Australia's COVID vulnerability - BetaShares

Australia’s COVID vulnerability

BY David Bassanese | 28 June 2021
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  • Despite Australia’s relatively good performance in containing COVID to date, our high urbanisation rate and low vaccination rate has now left us increasingly vulnerable to COVID compared to our international peers – especially with the emergence of new more highly contagious variants.

Australia is very urbanised

  • Even by developed world standards, Australia is relatively urbanised.  According to the OECD, for example, 67% of our population live in large cities (populations of greater than 500,000), compared with an OECD average of only 55%.

  • In NSW, for example, 62% of the population live in Greater (Metropolitan) Sydney, which comprises just 1.4% of the State’s geographic area1.

Low vaccination rate to date

  • At the same time, the evidence to date suggests no more than 5% (one in 20) Australians are as yet fully vaccinated, compared to 45%(almost one in two) in the United States. Across the whole world (which includes developing countries), around 10% of people have already been fully vaccinated – twice the rate in Australia.

NSW, and especially Sydney, important for economic growth

  • The recently announced lock down of metropolitan Sydney poses a major near-term risk to national economic growth if extended, with the implications far worse if COVID soon spreads to other States.  According to regional economic data 2, for example, NSW accounts for around one third of Australian GDP, with the Sydney metropolitan areas accounting for 25% (or 75% of NSW’s total).
  • Although Australia has largely closed its borders to international tourism, the repatriation of Australians abroad and the necessary continuation of international trade flows means it’s impossible to completely seal us off from the outside world. It is imperative in this regard that quarantine systems and procedures in dealing with (for example) international flight crew are rigorous as possible.

 

  1. NSW Parliamentary Research Service: Regional NSW- A demographic and economic snapshot. January 2020.
  2. SGS Economic Research.

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