Canada needs a literal shot to the arm far more than a fiscal one, according to some of the nation’s top economists.

With growth proving surprisingly resilient through the fourth quarter and into the early days of 2021, some of the top economic minds in the country say an effective vaccine rollout would trump further monetary or fiscal stimulus measures in terms of getting Canada back on track.

In an email to BNN Bloomberg, Frances Donald, chief economist and head of macro strategy at Manulife Investment Management, said widespread vaccination and its subsequent impact on the reopening of the Canadian economy would be a more powerful lever for growth than further measures from the federal government or the Bank of Canada.

“We don’t need either monetary policy or fiscal policy, we need faster vaccine rollouts,” she said.

Canada has administered first doses of COVID-19 vaccines to 3.83 per cent of the population, as of March 2. Though vaccines from three companies – Pfizer Inc., Moderna Inc., and AstraZeneca plc - have been approved for use in the country, Canada lags other developed nations, outpacing only Japan among G7 members.

In spite of the pandemic, Statistics Canada estimated the domestic economy grew 0.5 per cent in January, coming off a strong 9.6 per cent annualized surge over the course of the fourth quarter of 2020. Overall output has recovered to 97 per cent of its February 2020 levels, before the pandemic put a deep freeze on the Canadian economy.

That somewhat optimistic growth forecast came as stricter lockdown measures were implemented in Ontario, the heart of the Canadian economy, and potentially signal a degree of resiliency in the domestic economy even before measures to combat the spread of the virus are eased.

In an email to BNN Bloomberg, Bank of Montreal Chief Economist and Managing Director Doug Porter said a combination of hoarded savings and pent-up demand from consumers stuck at home for more than a year has the potential to turbocharge the domestic economic recovery over the course of 2021.

“I believe that the combination of almost $200 billion of excess savings, pent-up demand for some services, rebounding commodity industries, and a likely powerful U.S. recovery all point to very strong growth in Canada in the year ahead,” Porter said. “And the best way to unleash that growth would be to put the pandemic in the rear-window, hopefully through vaccination.”

Porter and his BMO colleagues boosted their view for domestic economic growth on Tuesday, raising their forecast a full percentage point to six per cent growth in 2021, which would represent the strongest year of gains since 1974.

In light of the pandemic, Canada has undertaken a spending spree unprecedented in peace time, with the federal deficit on track to exceed $381 billion this fiscal year according to the government’s fall fiscal update.

The feds have also earmarked between $70 billion and $100 billion over the next three years to jumpstart the economy as it emerges from the worst of the pandemic-induced pain, a move Finance Canada has no intention of backing down from. In an email to BNN Bloomberg, Finance Canada spokesperson Katherine Cuplinskas said that given the uncertainty around the economic outlook, Ottawa would not change its plans to inject cash into the domestic economy.

“History and experience of previous recessions have taught us that the risk of government doing too little outweighs the risk of doing too much,” she said. “Our priority therefore remains the same: Fighting the pandemic, and creating the best economic conditions for jobs and growth.”

While those stimulus measures remain in place, not everyone in the economic community is convinced the full $100-billion barrage will prove necessary. In an email to BNN Bloomberg, CIBC Senior Economist Royce Mendes said Canada may not need that degree of stimulus. But, he added that it would be best to be prepared for any eventuality rather than scaling back potential supports prematurely.

“It’s prudent to keep measures in place at least until we’re actually conquering the virus, which still seems like it could be a few months away,” he said. “The economy may very well ultimately not need all of the $70 to $100 billion of stimulus to jumpstart the recovery. So it’s probably wise to set benchmarks for economic milestones that would automatically scale back that spending should the economy reach them.”

When it comes to any additional spending, policymakers will likely have to act with surgical precision to ensure cash flows to the areas of greatest needs, according to Scotiabank Deputy Chief Economist Brett House.

In an email to BNN Bloomberg, House said any further support should be aimed at sectors that are still bearing the brunt of restrictions.

“We need to make a clear distinction between emergency fiscal support to get households and businesses through the pandemic, and additional spending to prime growth further. Emergency support, in increasingly targeted forms, will be necessary as long as activities and sectors where physical distancing is difficult are impaired by contagion restrictions,” he said. “New novel coronavirus variants and uncertainty about how long immunity lasts after COVID-19 could extend these restrictions—and the need for continued emergency support for hard-hit businesses and workers.”