Vaccination to revive Philippine economy

As we had written a few months back, the Philippine economy (GDP) shrunk by 10% in 2020 which is some P2 trillion less than the 2019 value of all goods and services produced in that year, or in demand terms, P2 trillion less purchases by the consumers and the government. This is the biggest shrinkage of the economy since World War II, both in amount and percentage, and the dire impact on the lives of many Filipinos are very visible. The country cannot afford further recession. The good news is that the decline has slowed down in the fourth quarter of 2020, and if the infections and the lockdowns will ease, and the vaccinations will start by the second quarter of 2021, the GDP will grow by 6.5% in 2021. This is a tall order that needs the government to get their act together and stop dropping the ball.

We seem to have a very distracted executive and legislative departments in the government that aren’t getting priorities right. Surely, enflaming the students in the universities, erroneous red tagging, untimely charter change, and cumbersome private motor vehicle inspection are less important than the raging pandemic, closing businesses, and increasing unemployment. The national government’s lack of a credible vaccination plan, and public mistrust of their pronouncements are obvious inadequacies. The local government’s vaccination program and preparedness looks better and may save the national government.

As of January 31, 2021, only Israel and UAE have vaccinated 25% of their population. The US and Europe have reached 10%, and the rest of the world from 0% to 5%, the Philippines .1 of 1% from smuggled vaccines. From President Biden’s assumption of office, the US has ramped up to 1 million vaccinations per day and will get to 1.5 million per day by mid-February. By end of January, 25 million Americans have been vaccinated. In 160 days, 250 million Americans or 70% will have been vaccinated. The same will happen in the European countries, Japan, Singapore, China, Russia, and some Middle East countries, but may extend up to September. In the Philippines, we have to vaccinate 70 million out of our 100 million residents. At the rate of 100,000 vaccinations per day, it will take 700 days or two years to reach this target, not acceptable if we want to revive the economy in 2021. At the very least, we should vaccinate at the rate of 200,000 a day to reach the 70% threshold for herd immunity in one year, which will be in April 2022. If we do 300,000 per day, we will have vaccinated 70 million by November this year.

The availability of vaccine supply currently experienced is a production problem that will likely ease up in April, as more vaccines get FDA/WHO approval and production lines are added and rationalized. Pfizer and Astrazeneca have production targets of 2 billion this year. Moderna, Johnson & Johnson, Sinovac, Sinopharm, Novovax, and other vaccine manufacturers will add another 7 million. All these manufacturers are already producing and stockpiling their vaccines that there will be enough vaccines available this year. The bottleneck will be in the procurement, distribution, and the physical injection to people which is where the governments are failing.

The solution is to allow multi-channel procurement, distribution and application. Allowing the local governments and private companies to secure vaccine supply contracts is in this direction, but there is really no need to have government approval to import as long as the vaccines are already approved by WHO and the FDAs of the country of origin and our Philippine FDA. Let the private sector procure the vaccines and sell or give it for free to their employees, and let all accredited clinics or hospitals make the injections. This is the way to have 70 million Filipinos vaccinated by November of this year, and revive/grow the economy in 2021.