• Our new global baseline scenario sees a slow population-wide roll-out of an effective vaccine underpinning a gradual global economic recovery. Starting in summer 2021, this roll-out will last into Q2 2022.
• In this scenario all mobility restrictions are lifted from Q2 2022. Only then can the global economy break into a growth spurt to make up the lost output versus trend growth.
• As things stand, however, the combination of a second wave with partial lockdowns and second-round effects from the first wave has plunged the eurozone into a deeper double dip.
• But the slump will be less severe than during the first wave, partly because China is sustaining a robust recovery and pulling global industrial trade in its slipstream.
• The US is going through a third wave of infections. Despite the staggeringly high infection rate, partial lockdowns have only been introduced in roughly one third of the states. The decline in production will therefore remain limited (6 to 7%) compared to the first wave (some 30%).
• Forecasting is fraught with uncertainties in times of crisis, hence the need for two alternative scenarios. In our negative scenario the roll-out of an effective vaccine is delayed, so that the restrictions can only be lifted six months later, with the world not fully reopening for business until 2023.
• In our positive scenario, a rapid roll-out of an effective vaccine combined with mass rapid testing paves the way for a full reopening of the global economy as early as Q4 2021.

The three scenarios see the major economies and the Netherlands developing this and next year as follows:

Baseline scenario: the vaccine and restriction timelines

With the onset of the second wave triggering a new partial lockdown, we seemed to be heading for a long dark winter, but the news of a vaccine breakthrough has brought some very welcome light at the end of the tunnel.

Even so, the full herd immunity that is necessary to restore our lives to pre-Covid normality will not be achieved until around summer 2022.

That is an alarmingly long road ahead, but the first steps towards vaccinating the entire population will already get under way in summer 2021, starting with the elderly, followed by the younger age groups. During this process, the restrictions can be lifted at an accelerated rate without fresh outbreaks of the virus.

As fears of a virus comeback and renewed restrictions ebb away, the economy will be able to stage a vigorous recovery from Q3 2021.

But first let’s briefly return to the here and now: when the vaccine developed by Pfizer and BioNtech is granted Emergency Market Access in a few weeks’ time (December 2020), we will enter a difficult phase. Because testing times still lie ahead.

The vaccine is tantalisingly close, but still out of reach. The tail-end of 2020 and the first quarter of 2021 will be devoted to setting up the infrastructure that is necessary to make the vaccine accessible to highly vulnerable groups and key occupations such as health and emergency workers.

In Q2, when more is known about the effectiveness of the vaccine outside the laboratory, the manufacturers can apply for a licence for full market access. As this type of vaccine has never previously been trialled on humans, this extra time is deemed necessary to make sure it is entirely safe.

The restrictions timeline will then look as follows: