Asia have signed up for the Covid-19 Vaccine Access (COVAX) Facility-a global initiative to subsidise vaccines for lower-income countries, led by the World Health Organisation. China and India stand out in the region because they have large-scale domestic vaccine production capacity, which will give them advantages in terms of production and prioritising their local populations; they also plan to export such vaccines.

A stretched timeline

China and Singapore were the first in the region to start vaccinating high-risk groups in December 2020, and trials in countries including India and Indonesia began earlier. We expect other developed countries in Asia, as well as India, to start their initiatives in the first quarter of 2021. The exception will be New Zealand, where we expect delays in regulatory approval to push back the public vaccination programme until the second quarter. COVAX has pledged to begin shipments to developing countries in the first quarter, although supply constraints will probably delay this to the second quarter or later.

The priority for most countries in the first stage of their vaccination programmes will be high-risk groups, such as the elderly and frontline healthcare workers. However, others-including China and Indonesia-are set to focus on the working-age population, viewing them as the most likely transmitters of the coronavirus. There will be an interim period of several months while governments secure increased vaccine supplies before large-scale immunisation of the general public can begin.

According to our forecasts, the first economies in Asia to achieve widespread vaccination will be Singapore, Hong Kong and Taiwan. We expect them to cross this threshold in the fourth quarter of 2021, helped by the large number of healthcare workers relative to the size of their overall populations and relatively robust healthcare systems. The ability of these three economies to move ahead of the region will boost confidence and allow their governments to move away from economically costly lockdown policies. This will be especially important for Singapore and Hong Kong, as open business-hub economies.

The next group will be Macau, New Zealand and Australia, in the first quarter of 2022. Ample healthcare resources mean that New Zealand and Australia can vaccinate their populations rapidly, but the expected regulatory delays will push back the start of their programmes. Despite Macau's small population, the territory's relatively limited healthcare resources will complicate vaccine distribution. We expect Japan, South Korea and Vietnam to achieve widespread vaccination in the second quarter of 2022. Japan would be earlier, were it not for the issue of vaccine hesitancy; the country has the lowest level of trust in vaccines in Asia, according to a study published in 2020 by a UK medical journal, The Lancet. China, Thailand and Brunei will cross the threshold in the third quarter of 2022, followed by Mongolia and India in the fourth. It will take other economies until 2023 or later.

Many developing countries in Asia will not be able to achieve the target of 60% immunisation within the next five years. This is principally because of a low number of healthcare workers vis-à-vis their overall population size, or challenges in vaccine procurement. If international organisations or other governments deploy additional resources to these countries to help to administer vaccines, it could enable a faster rate of vaccination. This will keep some developing countries more susceptible to future outbreaks, preserving caution among other governments about opening their borders to travel with those countries and exacerbating regional economic inequalities.

Upside and downside risks

There are upside risks to our forecast. Countries could mobilise additional personnel (such as medical school students or military healthcare workers) to administer vaccines, thus accelerating vaccination timelines. Downside risks are also prevalent. We do not currently know how often people will need to take a vaccine to remain protected. If, for example, people need a booster shot on an annual basis, it could lengthen the timeline. Should the currently available vaccines fail to protect against variant strains of the coronavirus, there would be delays while pharmaceutical companies develop new candidates.

On the supply side, production could fail to keep up with demand, especially as developed countries have secured an outsized proportion of vaccines; logistics might also take longer than expected. On the demand side, countries with strained fiscal resources may struggle to purchase enough vaccines, although COVAX will help to cover the cost of vaccines for at least 20% of developing countries' populations. Vaccine hesitancy will also be an issue.

It will not be until 2022 that transformative immunisation levels will begin to be achieved, allowing most countries to remove mobility restrictions (or to avoid imposing them) and thus boost consumer and investor confidence. As a result, we forecast that controls on international travel (including tests and quarantines) will remain in place even once widespread vaccination is achieved, given that no vaccine is completely effective and that immunisation rates will vary between countries. We therefore maintain that regional tourism activity will not return to pre-pandemic levels until at least 2023.