Vaccine to aid PH recovery

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The availability of a vaccine for the coronavirus disease 2019 (Covid-19) would greatly help in the country’s economic recovery as the Philippines continues to have difficulty in containing the virus, a London-based research consultancy firm said.

In a report, Capital Economics said the recent good news on vaccine development means that countries in Emerging Asia are likely to start inoculating their populations sooner than previously expected.

The vaccine of Pfizer and Biontech for the coronavirus disease 2019 has already been approved for use in the United Kingdom and Bahrain. AFP PHOTO

Capital Economics said that the Philippines, Indonesia and India have all struggled to contain the virus.

“Social distancing remains a major drag on activity, and our mobility trackers for these countries remain well-below pre-crisis levels,” Capital Economics said.

“A vaccine would be a game changer for these places. A lot will depend on how quickly these countries are able to inoculate their populations,” it added.

The Philippine economy contracted by 11.5 percent in the third quarter of the year, slower than the -16.9 percent recorded in the second quarter .

Capital Economics Asia Economist Alex Holmes, however, earlier pointed out that due to the lackluster rebound in the third quarter, improvements are likely to be harder to come by in the quarters ahead.

“Output is unlikely to regain its pre-crisis level until late next year,” said Holmes.

Holmes said the Philippine economy is projected to contract by 9.5 percent this year.

“While growth will look strong next year, this is due to a favourable base. More instructive is that output is unlikely to regain its pre-crisis level until late-2021 and we estimate that by the end of the next year the economy will still be over 10-percent smaller than if the (Covid-19) pandemic had not happened,” said Holmes.