THE Southeast Asian region failed to meet economic growth forecast in the past year as the Philippines and Malaysia booked deep contractions, according to a study by the United Nations Conference on Trade and Development (Unctad).
A recent report by Unctad showed the bloc saw its economy suffer a 3.9-percent decline last year, a reversal of 4.4-percent growth in 2019, as the coronavirus pandemic slowed down business activities.
“The growth rate of the Southeast Asian region as a whole was similarly below our mid-2020 expectations, as other large economies in the region [namely Malaysia and the Philippines] also underperformed vis-à-vis our expectations,” the report noted.
Last year, the economies of the Philippines and Malaysia shrank by 9.5 percent and 5.6 percent, respectively.
Unctad said both countries had a hard time containing the spread of the coronavirus as evidenced by elevated cases, hampering business activities because of lockdown protocols. “The economic fallout of these restrictions has been predictably severe, with substantial output contractions in both countries,” the report noted.
The Philippines closed 2020 with over 474,000 confirmed Covid-19 cases, 25,024 of which are active. Death toll and recoveries reached 9,244 and 439,796, respectively, last year.
After registering some decline in new cases, the country saw a fresh surge of infection since the beginning of 2021. Total Covid-19 cases have reached over 635,000 already; and around 61,700 of these are active. The death toll has increased to approximately 12,800 while recoveries reached more than 561,000.
On March 15, the government enforced curfew between 10 pm and 5 am in the capital region as a response to the rising Covid-19 cases. This will be lifted on March 30.
In 2020, Vietnam was the only country in the region that was a “significant positive surprise,” the Unctad report noted, as it exceeded the growth forecast.
“The country’s success in containing the virus’ spread helped to ensure a quick bounce back in activity, while the export sector continued to perform well despite the shortfall in global demand,” it added.
This year, Unctad pegged the growth forecast of the Southeast Asian economy at 5.1 percent.
“This is largely due to the greater than anticipated contraction in 2020, which should engender a steeper recovery in 2021,” the report said.
Unctad said private consumption and exports in the region are expected to rebound this year, which can help the economy to recover as well.
A recent report by Moody’s Analytics noted that the Philippine economy is likely to be the last among 14 countries in Asia Pacific to return to pre-pandemic level.
The think tank said the Philippine economy is seen fully recover from the pandemic by the third quarter of 2022. Thailand and Malaysia will also return to pre-pandemic levels next year but earlier or during the first quarter and second quarter, respectively.
China, Vietnam, Taiwan, New Zealand and India have already surpassed their 2019 fourth quarter performance last year, Moody’s said. This year, Korea, Australia, Indonesia, Hong Kong and Japan, meanwhile, are expected to get back to their end-2019 levels.
Image credits: Nonoy Lacza
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