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Virus-Fueled Recession Interrupts ASEAN Path to Middle-Income Status

VOA News

   Indicators as diverse as movie ticket sales and airport arrivals
   reinforce the view that a recession is under way in some Southeast
   Asian economies and imminent in others, due in large part to COVID-19.

   All but two of the 10 nations in the region will see negative growth in
   gross domestic product this year, according to data compiled by Capital
   Economics, a research company. Vietnam and Myanmar are the exceptions,
   while Singapore's GDP already contracted in the first quarter, and
   Thailand, Malaysia and the Philippines will see the biggest economic
   losses of 2020. The data mark a sharp change of fortune for the once
   fast-growing economies, which are key to global supply chains.

   Overall GDP will decrease about 10% in Southeast Asia this year,
   compared with the increase of close to 5% last year, Capital Economics
   forecast.

   "COVID-19 has hit us in a very hard way," Philippine Finance Secretary
   Carlos Dominguez said earlier this month. He explained the need for the
   government to provide economic aid to citizens, saying, "So the program
   is to spend, first, to help the poorest families, and then to help the
   small and medium enterprises, and then to provide support for the
   companies that are supported by their banks."

   The decrease in travel, exports like component parts, and remittances
   from the Philippine diaspora is hurting the economy. The nation also
   has the strictest lockdown rules in the region, including arrests of
   violators, which will affect the Philippine's ability to rebound,
   economists say.

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