The government targeting to inoculate 70% of the population against the coronavirus disease 2019 (COVID-19) by end-2021. -- Photo by Michael Varcas

The Philippines’ economic recovery will likely continue to lag behind its peers in the region due to the slow pace of its vaccination rollout, with herd immunity now expected to be attained by May 2022, analysts from Maybank Kim Eng said.  

In a note on Friday, Maybank analysts Chua Hak Bin, Lee Ju Ye, and Linda Liu said the Philippines and Thailand will likely achieve herd immunity by May 2022, even as governments of both countries are targeting to inoculate 70% of their population against the coronavirus disease 2019 (COVID-19) by end-2021. 

They noted Singapore has already achieved herd immunity this month based on the current pace of vaccination, with Malaysia expected to follow by October. 

Indonesia and Vietnam are expected to attain herd immunity by July 2022 and August 2022, respectively. 

“The popular narrative is that the quickening vaccine rollout will soon unlock growth for the laggards. Reopening the economy more permanently can materialize when the vaccination rate reaches herd immunity thresholds at about 70%, Maybank analysts said. 

As of Thursday, the Philippines has fully vaccinated 11.8% of its population based on the global tracker Our World in Data, following Singapore (71.3%) and Malaysia (36.3%). This was also better than Indonesia’s 10.8%, Thailand’s 7.9% and Vietnam’s 1.5% inoculation rate.   

“Growth may jump, particularly for domestic services, when the vaccination rate reaches herd immunity thresholds,” Maybank analysts said.  

However, they warned that delays in the arrival of vaccines and the emergence of more contagious variants could push back these timelines.  

“The recent renewed COVID spread linked to the Delta variant serves as a reminder that the emergence of any new infectious variants could mean that achieving herd immunity may be elusive,” they said.  

On Friday, the Health department reported 17,231 new COVID-19 infections, a record-high daily rise in cases. The number of active cases reached 123,251.  


Maybank analysts said a “divergent” recovery in the Southeast Asian region will likely persist through 2022, citing a survey conducted during its Invest ASEAN event. 

“Survey respondents believed that the divergent and uneven economic recovery could last well into 2022. Investors are not convinced that the laggards will catch-up with the leaders and expect Singapore and Vietnam to continue outperforming in 2022. This is despite the laggards catching up on vaccination and with that the prospects of economic reopening,” Maybank analysts said, adding that the Philippines and Thailand were seen as the laggards in the region.  

Asked which economy would lead the ASEAN’s post-pandemic recovery, 63% of the respondents answered Singapore while only 1% of the respondents said the Philippines.   

The divergent recovery path of ASEAN economies are driven by “uneven vaccination rollout; stronger global recovery in manufacturing and exports relative to services dampened by lockdowns; and uneven fiscal support between rich and poor,” Maybank analysts said.   

Maybank forecasts the Philippine economy to grow by 5.5% this year, slightly faster than the downgraded government target of 4-5%.   

It also noted the Philippines is facing limited fiscal space with its debt stock ratio hitting 60% of the country’s gross domestic product (GDP) from just below 39% in 2019.  

“The uneven fiscal support and diminishing fiscal space for poorer ASEAN countries may accentuate the divergent recoveries. Singapore and, to a lesser extent, Thailand have launched more generous direct fiscal support programs given their stronger fiscal positions going into the pandemic. But the Philippines, Indonesia and Malaysia are facing large increases in public debt and waning fiscal space,” it said. — BML