Widespread vaccination is the key to overcoming the COVID-19 pandemic and bolstering economic recovery in Latin America, said Fitch Ratings in a special report.
"The virus resurgence will adversely affect economic activity in 1Q21, and the scope and pace of the recovery in 2H21 will depend on the speed and effectiveness of vaccine rollouts. Social distancing measures are likely to be eased but not fully removed until 2H21 or even 2022," it projected.
Fitch said that vaccination has begun slowly in much of the region, adding that limited vaccine supply and weak distribution networks pose challenges.
Chile, Brazil, and Costa Rica have administered the most doses per capita to date. Within this framework, Chile has made notable progress in recent weeks, the agency stressed.
The southern country now leads the region and plans to vaccinate the majority of its population by end-1H21.
Public confidence in the safety and efficacy of vaccines will also play a key role in increasing participation and achieving herd immunity.
New variants of the coronavirus have emerged in various parts of the world.
Also, a key risk for economic recovery is the prevalence of new variants that may be more contagious, have higher mortality, or be more resistant to the existing vaccines.
Slower-than-expected distribution or production bottlenecks (some evidence of this exists in the EU) would further slow the vaccine rollout and delay the recovery, it concluded.