(Bloomberg) -- The U.K.'s approval of the coronavirus vaccine developed by Pfizer Inc. and BioNTech SE on Wednesday could be the start of the U.K. economy's rebound from its worst recession in three centuries, Chancellor of the Exchequer Rishi Sunak said.
“Confidence is critical, especially in an economy like ours, which, you know, more than most other economies is driven by consumption,” Sunak said on Wednesday in a Times Radio interview. Consumer confidence “has been in not as strong supply as we would like over the past several months, and hopefully, this is the start of a march back.”
The approval of the vaccine is the first by any Western country, and clears the way for a program of mass vaccination to begin next week. The U.K. has purchased 40 million doses of the Pfizer-BioNTech vaccine and has indicated it could secure 10 million of them by the end of the year.
After more than 8 months of restrictions to rein in the virus, Sunak now faces the task of repairing the U.K.'s finances. The country is forecast to borrow 394 billion pounds ($525 billion) this tax year, the highest in peace time. That amount has pushed the national debt over 2 trillion pounds for the first time, and to more than 100% of annual economic output for the first time since the 1960s.
On Wednesday, the chancellor said he needs to “keep an eye” on the debt pile, because if interest rates rise, it will be “problematic.”
Asked whether those with “broader shoulders” would take the burden of any tax rises, Sunak refused to be drawn on specific measures, saying only that he's “cognizant of those who are most vulnerable in our society” and that he'll also work to “support business and free enterprise.”
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