First Batch of Vaccines and Time to Look Ahead with Hope - FBNQuest

As a batch of almost four million doses of the AstraZeneca (AZ)/Oxford University vaccine for COVID-19 arrived in Abuja on 02 March 2021, we can start to look tentatively ahead to the new normal. Drawing on the experience of countries where the rollout of vaccinations is more advanced, we can give some pointers as to the benefits and the pitfalls. The first on a personal level is that, while no injection for any condition is 100 per cent effective, the shot in the arm provides a psychological boost to the individual.

The National Primary Health Care Development Agency has set out the regulatory and monitoring measures to be taken as well as produced a draft on the priorities and timetable for vaccination. The age profile of Nigeria is very different from that of advanced economies, which has kept it much lower in the tables of fatalities adjusted for the size of the population. Its median age is 18 years, and more than 8 per cent of Nigerians are below the age of four. In the US the median age is 38 years, and the population below the age of 18 was lower in 2019 than it had been in 2010. In the UK 15 per cent of the population is aged over 70 years.

The priority list in Nigeria therefore looks very different. Another area to look out for is the definition of ‘key workers’ for priority vaccinations beyond frontline health employees. Should the police, refuse collectors and others in daily contact with the public be included? Another sensitive area, and one that the media is likely to pursue, is preferential treatment for the well-connected.

We should all be looking forward to life post-COVID-19 (or at least with contained COVID-19) even though this batch through the COVAX initiative is relatively small. It is essential to look through the tunnel for the light at the end of it, however distant, for morale-boosting and emotional health.

COVAX aims to distribute 237 million doses of the AZ vaccine by the end of May 2021, of which Nigeria is to receive 13.7 million doses. By end-year, its target is an ambitious two billion. Additionally, the African Union’s COVID-19 task force, chaired by Econet’s Steve Masiyiwa, is releasing its first batch of one million AZ doses. 

Elsewhere, there is a surplus in some countries. The UK government says that it has secured 440 million doses of different vaccines, which gives each inhabitant two courses each of two doses plus two boosters. Some of the excess could well be made available to other governments. Such an exercise of soft power would mirror the distribution of vaccines already launched by China, India and Russia.

Nigeria will likely lag most advanced economies in terms of whatever passes for full vaccination. (The concept is as mysterious as full employment, which does not mean that everyone of working age has a job). On arrival, the drivers underpinning its recovery will be different from theirs.

The fiscal resources available to the FGN are a fraction of those that G7 governments can tap; so no furlough schemes, no payments to the self-employed and much more limited programmes of public works to lift the economy out of recession. Also, the pent-up demand from people obliged to work from home and unable to splash the cash on holidays and restaurants will prove significant in the advanced economies, much less so in middle- and low-income countries. 

Written by Gregory Kronsten

Head, Macroeconomic and Fixed Income Research, FBNQuest