Japan's slow Covid-19 vaccine roll-out pushes back recovery time frame

Japan's Prime Minister Yoshihide Suga inspects the vaccination program at the state-run Tokyo Medical Center on Feb 18, 2021. PHOTO: AFP

TOKYO (BLOOMBERG) - Japan's vaccination drive finally kicks into gear Monday (April 12) around four months after the start of inoculations in the US and the UK, a slow rollout that has generated further criticism of Prime Minister Yoshihide Suga's handling of the pandemic.

The doses for people 65 and over are the first vaccinations for members of the public in Japan after priority was given to inoculating frontline medical staff first.

Japan has so far weathered the coronavirus pandemic relatively well, with infection numbers and deaths just a fraction of many Western countries.

But the slow vaccination plan means struggling businesses and fearful shoppers will have to hold out for longer as the recovery of the economy is delayed by as much as two years compared with global peers.

The tardy start comes as stricter measures were reinstated Monday to quell an uptick in virus cases in the capital, fuelling discontent with Mr Suga in an election year, as the government, like many around the world, lurches between tightening and loosening guidelines on activity.

It also adds to smoldering doubts over Tokyo's readiness to host the Olympics in July with no timeline for when most people will be inoculated.

"More than anything we need to get on with these vaccinations quickly," said Mr Kazutaka Sato, the 70-year-old owner of a restaurant in Osaka, the current centre of the pandemic in Japan. "Without vaccinations, it's going to be extremely tough for businesses like ours to keep going."

Osaka recorded a record 918 new cases over the weekend and Tokyo's seven-day average has also crept in recent weeks.

With no domestically developed Covid vaccine of its own, Japan's late rollout stems from a dependence on imported shots that were initially in limited supply. Another factor was a strict approval process that required local clinical trials for foreign vaccines. So far, Japan has only given the green light to Pfizer-BioNTech's jabs.

Especially given Japan's history of public skepticism over vaccine safety, a take-it-slow approach may have also been needed to get the country on board. In Europe, reports that AstraZeneca Plc's vaccine may cause blood clots in rare instances have made some scared to get shots.

"Naturally, the general public would feel reluctant to take the vaccine after seeing this news," Mr Haruka Sakamoto, a public health researcher at the University of Tokyo, wrote in an email to Bloomberg.

Lost time

Still, Mr Suga's government is showing little appetite to make up for lost time. The first batches of vaccines for the over-65s will be limited to 1,000 doses for most areas of the country, with additional doses sent weekly.

Mr Taro Kono, Japan's vaccine point man and a possible successor to Mr Suga, told Bloomberg that the rate of Covid-19 inoculations is unlikely to pick up speed until May. And the government has so far declined to set any schedule or long-term targets for getting shots into arms.

Meanwhile, a third of the US and half the UK population have already gotten at least one jab and those countries are expected to hit the 75 per cent mark within four months, according to Bloomberg projections.

"Safety and peace of mind for our citizens are very important and we had to do a local trial," Mr Suga said Monday in response to a question about Japan's slow roll-out. "We'd like to get vaccines out now to people as soon as possible."

Currently, Japan, a country of some 126 million people, likely has around 8 million doses of the Pfizer jab, according to figures provided by the government in March. The government estimates it could receive another 43 million doses in May, followed by 45 million in June. Its deal with Pfizer is for 144 million doses.

Japan also has deals for 120 million doses of AstraZeneca's jab and 50 million doses of Moderna Inc's. Both of those shots are being considered for emergency approval, but no decisions are expected until next month at the earliest.

Vaccine hesitancy

While vaccine hesitancy has been a key issue in Japan and other Asian countries where people are more wary of side effects, there are signs more residents are becoming willing. A survey in late March by the Jiji news agency showed 79 per cent of respondents wanted to take the Covid-19 jab. Another poll showed about two-thirds of people are getting impatient with the speed of the rollout.

Japan will prioritise its 36 million seniors over the age of 65 before opening up vaccinations to people with pre-existing health conditions and then younger age groups.

Progress is also likely to be patchy because of Japan's approach to delivering the vaccines to municipalities.

Even Mr Kono, the vaccine czar, acknowledges that residents of small villages may end up having an easier time getting their shots at first, just because a single shipment of doses might be enough to cover the population, while supply in big cities falls short of people's needs.

"It's staggering," said economist Takahide Kiuchi at Nomura Research Institute. "The gap with other nations is only widening. The vaccine drive has been so slow, putting the economy at risk."

The hit to consumer spending, which makes up more than half of gross domestic product, will hold back growth and make Japan an economic laggard this year, he says.

Not everyone agrees.

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Japan began Covid-19 vaccinations for its sizable elderly population on Monday, with imported doses still in short supply and the pace unlikely to stop a fourth wave of infection.

"The benefits of vaccination are bigger for countries that failed to control the virus infection as well as Japan," said Ms Yuki Masujima at Bloomberg Economics. "Thanks to the relatively low number of confirmed Covid-19 cases in Japan, the negative impact from the Japan's delay in vaccination should only shave at most 0.3 percentage point off GDP in 2021."

Still, that will leave Japan recovering at a slower pace than its peers and it will still take until 2023 before Japan's annual output regains its 2019 pre-pandemic level, compared with this year for the US and 2022 for the euro-zone, Ms Masujima said.

For Mr Sato, the restaurant owner, it's all about getting diners back into his shop, where customers are down by 70 per cent.

"Everyone will feel safer if they get vaccinated," he said. "Until then, we can't see a light at the end of the tunnel."

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