Update Country Report Maldives 12 Aug 2021

• The Economist Intelligence Unit has brought forward its timelines for vaccination rollout in Asia. Governments have been able to vaccinate at faster rates than we expected and have secured additional doses, thus easing supply issues.
• The majority of economies in Asia are using vaccines with relatively low efficacy against Covid-19, which means that greater coverage is needed to achieve herd immunity. Booster shots will also be required, especially given the spread of the more contagious Delta variant in the region.
• Our outlook, as well as lower tolerance of Covid-19 in Asia, suggests that restrictions such as social distancing, lockdowns and border controls will remain in use in most of the region throughout 2021-22.

This is an update to The Economist Intelligence Unit's outlook for the rollout of Covid-19 vaccination in Asia, which was last published in May. Our timeline projects how long it will take for countries to vaccinate 60% of their population; this is the minimum threshold we expect to be necessary to achieve herd immunity against the virus (although the exact threshold remains uncertain, and may now be higher because of the emergence of more contagious strains of the coronavirus). Our model factors in 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 current and projected vaccination rates as a benchmark.

Key changes to our vaccination timeline for Asia

Governments in Asia have generally been able to vaccinate their populations at a faster pace than we had initially expected. This means that the outlook for vaccination has improved for many countries in the region this quarter, with two, Bhutan and the Maldives, having already achieved widespread vaccination by July 2021. Immunisation against Covid-19 is an unprecedented task, with the pressure to deliver doses greater than in most historical vaccination drives. Health authorities have been able to vaccinate more quickly than ever before, with mass vaccination sites, the recruitment of additional workers and the provision of military support.

Overall, however, Asia will lag behind developed Western economies when it comes to achieving widespread vaccination. Most countries in Europe and North America will vaccinate 60% of their populations by the third quarter of 2021. In Asia, the majority of territories will not achieve this until 2022 or later (with the exception of Bhutan, China, Hong Kong, the Maldives, Mongolia and Singapore). This will weigh on the pace of economic recovery in the region. Major tourism destinations will struggle to attract US and European tourists before they vaccinate their local populations.

We have made the largest upgrade to our vaccination outlook for China. We now expect the country to achieve widespread vaccination in the third quarter of 2021, compared to the second quarter of 2022 previously. The Chinese health authorities were able to deliver more vaccines than were being produced because manufacturers had begun to make doses last year, even before they had received regulatory approval. This meant that companies such as Sinopharm and Sinovac had stockpiles to draw on.

Daily vaccination rates reached highs of over 20m in the second quarter, despite daily production capacity being only around 9m. China had administered 1.7bn doses by August 4th, and we estimate that 40-50% of the population had received two doses by that date. Another reason for the upgrade to our forecast is that we expect schools to organise the vaccination of students when they start a new term in September 2021.

India's vaccination outlook has also brightened, with widespread inoculation now anticipated in the second quarter of 2022, compared to the fourth quarter of that year previously. The rate of immunisation picked up over the second quarter and has averaged around 4.5m doses per day since mid-June. Production capacity is sufficient to sustain this rate and is expected to rise further, which will help to offset the effects of de facto vaccine export restrictions being lifted at the end of 2021.

Many migrant workers will be vaccinated in the cities where they work, reducing the acute pressure for immunisation in India's countryside. Nonetheless, private healthcare providers will be reluctant to extend their campaigns to these areas, and the onus of inoculating the remainder of the rural population will fall squarely on the government-funded vaccination drive. This could cause some slowdown in the pace of vaccination as the focus shifts from the urban to the rural population.

Many countries in Asia have secured additional shipments and donations of vaccines (notably from China and the US), which have helped to ease supply-side pressures. We have brought forward the timelines for Cambodia, Fiji, Mongolia, Pakistan and Singapore for this reason.

Meanwhile, in places where vaccine hesitancy was expected to be an impediment, like Japan, people have proved more willing to be vaccinated against Covid-19 than against other diseases in the past. In Japan, the hosting of the Olympics is also likely to have spurred on the pace of immunisation. There are signs of some governments taking extreme measures to tackle vaccine hesitancy: the government of Fiji has made vaccination mandatory for work, for example, and in China some local governments are allowing shops and public places to require proof of vaccination for entry.

We have made one downgrade to our forecast, for Macau; we do not expect that territory to vaccinate 60% of its population until the first quarter of 2022, compared to our previous forecast of the fourth quarter of 2021. Vaccine uptake was slow in the second quarter of 2021, because of safety concerns. Macau did not suffer an outbreak of Covid-19 for over a year, from March 2020 to August 2021, which may have reduced the sense of urgency among residents to be vaccinated.

Main vaccines used in Asia have lower efficacy

Many economies in Asia will lag behind Europe and North America in terms of achieving herd immunity. This means that their populations will remain vulnerable to Covid-19 in 2021-22 (and even in 2023 and beyond for some developing economies). Governments in the region will therefore not move away from Covid-19 restrictions (such as social distancing, lockdowns and border controls) as early as their counterparts in Europe and North America. This will hamper the recovery in economic activity, especially private consumption. However, most governments in Asia (with some exceptions, such as China and Taiwan), have reduced the stringency of restrictions and are increasingly tolerant of some level of Covid-19, especially as new strains-such as the Delta variant-are harder to curb with such measures and are also less deadly.

Aside from taking longer to obtain and administer vaccines, many territories in Asia also have less access to the most effective candidates. The Pfizer-BioNTech (US/Germany) and Moderna (US) vaccines have the highest efficacy against the original strain of Covid-19, at over 90%, according to the World Health Organisation (WHO). However, in Asia only some more developed economies, like Australia, Hong Kong, Japan, New Zealand and Singapore, have access to Pfizer-BioNTech as their main vaccine (along with New Caledonia, which has benefitted from support from France). The region has only obtained small quantities of the Moderna vaccine, and that candidate will therefore have little effect on overall protection against Covid-19. Pfizer-BioNTech and Moderna have prioritised supply for their home markets and, as a result of cost factors, many governments in Asia have not been able to afford large quantities.

Almost half of the territories in Asia are using the Oxford University-AstraZeneca (UK) vaccine as the main candidate in their vaccine programme. The WHO has estimated the efficacy of this vaccine at 63.1%, and the level is probably even lower against the Delta variant. This reliance is the result of many governments (aside from India, which is able to meet its needs with domestic production) having to rely on donations from the WHO's COVAX Facility, which has mainly provided the AstraZeneca vaccine. These are mostly developing economies in the Pacific Islands and South and South-East Asia (with the exceptions of South Korea and Taiwan). Another six countries (Cambodia, China, Indonesia, Myanmar, the Philippines and Thailand) are using the vaccine produced by China's Sinovac for a large proportion of doses, as there has been a greater available supply of Chinese vaccines, and China has also donated doses. The Sinovac vaccine has efficacy of just 51% against the original strain of Covid-19.

The territories that are reliant on vaccines with relatively low efficacy against Covid-19 will probably have greater need to administer booster shots. This will delay the time it takes them to achieve herd immunity against the virus and will leave them vulnerable to breakthrough infections, even among people who have been vaccinated. The Cambodian, Indonesian and Thai governments are planning to provide booster shots of the AstraZeneca vaccine to those who received Sinovac doses, and Cambodia will also offer booster shots of Chinese vaccines to those who received the AstraZeneca vaccine.