Japan’s vaccination drive is picking up steam. That’s good news for the retail sector, says EY

Japan’s vaccination efforts are gaining some momentum now after a slow start, and that’s good news for retailers, said EY’s Nobuko Kobayashi.

“The vaccination, finally, is picking up steam in Japan. Government says that all who wants to be vaccinated can be by October, November,” Kobayashi, Asia-Pacific strategy execution leader at EY, told CNBC’s “Street Signs Asia” on Friday.

Looking ahead, the short-term milestone will be if Japan’s vaccination rollout reaches a level whereby “everyone feels comfortable to go out again,” she said. Kobayashi said the consumption outlook on balance is positive, even taking into consideration concerns about Covid variants like delta.

Following a sluggish rollout earlier in the year, vaccination rates in Japan have risen substantially in recent weeks. Daily Covid-19 vaccine doses administered even crossed the one million mark in June, according to Our World in Data.

Japan’s doses per 100 people reached an average of 0.77 for the seven days ending July 1, according to Our World in Data. That’s higher than the 0.48 and 0.32 doses per 100 in the United Kingdom and the U.S., respectively, over the same period.

Still, only 12.65% of Japan’s population has been fully vaccinated against Covid, as compared with the U.K. and U.S. which have both inoculated more than 40% of their population. In 2020, Japan had a population of more than 125.83 million, according to World Bank data.

Japan is just weeks away from hosting the Summer Olympics, but Tokyo prefecture remains under priority measures intended to limit the spread of the virus. Some aspects of the games remain undecided. Japanese Prime Minister Yoshihide Suga said Thursday that they could be held without spectators, according to local news agency Kyodo News.

Still, EY’s Kobayashi said the Olympics are likely to have a “positive impact” on Japan’s retail landscape even if spectators are barred from the games.

In the short term, she said products such as high-definition TVs could see a spike in demand. Meanwhile, a successfully executed Olympics will “increase the attractiveness of Japan” as an international travel destination in the long-run, she said.

“It’s great news for inbound tourism and consumption,” said Kobayashi.

Disclosure: CNBC parent NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics is the U.S. broadcast rights holder to all Summer and Winter Games through 2032.